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Observations on Employee Ownership

If Great Places to Work Are So Successful, Why Are There So Few?

Corey Rosen

May 16, 2011

(Corey Rosen)If a practice succeeds in the marketplace, over time, it will become the norm. That, at least, is what most of us were taught if we took an economics course. The market rewards good ideas and punishes bad ones.

Well, not always. As Loren Rodgers reports in his May 16, 2011, Employee Ownership Update, the most comprehensive analysis ever of the relationship between workplace practices and corporate performance confirms what has been found again and again in prior studies: companies that reward fairly, have minimal supervision, and lots of employee involvement in work-level decisions perform much better than those who don't.

Yet if you look at the over 4,500 mutual funds in the U.S., you will not find a single one that uses workplace practices (such as being on the "100 Best Companies to Work For" list) as its selection criteria. But it is worse than that. Having been a board member of the Great Place to Work Institute and a judge for Winning Workplaces, I can tell you that given the prestige of these awards, only a surprisingly small few hundred companies apply each year, and the ones in the bottom half or so of the applicants are, frankly, not that impressive. Job dissatisfaction levels are at all an all-time high, and over half of surveyed employees say they are thinking about looking for another job in the next year (most won't, but it is a good measure of unhappiness).

There are many reasons why companies are not making what seems like the obvious choice to be a better workplace, but these seem most compelling to me:

It's all rather disheartening to me at times, and I need a good dose of an employee ownership conference to remind myself that there is another model out there.

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