Alan L. Gleitsman Professor of Social Innovation, HKS; Joseph C. Wilson Professor of Business Administration, HBS
The joint pursuit of commercial and societal objectives will likely require non-traditional (non-hierarchical) ways of organizing. This chapter discusses the prospects for one promising alternative:“organizational democracy.” This is a flatter form characterized by distributed decision rights, a deliberative culture, and employee ownership. Other alternatives to hierarchy have emphasized individualistic values of autonomy and empowerment. In contrast, organizational democracy emphasizes the collective. Relevant work in political philosophy underlines analogous dimensions including representation, deliberation, and a collective point of view. The last point makes it different from work on solidarity and class or group interest. In multi-objective organizational democracy there are trade-offs and these are negotiated. Representation and deliberation come to the foreground. Unlike in traditional organizations, however, negotiations are not regarded as transaction costs to be minimized; rather they are brought to the foreground and cultivated. The chapter illustrates these ideas and discusses challenges and avenues for future research.
Battilana, Julie, Michael Fuerstein, and Mike Lee. "New Prospects for Organizational Democracy? How the Joint Pursuit of Social and Financial Goals Challenges Traditional Organizational Designs." Capitalism Beyond Mutuality?: Perspectives Integrating Philosophy and Social Science. Ed. Subramanian Rangan. Oxford University Press, 2018.