Build A Better Business

Throughout the annals of history there have been countless times when the hallowed halls of Ivy League institutions of higher learning and the walleyed investors of Wall Street simply didn’t get it right.

Given the continuing economic uncertainty… This may be such a time.

As a business executive, entrepreneur or public servant you need to shift your focus from what isn’t working and make every attempt to refocus your attention on who and what is in fact working in these tumultuous times.

For there is a very specific group of business organizations that comprise virtually every segment of business and industry that are doing extraordinarily well… even in the New Economy. These unique organizations encompass supermarkets, engineering, construction, photography, staffing, holding companies, industrial components, manufacturing, architecture, electrical equipment, environmental services, dairy, retail, sporting goods, motel management, technology and more.

The common component that all of these companies regardless of size, stature or business classification share is that they are all “employee owned”.

Some of the household names of employee owned organizations that you are undoubtedly familiar with include Publix Supermarkets, Piggly Wiggly, W.L. Gore, Davey Tree Experts, Kinney Drugs and Graybar Electric.

Unlike traditional business organizations that employ a “top down” approach to their operations, employee owned organizations hold to a “bottom up” business philosophy that accommodates each employee’s status as an owner.

Publix Super Markets is currently the largest employee owned company in the United States with revenues of over $24 billion and more than 140,000 employees. Publix has the esteemed distinction of being one of the “100 Best Companies to Work for in America”. Publix stock which is tightly held by its employee owners, has (since the company first launched) grown twice as fast the S&P 500 index at a rate of more than 19% percent per year.

A ranking of the Top 100 companies by Fortune Magazine in 2009 revealed that 14% of the companies listed were in fact employee owned. Moreover, this trend and its underlying business model are on the grow globally. The John Lewis Partnership is a 81,000 employee owned corporation that owns the largest department store chain in England, the Waitrose Supermarket chain and other brands. Over the course of the past decade, JLP grew faster than Macy’s and in 2011eclipsed 13.7 billion dollars in revenue.

One of the organizational attributes that contributes to the success of employee owned companies is that the organization’s accountability is to the employees themselves and not a group of external investors or shareholders.

In like fashion, employee owned organizations take their mission and “value” proposition earnestly to heart. It’s no longer a meaningless platitude, rather it is a set of basic principles that everyone can believe in, take pride in and govern their individual actions by.

Employee owned organizations typically have excellent communications that flow freely throughout the organization while promoting ideas, creativity and innovation. As well, employee owned organizations generally have a unique perspective with regard to organizational alignment of talent, skills, experience and expertise. This occurs through the process of having those employees with the greatest levels of expertise in a given area of operation making or recommending the decisions for that portion of the organization’s operation.

As for the benefits of an employee owned organization, you need only consider the research performed by Harvard and Rutgers which confirmed that employee ownership fosters high performance, lower employee turnover, increased trust, greater shareholder value and long term sustainability.

Clearly, there is much to be learned from employee owned organizations that can be applied to your organization regardless of size or industry that will help you to build a better business.

Copyright © 2013 Developing Forward | Thomas H. Swank, CBC | All Rights Reserved.