Industrial democracy: Yugoslav style; the effect of decentralization on organizational behavior

321 Pages·1971·4.046 MB·English

by  Ichak Adizes

Industrial Democracy
Yugoslav Style

Industrial Democracy:
Yugoslav Style
The Effect of Decentralization
on Organizational Behavior
by ICHAK ADIZES
Assistant Professor of Administrative Studies
The University of California at Los Angeles
Fp
The Free Press, New York
Collier-Macmillan Ltd., London
Copyright © 1971 by The Free Press
A Division of The Macmillan Company
Printed in the United States of America
All rights reserved. No part of this book may be
reproduced or transmitted in any form or by any means,
electronic or mechanical, including photocopying, recording,
or by any information storage and retrieval system,
without permission in writing from the Publisher.
The Free Press
A Division of The Macmillan Company
866 Third Avenue, New York, New York 10022
Collier-Macmillan Canada Ltd., Toronto, Ontario
Library of Congress Catalog Card Number: 76-145823
printing number
1 2 3 4 5 6 7 8 9 10
To my parents
Salamon and Diamanta Adizes

Contents
List of Charts xiv
List of Tables xv
Preface xix
Acknowledgements
i
Introduction
1. The Goals, Significance, and Methodology
of the Study * 3
Goals and Significance 3
Methodology 6
Definition of Key Terms Used in This Book 14
2. The Environment and the Yugoslav Industrial
Organizational Structure 16
The Environment 16
The Economic Environment 16
The Socio-Political Environment 26
The Ideological Environment 28
The Self-Management Organizational Structure 32
Governing and Administrative Bodies 32
vii
Industrial Democracy: Yugoslav Style
1. The Governance Function 37
Referendum 37
Zbors 37
Economic Unit Councils 37
Central Workers’ Council 38
The Governing Board 39
2. The Administrative Functions 39
The Director 40
Other Executives 44
The Collegium 46
The Extended Collegium 46
Politikal Aktive 47
Informal Groups 47
Rotation and Organizational Pluralism 48
The System of Rewards 49
1. Basic Salary 50
2. Bonus on Individual Achievement—Workers 50
3. Bonus on Individual Achievement—Staff 51
4. Distribution of Profit—Economic Units 52
5. Distribution of Profit—Company Level 53
6. Distribution of Revenue 56
3. The Organizations Studied and Their
Output Measurements 61
The “Black Boxes” 61
Historical Background 61
The Administrative Organizational Charts
(Analyzing the Differences) 66
The Economic Output 73
II
The Decision-Making Process
4. Modernizing the Firm 81
The Process 81
viii
Contents
Illustrative Cases 90
Major Modernization in XYZ (Top-Down Strategy) 90
1. Achieving a Level of Saturation 90
2. Conceiving Alternatives 93
3. Obtaining Consensus—The Ripple Effect 95
Collegium Meeting 95
Extended Collegium Meeting 98
Politikal Aktive Meeting 99
“Spreading the Message” 102
Zbor Meetings 104
Workers’Council Meetings 106
4. Implementing the Decision 107
The Bottom-Up Strategy for Organizational
Change (at XYZ) 110
1. Achieving Saturation Level and Conceiving Alternatives 110
2. Obtaining Consensus 111
3. Implementing the Decision 113
4. Altering a Decision 114
5. Resolving Conflicts 116
Modernization of ABC 124
1. Achieving Level of Saturation, Conceiving Alternatives,
and Obtaining Consensus 124
2. Workers’ Council Meeting 126
3. Side Effects 127
Summary and Conclusions 129
The Process of Dealing with Short-Term
Uncertainty—Preparing the Annual Plan 133
The Process 133
Company XYZ—The Phases of Preparing the Annual Plan 133
Company ABC—The Phases of Preparing the Annual Plan 137
The Process in A ction 141
Planning Meetings at XYZ 141
Planning Meetings at ABC 154
Changes in the Process of Planning 157
Analysis 159
Industrial Democracy: Yugoslav Style
6. Labor Relations 165
The Law and the Practice 165
Hiring 166
Job Security 167
Disciplining and Firing 168
Participating in Labor Relations Decisions—
X YZ versus ABC 170
Case Studies 174
Bora, Junior Majstor 174
Strike at ABC 177
1. The Character of Yugoslav Strikes 177
2. What Happened at ABC 1 80
XYZ’s Permissiveness 187
A nalysis 189
Leadership Patterns and Labor Relations 189
Group Disciplining 191
III
The Environment and the Organizational Structure
7. The Self-Management System and the Changing
Environment 197
Recent Developments in the Yugoslav
Managerial Structure 198
Changes in the Environment 199
The Effect of the Changes on Organizations 200
1. The Effect on Executives’ Position 202
2. Survival of the Fittest (?) 204
3. The Importance of Leadership Qualities under
the New Conditions 205
Dysfunctional Results 205
“Contractual Management” 209
x