There is a really cool new project for business blogs called More Space being developed by Todd over at A Penny For… (Brendon over at Slacker Manager turned me on to it). I’ve submitted the following proposal for consideration on being the 10th blogger invited to participate in the project. My proposal is to write my essay on the Transforming Unions theme that I mentioned I wanted to work on here – so I’ve decided to go ahead and post the proposal here for comment, whether I am accepted on the More Space project or not. Any thoughts?
More Space Essay Proposal
By Phillip B. Wilson
It is easy to ignore unions today. They represent less than 1 in 10 private sector employees; they used to represent nearly half of all private sector workers. The average businessperson may simply shrug and wonder, “who cares?” when hearing these statistics. They view unions as just another artifact of an industrial economy. Yet, no matter your personal feelings about them, unions can offer an important and vital voice to workers, an often-underrepresented constituency in our economy. Further, the decline of unions offers lessons for all businesses and their survival depends on a radical transformation. If unions do survive, their transformation will offer even more important lessons for business leaders.
Observers sympathetic to unions offer a number of explanations the decline, focusing mainly on factors outside the control of unions (management hostility, legal obstacles, politics). These explanations, while tempting for labor leaders to adopt (after all, it places the blame somewhere other than on themselves), are largely irrelevant. This essay highlights two meta-trends that best explain labor’s decline. The essay also suggests how unions, and more broadly all organizations facing declining customer bases and shrinking markets, can transform themselves into vital, growing and important organizations once again.
The first meta-trend at play is economic conditions created by the globalization of the world economy. Unions, of course, often cite this as another reason for their decline; however, they get its impact exactly wrong. Companies have been forced by economic conditions (in order to remain competitive in increasingly global markets) to provide wages, hours and conditions of employment that, while perhaps less than what monopoly unions may have negotiated in their heyday, far exceed levels that significant numbers of employees would consider unsatisfactory (what I term union “benefit pre-emption”). In addition, companies in these highly competitive environments have very little flexibility to offer significantly improved conditions without hurting their competitive positions (what I term union “market pre-emption”). Simply put unions (as they have traditionally imagined their role) have less and less to offer private sector workers.
The second meta-trend relates to the fundamental narrative that informs virtually every labor sympathizer’s view of what makes unions necessary. The basic narrative of union supporters is that in a capitalist economy the incentive of representatives of capital (managers) is to provide the worst work conditions that available workers will accept, thereby maximizing the return on capital. The role of unions in this narrative is to achieve the best deal possible for labor – often at the direct expense of capital. It is a “zero-sum” game, and negotiations in this narrative are a “war” where one side wins and the other loses. This view of the role of management and labor, if it was ever true, is totally inconsistent with the view most workers and managers have of their mutual relationship today. This, by the way, is an important reason that the message of most union organizers does not “resonate” with many workers today.
This essay argues that both meta-trends have transformed the environment for organizing unions in the private sector. If unions are to ever be successful in organizing in the private sector (absent direct and unprecedented intervention by the government in supporting unions), they must confront the reality of these two meta-trends. Successful unions in the future must adopt a much different view of their relationship with both companies and members.
• The relationship with members must be re-defined as a worker resource association – in other words unions should provide benefits to members (whether or not employed by companies with legal bargaining obligations) that they demand; health care, child care, legal advice, financial services and the like.
• The relationship with companies must be viewed as that of organization development consultant. Companies must view unions as potential business partners that, in their role as representatives of labor, can help to improve the productivity and efficiency of labor.
For members the new unions provide resources they need and act as facilitators who assist with resolving disputes and, more important, provide employees a share of the profits earned through productivity enhancements. Labor in this role does not threaten management by withholding labor; instead its threat is simply that without its help management is leaving unrealized productivity and profitability on the table. Workers in this model are, in effect, already withholding their labor albeit unknowingly and unintentionally. This narrative is more positive for workers, unions and companies. This model also offers companies the opportunity to re-imagine their own relationship with their customers, suppliers and, of course, their workers (whether represented by unions or not).
