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Of course, there will be lots of criticism that such schemes "don't scale". This is a BS red herring that detracts from the real issue.

The general idea is for companies to be run as a democracy, like how governments are. IMO this is even more important than Basic Income. You spend 1/3 of your life working under these conditions, so why shouldn't corporations be democratic?

As for "implicit hierarchy" or "informal authority", yes that is partly the point. Not for positions of absolute authority to be ill-defined by top-down management which don't reflect reality; but for recognition and respect to be awarded based on actual merit. Cliques and inappropriate peer pressure might form (as claimed by articles about Valve not too long ago[1]), but you can deal with that another way, instead of resorting to hierarchy and absolute authority.

How do democratic governments work? That could be how corporations work.

[1] Whether or not actually true is a side point; the things it described certainly could happen and therefore are theoretically interesting




but for recognition and respect to be awarded based on actual merit

you can deal with that another way, instead of resorting to hierarchy and absolute authority

Could you elaborate on both of these please? I am incredibly doubtful that a meritocracy naturally springs up and enforces itself. How does that actually work when everyone is on board with that idea? How does it defend against people that are just in it for themselves from exploiting it?

You can make theoretical arguments that hierarchical management is the best form of management for meritocracy as well, but that doesn't hold up in practice either.

Right now your post doesn't do anything to explain why the "no management" model works, you just more forcefully assert that it does, and handwave away two of the readily apparent points it could go wrong.


> Could you elaborate on both of these please? I am incredibly doubtful that a meritocracy naturally springs up and enforces itself. How does that actually work when everyone is on board with that idea? How does it defend against people that are just in it for themselves from exploiting it?

Look at how many FOSS projects work. Look at how many hackerspaces work. People gain reputation for doing good things, and in turn they are listened to (gain soft authority). People that try to take over get ignored, or thrown out.

Yes, I know that the economics are a little different, since it's a lot easier to fork a software project. However, this gives us a base to work on top of.

> You can make theoretical arguments that hierarchical management is the best form of management for meritocracy as well, but that doesn't hold up in practice either.

Sure, all of this is theory and useless, we need people to try it. My point has always been "the counter points are invalid", to encourage people to try it.

> Right now your post doesn't do anything to explain why the "no management" model works, you just more forcefully assert that it does, and handwave away two of the readily apparent points it could go wrong.

I'm not handwaving them away; I am saying that they are not critical to being able to sustain a "no management" model. There are existing projects that work like this. The problems people mention are real problems that are either solved well, not solved well, or not all that important, but it is very rare for them to be critical, which is the common (invalid) argument.


> why shouldn't corporations be democratic

Probably because it doesn't work as well as the alternative. There are examples of this working here and there, but not many. The good thing about companies, as opposed to governments is that it's pretty easy to swap one out for another, without physically going anywhere. You can even start your own and try it out!


"Probably because it doesn't work as well as the alternative" is pure conjecture. The real reason is historic. In 200 BC, the only example of anything close to democracy would have been Ancient Athens.

edit: it's still not that easy to start your own company, and the common advice these days is to "not try a new structure", so your argument doesn't follow there either.


It got tried a lot in the 60ies, actually:

http://en.wikipedia.org/wiki/Cooperative

http://en.wikipedia.org/wiki/Worker_cooperative

Some of them have done pretty well. I think if they were that much better though, they would have outcompeted traditional companies.

> it's still not that easy to start your own company

So maybe the people that do so want to get rewarded for all the risk they are taking, and don't want to give equal shares and votes to the people who come later?

I know it's not what you meant, but it's very easy to start your own company, legally at least, at least in places like the US and UK.


> Some of them have done pretty well.

So you retract your earlier statement? :p

> they would have outcompeted traditional companies.

50 years is a very short time for a few companies to out-compete the tradition of the world. Companies from a few hundred years ago had horrific human rights abuses; only now do we see the general attitude being supportive enough of ethical issues to actually dissuade companies from going down that path, and even today this is only a minor effect.

> rewarded for all the risk they are taking

Then perhaps we also need ways of founding a company that doesn't need all the risk to be taken on by a few people.


> So you retract your earlier statement? :p

No. By and large, I think I'm right, but that does not mean there aren't a few exceptions.

> Then perhaps we also need ways of founding a company that doesn't need all the risk to be taken on by a few people.

We do! It's called the limited liability company or corporation, and it's one of the critical components of a modern economy. As an investor in a company, you can only lose what you put into it, rather than have someone come after all your assets. This is also how stocks work, at heart: a lot of people can each own a piece of a company, and thus pool a lot more capital than the founders could on their own.

