The last decade has witnessed a marked increase in companies adopting new organizational practices aimed at promoting shopfloor participation (Osterman, 2000). These efforts to achieve greater employee involvement have been launched in two directions. Firstly, there has been an attempt to create a series of communication channels to permit the two-way flow of information between managers and employees. Meanwhile, there is a growing tendency to allow workers more participation and decisionmaking rights in their jobs, in a departure from the traditional organizational structure in which the worker’s tasks were strictly defined and employees were merely required to follow the supervisor’s instructions to the letter.
The growing diffusion of these practices, aimed at promoting shopfloor participation in firms, has been accompanied by keen academic interest in researching the various issues that this involves, particular attention being paid to whether or not these practices actually lead to an improvement in the firm’s performance and competitive edge (e.g. Batt and Appelbaum, 1995; Fernie and Metcalf, 1995; Black and Lynch, 1997; Ichniowski et al., 1997; Cappelli and Neumark, 1999; Ichniowski and Shaw, 1999).
Another example of employee participation, though of a very different nature, is to be found in producer cooperatives. Here, unlike the situation in typical capitalist firms, the workers are the owners and therefore hold all the control and return rights. The fact that these two rights are vested in the workers creates the need for an incentive framework completely different from that usually found in capitalist firms, and this will presumably have its effect on worker behavior and firm performance. The study of the effects of employees’ whole ownership rights on firm performance has given rise to a wide range of theoretical and empirical literature (Bonin et al., 1993; Porter and Scully, 1987).
The results of both shopfloor participation and worker co-operatives have received enormous attention in the literature. Less interest, however, has been directed towards the analysis of possible differences between cooperatives and capitalist firms, in terms of the effects of shopfloor participation programs on workers’ morale and organizational performance. Cooperative firms, in which workers own return rights and elect the board of directors, present an employment relationship scenario that clearly differs from that found in conventional firms. This could explain different levels of effectiveness in the adoption of practices aimed at promoting more direct participation of workers in their jobs.
This paper takes data from an initial sample of 965 Spanish manufacturing plants, to study the relationship between employee involvement, cooperatives and performance. The aim is to find the answers to three questions. An assessment will first of all be made of the results obtained when shopfloor participatory schemes are installed. Next, cooperatives will be analyzed to see if they achieve better performance measures than other types of companies. Finally, this investigation will attempt to ascertain whether the effectiveness of employee involvement practices varies according to whether they are introduced in a cooperative or a capitalist firm. Shopfloor participation in both these kinds of companies will be analyzed in order to detect any possible differences in outcome.
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