Co-oppundit 2012

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Management

The factors

MANAGEMENT
“Managers of member-controlled enterprises need to not only possess those specific professional skills required to fulfil their responsibilities but they must also clearly understand that their main task is to work towards achieving the true purpose of the enterprise”

Management in co-ops & mutuals

The management, accounting, personnel and systems, all need to provide the enterprise with the capacity to achieve its purpose. It is essential that all managers fully understand the member-controlled enterprise model.

All concerned need to have the capacity to:

Encourage creative solutions
Focus upon resource optimization not profit maximisation
Provide accounting for purpose delivery
Focus upon reducing transaction costs
Provide essential purpose-related systems and procedures
Use only fully ethical approaches to both marketing and branding (where the member’ interests are paramount)

An Education Problem - Management Development
Our education system does not provide sufficient coverage of co-ops & mutuals and generally nothing is taught about the member-controlled enterprise model. The result is that most managers are ill-prepared to manage such enterprises. They often not only lack the necessary knowledge but they are also culturally unprepared and inhibited by their profit-orientated vocabulary

Members need to set the agenda

The fact is that 'the Management' knows a lot more about the business than the owners, this is equally true in both investor-owned companies and co-ops & mutuals. Frequently the Management pursues its own agenda, such as chasing growth to the detriment of shareholder returns in the case of companies, and member benefits in the case of co-ops & mutuals. This is because growth means a bigger empire, more status and higher pay for them.