Democracy, Cooperation and Business Success: The Case of Mondragón Corporación Cooperativa

Abstract

Are democracy and success compatible in a business organization? In this work we show how Spain’s Mondragón Corporación Cooperativa (MCC) has made it possible. MCC can be considered a world leader in cooperativism. It is one of the few contemporary business organizations that can be viewed as a democracy, and it represents a unique experience in the use of democratic and participatory methods in management. MCC has developed its own Management Model based on its cooperative principles, on modern management practices and on the cutting edge experiences of the most advanced companies. In this work we analyze the key elements of MCC’s democratic management model, developed around aspects such as corporate culture, organizational structure or human resources. We also look at the case of Irizar, a component cooperative of MCC internationally known for its successful management model. Finally, we outline some practical implications of introducing democracy into organizations, drawn from the experiences of MCC and Irizar.

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Correspondence to Francisco Javier Forcadell.

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Dr Francisco Javier Forcadell (1974) is professor or strategic management at the Rey Juan Carlos University in Madrid, Spain. Their areas of investigation are related to corporate strategy, knowledge management and cooperativism.

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Forcadell, F.J. Democracy, Cooperation and Business Success: The Case of Mondragón Corporación Cooperativa. J Bus Ethics 56, 255–274 (2005). https://doi.org/10.1007/s10551-004-5094-5

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Keywords

  • co-operation
  • corporate culture
  • democracy
  • human resources
  • organizational structure
  • participation
  • strategy