Even that is still fairly risky and involves a lot of effort for which people want to be compensated if it goes well.

One of the nice things about companies is that anyone is free to go out and create one and more or less create it in the way they best see fit.


> By and large, I think I'm right, but that does not mean there aren't a few exceptions.

But your belief then is based on conjecture, as I said before. So is mine, but a positive belief (it can happen) is less strong than a negative belief (it can't happen).

We could look at the proportion of attempted co-ops that have failed, vs proportion of normal companies. That would be some interesting data.

> We do! It's called the limited liability company or corporation

This has nothing to do with your original notion of "risk" from 2 posts ago that you used to discredit co-operatives. There, we are talking about the reward split based on the risk split. Typical LLCs still have unbalanced ownership distribution.


Looking at proportions is meaningless: more people have tried and failed with regular companies because that's the default.

Let's look at how many of the world's leading companies are worker's cooperatives: very, very few. And this despite the fact that companies generally don't stay 'at the top' all that long. There is plenty of room for new companies in many fields.

> This has nothing to do with your original notion of "risk"

So what's your proposal? I don't really understand what you are discussing if you think it is not related.


> Looking at proportions is meaningless: more people have tried and failed

That's why I said "proportion", not "more". I agree the data would not be a firm indicator because there are lots of other factors involved, but it would still be interesting.

> So what's your proposal?

It's not a proposal, just an observation to counter arguments of "impossible" - if more people are more equally involved in funding a company, so the distribution of risk is shared, there is more incentive to create a democratic structure.


11 co-ops you didn't know we're co-ops: http://www.freelancersunion.org/blog/2013/12/05/11-co-ops-yo...


"edit: it's still not that easy to start your own company, and the common advice these days is to "not try a new structure", so your argument doesn't follow there either."

It is easy to start a business. You can buy things at thrift stores and sell them on Ebay for almost no startup capital.

I think the main reason I wouldn't run a company this way is because it's inefficient. A non-democracy can make decisions much faster and much more efficiently in the marketplace. Since this is the case, most companies would never do it. The only real ways is if every company were forced by the government..which would not end well for anyone.

Do we really need everyone in a company voting on product ideas/direction when many don't even know or care about it in the first place?

It seems, from your other comments, that you don't want to risk your own money and start a company like this (where everyone has a say)..you would rather force existing companies to use this structure..which is ridiculous.


> I think the main reason I wouldn't run a company this way is because it's inefficient.

Everyone thinks so (for no good reason I can see), so nobody tries. This doesn't mean the idea itself is actually bad.

> Do we really need everyone in a company voting on product ideas/direction when many don't even know or care about it in the first place?

This is a valid concern even for democratic governments. I don't think it's contradictory to the idea of a democracy. There are ways of making this work better e.g. weighted votes based on some criteria; I'm not interested in armchair-theorising about it though, we need to try it out and gather data on what works and then form theories about why.

> It seems, from your other comments, that you don't want to risk your own money and start a company like this (where everyone has a say)..you would rather force existing companies to use this structure..which is ridiculous.

I don't have enough money to risk this way. If I did, I would. "Force" isn't feasible, and you're extrapolating me here, but perhaps the market can apply pressure, in the same way you might boycott an unethical company. (As I noted elsewhere, this is more feasible today because you do actually have ethical alternatives, as opposed to a few decades ago.)


why downvote?


As far as I can tell, democratic governments largely work by people promising benefits that they have no intention of implementing (or sometimes, that make no logical sense) in order to get elected. Another tried and tested way to get ahead in a democracy is by convincing one segment of your population that another, usually less powerful segment is out to get them. It's been incredibly unstable in the short slice of historical time in which it's been tried.

The best feature of democracy is that they give an illusion of empowerment. You voted for someone put forward by a hundred thousand person organization, who maybe went on to get a job in an organization of several million people. So isn't that a government "by the people"? Yes, the real strength of democratic government is that it is good at propaganda.

In a company, where real results matter, resources are finite, and customers have alternatives, it is almost never used. This is despite the fact that most Western Europeans (and descendants) think democracy is the best form of organization ever. There's a reason for this.

This is precisely the reason that some geeks advocate turning government into a hierarchical corporate model, run by shareholder democracy - is the form of organization universally chosen when results matter[1]

[1] http://unqualified-reservations.blogspot.com/2007/07/why-whe...


I absolutely do not want a government to be a corporation interested only in money.

As clearly stated in that article, the US gov has weapons that are too powerful to be resisted. So we can't just stop paying them our taxes if we don't like their services. Capitalism in the US still depends on the US gov stepping in occasionally to break up monopolies when customers aren't able to choose between competing companies to give money to.




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