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Creating an Ownership Culture

Noémi Giszpenc

May 2004

A company may work hard to create a participation system, engage in regular communications, and train managers in participatory skills. But how can a company get employees to participate effectively?

Everyone's experience and expectations about ownership are different. In order to build a positive, shared perspective among employee owners, workers and managers need to have a real, focused dialogue about the meaning of shared ownership.

One common difference in perspective between workers and managers is the appreciation of what the organization needs to do to survive and succeed. People often associate ownership with rights: for example, having the power to voice an opinion and watch people respond accordingly. But successful ownership entails both rights and responsibilities.

One mechanism to spur a dialogue on rights and responsibilities that should be considered is small group role-plays and discussion exercises. Ownership Associates has developed a series of such exercises, called Rights & Responsibilities Groups™, that are organized to provide realistic, useful, and provocative exposure to problems and dilemmas that exemplify the "real world" of business ownership. The fundamental objective of R&R Groups is to help participants attain an appreciation of the necessary balance between ownership rights and responsibilities.

The Practice of R&R Groups

R&R Groups make use of scripted dilemmas that portray typical "real-life" tensions and problems facing actual business owners. A trained small-group discussion leader keeps the environment safe and confidential. Employees and managers "role-play" several perspectives and hear directly from their peers about how effective they are at resolving the dilemma at hand. Theories about what is right, fair, and responsible are brought out into a safe public setting.

A Model Dilemma: Tonar Graphics

Tonar Graphics is a 20-year old, fast growing, computer software business catering to business and technical markets. In 1989, Tonar's founders Bill and Sarah Stern instituted an ESOP that now holds 40% of the company's stock. Helen Murphy is a new Product Development Manager at Tonar's recently opened Worcester, Massachusetts office. She is a college graduate in her mid-twenties with an impressive background in computer sciences and business principles.

The Worcester office is doing very well, thanks in large part to a deal that Helen worked out with the local university-affiliated hospital to try out several new blood-testing data software programs. Tonar Graphics' older offices in Cambridge, Hartford, and New Haven are holding their own.

Helen recently came across a copy of Tonar's latest consolidated financial statements. She noticed the differences in profitability among locations, and brought it up to the Worcester office manager, Phil Fine. "We've got enough to worry about from the competition these days. Let's keep our eyes on the rear view mirror for a change, instead of our pocketbooks," Phil responded.

At the next management meeting, Bill could see that Helen was not herself. "Is there anything wrong, Helen?" Bill Stern asked. "Well, Bill," Helen responded, "not really, I guess, well, maybe there is, but I just don't know how to bring it up or whether I should, but I got a look at our recent financial, and well, maybe it isn't my place, but I'm afraid I think that we Worcester people might be getting the short end of the stick on things. After all, our profits constitute almost 40% of last year's earnings, but we're just one of four locations. Shouldn't we be getting a bigger piece of the pie?"

Bill and Sarah Stern looked at each other. Their combined sacrifices over 20 years had made the Worcester investment possible, and they were being questioned by a 25-year-old who happened to be brilliant, basically a good person, probably a key to the future of the enterprise, and also an owner. Sarah Stern spoke up. "You're raising an important point here, Helen, but I'm afraid we don't have time to get into it just now. We'll talk to Phil about this and get back to you all with some information at a later date."

The Group Discussion

R&R dilemmas such as the Tonar Graphics case are deliberately staged to lack clear, simple-minded answers to the problems they pose. Should Helen's perspective be listened to? Could a recruiter afford to alienate people like Helen? On the other hand, Helen does seem to be ignoring the historical investment of others that have (at least partly) made her success possible. How should she be "taught" these lessons?

Each of the participants in these fictional dilemmas may be said to have a legitimate point of view that probably mirrors the "real life" points of view of R&R group participants in their workplaces. The key here is to give these different perspectives some "air time" through the discussion process, so that participants can publicly contrast the various legitimate points of view represented by the characters in these dilemmas.

How R&R Groups Fit Into the Bigger Picture

The lessons of R&R Groups are not the kind necessarily learned in one or two sittings. Small group discussion experience with R&R Groups should be at least an annual ritual for every employee-owner.

R&R Groups can serve as an extremely useful prelude to substantive "real-life" discussions of company policies. But they are intended to be primarily an educational tool that can help to foster the development of the particular social and cognitive skill of taking perspective. The actual application of these new perspective-taking skills may involve an entirely different natural work setting, a departmental or company-wide meeting, for instance, not necessarily the R&R Group itself.

At a minimum, R&R Groups should lead their participants to be able to better comprehend the points of view or perspectives of other group participants. Such increased comprehension can provide the foundation for better quality communication, tolerance, and respect for the points of view of others. At a maximum, however, R&R Groups, particularly if combined with "ownership skills" training in basic financial concepts, could, over time, lead to a qualitative advance in individual and group perspective-taking abilities and to a more sophisticated grasp of complex business principles.

Ownership perspectives have to be learned. Employees need "practice" to learn to be owners. R&R Groups are a form of ownership practice. Combined with effective communications and employee participation programs, they can help deliver on ownership's bold promises.

This article was adapted from Christopher Mackin, "Creating an Ownership Culture," published in the fall 1990 issue of the NCEO's Journal of Employee Ownership Law and Finance.

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