ILPC 2027

This paper applies labour-process analysis to the emerging empirical presence of the “self-managing” firm. Self-management here means the suspension of hierarchical control over the labour-process in the point of production, to varying degrees. Opposed to the existing research on worker self-management, the firms here discussed are decidedly market-oriented and privately owned.  The fundamental question this paper asks is whether at such companies control does in fact disappear, or whether it resurfaces in different unfamiliar ways.

The puzzling proposition of such companies can be characterized from two sides. On the one hand, we have Steven Marglin, who, in his seminal 1974 paper “What do bosses do?” argued that the “boss” has no inherent position in production. Which is why in the historical factory his function was created as one of “separation and control”. This is, of course, nothing new and can be closely related to the basic tenants of labour-process considerations, such as the transformation problem (Edwards, 1981:22) and the control-imperative (Thompson, 2010). The seeming loss of control in self-management is also perplexing from a different theoretical angle, namely that of New Institutionalism after Coase (1937) and Williamson (1996). For them the firm exists precisely because hierarchical orders can be more cost effective than using the market mechanism. A firm, therefore, is nothing more than orders and control.   The unification of these theoretical positions with the emergence companies that abandon hierarchical command and control authority is not straightforward. The problem can be explicated with an example: 

On March 14th 2013, the Guardian published one of many articles on Tony Hsieh, CEO of “Zappos”, one of the world’s largest online retailers. It explained the success of Hsieh’s company on the basis of its “culture of employee-empowerment and happiness” as well as its transition to a non-hierarchical organisational system known as “Holacracy”. This is a self-management strategy, which supposedly eliminates managerial control altogether. The fact that a very profitable, decidedly “market-oriented” company seeks to rid itself of hierarchies and bosses, wants its workers to self-organise and self-manage appears first and foremost as an oxymoronic proposition. This is especially true when the CEO of Zappos says he wants to turn all of his workers into entrepreneurs and replace the company’s hierarchies with markets. This, of course, is an evident tension for how can employees be employers and how can firms be markets? 

In the present paper this tension, if not phantasy, of “capitalism without bosses” is investigated in reference to four bodies of literature: Labour-Process Theory, Institutional Economics, “Continental” Sociology of Work and focused debates on the self-managing team, company culture and normative control. It is primarily, however, the propositions of labour-process theory that are to be applied to the research of this puzzle. Understanding the contemporary labour-process and organisation of labour, especially in contrast to the strict enforcement of industrial taylorist regimes in the global South, must include an understanding of the ambition this apparent phantasy presents. Especially, considering the increasing number of emerging hierarchy-less organisations, from Silicon Valley start-ups via worker-managed companies to one of the largest online retailers in the world.  

Methodologically, this paper builds on a qualitative research approach. Its analysis is based on the data of 25 semi-structured interviews at “holacratic” companies, 40 hours of non-participant observation and a case study of a self-managing financial service provider in London, all of which has been collected in the course of an MPhil dissertation at the University of Cambridge this year.   

The contribution this paper offers is, on the one hand, the extension of labour-process theory to a novel empirical instance, which has so far not been researched. On the other hand it combines theoretical discourses otherwise disjointed. Classical labour-process analysis is thereby connected to wider considerations of Political Economy, in line with the program of the conference. The findings of this research show that at self-managing companies, direct control can be relaxed in favour of something akin to what Friedman (1977) called “responsible autonomy” in order to produce incredibly efficient production regimes at the cost of the worker, who perceives his/her increased engagement in the company through a lens of identification, familiarity and responsibility for the team. The reason for implementing such strategies at companies was found to be related to pressures of valorisation, for example through financialisation. These findings help us gain an improved understanding of the general development of the labour-process in post-fordist/post-industrial economies and consequently their relation to economies of the global south.