Monday, February 20, 2012

Labor-Management Business Ideas

Finally Frank is starting to delve into more than just beginning examples. Although decently put together (or at least I thought they were) the only one I truly had issues with was his beginning understanding. Now I may be misinterpreting it and if I am please point this out to me at the next meeting but example or subsection regarding the labor-managed firms and the reason why they fail. First of all as an accounting major, the idea a business would relinquish control of their management to all workers is a little odd. Since I am taking managerial accounting I would be more skeptic on their strategies they would provide as a business to let control, what I would only hope, of the majority of the decisions that managers would have to face monthly.
First off lets look at the benefits. Solely the increase in production by 15% and suggested profit of 10%. Interesting, despite the fact that the pay is not increased but the measure of purpose within the store that gives a 15% boost to production. Then Frank complains about the banks not lending the money to those stores or businesses for little reason. Shrugs off the notion by suggesting that the business may have their employees too occupied in meetings and so they miss them and give up on the ideal. But rather I would like to pose another motion.
I believe that the individual workers themselves may impose a negative externality when it comes to decision making. Although it is well and good for those workers to feel that their work is more of a concern for them that they are there as a board of leaders, I think an issue of business understanding is lost among employees. Negating intelligence or any other factors that could be considered insulting I believe that the information managers receive from sales software from registers and expenditures should be dealt with according to those who would be more responsible to handle them. Also time is a factor of this as well. Before anything can be established in this sort of business it would first have to go through the meeting which might cause this decision to be hindered rather than immediately dealt with by the middle-management.
Yet my expertise in labor-managed firms are truly limited. I have nor studied, or grew up with them to say that I know them indefinitely. But it seems to me that the time and knowledge of the middle or say upper management is far more crucial regarding decisions related to finances, marketing, etc. There is a company however in Australia there is a software company that allows their employees to take on day off a quarter, to come to work and do nothing but to think of new software or products. They could fool around a little bit but at the end of the day they had to produce their results to the upper management. Remarkably they have found various new selling software that would never been thought of if they didn't have this sort of tradition. Now i'm not trying to portray that I am two faced about this idea or argument. But when it comes to a business I believe it would be best if some business dealings should be handled by the ones who are trained and responsible for it.

1 comment:

  1. I have to agree with your argument. I will give credit to Frank for starting to make sense. However, the fact that he shrugs off the notion that there are more leading factors in why the banks aren't lending money to businesses. For example sole proprietorship ran business contain a lot of unlimited liability. this plays one key role in why it is harder for them to take out a loan from banks. Let's not forget the sub-prime loan scandal that also took place a few years ago. Some the responsibility should be given to those who have more experience than just the employees.