It’s fair to say that being treated as an automaton by your employer hardly breeds the most inspiring working environment. “I have worked for people where you’re just a cog,” says Steve Lowy, founder of umi Digital and CEO and founder of umi Hotels. He relays a story of a job he took at an upmarket Manchester restaurant prior to attending university. “After five days, I had some ideas and told them,” he says. “Basically, after the meeting, the manager called me into his office and said, ‘I’m sorry, we won’t be giving you the job: you’re overqualified’.”
While it’s unlikely many businesses will be setting employees adrift simply for engaging their brains, not every enterprise makes the most of the resources at their disposal. And this is a mistake Lowy refuses to make. “In a hotel, often the receptionist or the housekeeper will have more direct contact than I do with all of the guests and will come up with ideas that are more innovative,” he says.
Being open to employee contributions can actually lead to some of a company’s most revolutionary ideas. Lowy explains how one of their most successful campaigns emerged from a chance remark in a meeting, as he discussed with a colleague the best way to address the pinch the hospitality industry was feeling after the financial crash. “She said: ‘Why don’t we sell rooms for £1?’,” he recalls. Although intended as a sarcastic comment, the team quickly got excited by the idea and it ended up seeing umi Hotels featured on CNN International. “Some of these off- the-cuff ideas can actually be the most successful,” he remarks.
But democracy isn’t only about the free exchange of ideas. Social business, innovation and digital culture agency NixonMcInnes takes democracy very seriously, to the extent that it informs its entire structure. “Our two founders felt that it was the right way to do business, that it made sense at every level,” says Max St John, strategist for the agency and its head of not-for-profit and public sector. And they do mean at every level.
Some of their steps are truly radical, redressing some of the root assumptions about the way organisations should be structured. “We have completely open book accounting,” says St John. “All of the financials are shared each month by the finance director and everybody knows what everybody else earns; that’s on our company wiki.” Even their salary decisions are undertaken democratically, with salary changes at every level going in front of an elected rewards team. “They review every salary proposal across the whole business, including the managing director’s and any board members.”
Perhaps the most interesting area, however, is how they address company direction. “This year, the business plan has come off the back off of a strategy that the whole team has co-created,” St John comments. All NixonMcInnes employees attended a workshop where they looked at their priorities for the next three years, the things that mattered to them and how they would go about making this a reality.
Fairly standard fare for employee reviews, perhaps, but enshrining this in the overarching business plan ultimately means that employees know their priorities are the self-same ones guiding the business forward. “It creates a particular bond and relationship between the individual and the company,” explains St John. “People generally feel like they have a true stake in the business because they have a stake in most of the important decisions that are made.”
Again for umi’s Lowy, increasing a sense of ownership is vital – and that doesn’t stop just at employees. Umi Hotels operates various schemes for young people, from GCSE placements to year-long internships. One of the main focuses of these schemes is to put the young person in charge of a project, allowing them to work on something they care about and come up with new ideas. Not only can these ideas have a huge benefit for the organisation involved but they also create a workforce that, by dint of having true ownership over their efforts, are far more engaged. “By having that culture where everyone’s got a voice, it means that when an intern works for us they don’t feel like an intern,” says Lowy. “I think that’s really important.”
However, it’s not so much of a stretch to see why some organisations may balk at making such overarching changes to the way they are structured – especially when the political democracy has hardly set the best example. In a lot of people’s minds, democratic process is inextricably tied to increasing levels of bureaucracy but this is only a problem when people aren’t also given a degree of autonomy.
NixonMcInnes thinks democracy needn’t come at the price of streamlined decision-making. “Anyone can call a vote on an issue if it’s important enough but we also empower people to make as many decisions on their own,” St John explains. And, by virtue of the fact that employees are often behind decisions right from the get-go, there is little inertia as result of having to sell that decision to the people on the ground. He continues, “What we’ve found is that it doesn’t take much longer to make important decisions and when you do make those decisions, everybody has completely bought into them.”
In terms of social structures, democracy is one of the oldest. But, in fact, at a time when crowd-movements and financial crises are undermining tried and tested business models, it may be that our aged friend has plenty to teach us yet.