Theories of Self-Management

Abstract

The title of this chapter is intended to distinguish it from the organisational forms reviewed in Chapters 2 and 3 and to identify mechanisms that may have contributed to the actual performance of Yugoslavian (and other) enterprises which are apparently controlled by their workforces, and which are owned by them or the State. Given the anarchistic properties of what Williamson (1980, p.16) calls ‘every man for himself worker-controlled operations, effective decision-making probably requires an enterprise hierarchy, with the rotation or election of members to high-level positions. Such a voluntary hierarchy distinguishes self-management from the capitalist firm, where shareholders enjoy property rights to any residual income after the payment of labour and other costs out of revenues, and therefore have an incentive to monitor, or appoint managerial agents to monitor, the activities of employees to reduce shirking. Similarly, it is distinguished from the centrally planned enterprise, where the enterprise director monitors the workforce in order to achieve the performance required and rewarded by the central planners. In all hierarchical organisations, communications within the enterprise can be characterised as taking the ‘wheel’ form (see Williamson, 1975, p. 46), with workers at the ‘rim’ communicating with the ‘hub’, i.e. the monitor, and it is suggested here that non-hierarchical organisations with ‘all-channel’ communications between any pair of members on the ‘rim’ are feasible for operations on a small scale only.