The challenge of competitiveness in Worker Co-operatives in Britain

Abstract

This study responds to the need for further research on worker co-operatives as an alternative business model following the resurgence of interest in co-operatives by many international organizations including the United Nations. The study particularly seeks to fill the gaps identified in the previous research studies with regard to worker co-operatives’ competitive environments and to their strategy formulation processes. The main objective of this thesis is to establish that an integrative strategy framework offers a more effective analysis of the challenge of competitiveness in worker co-operatives in Britain. Unlike most previous studies in this field, the point of departure for this thesis is the contention that the challenge of competitiveness in worker co-operatives in Britain can be better understood if their strategic variables are considered together in an integrative strategy framework. The thesis aims at finding the rationale for formulating strategy frameworks that integrate variables from both the external and the internal environments of the worker co-operatives in order to effectively achieve objectives. This thesis additionally seeks to establish that despite all the external and internal forces that work against the growth and development of worker co-operatives in Britain, they still perform very well and are satisfied with their performance. This would confirm that a non-hierarchical management structure based on the principles of democratic control actually works. It would also confirm that loyalty, commitment and greater participation from members (co-operative environment) is the main force behind worker co-operatives’ successful performance. The thesis utilizes a typology for strategy classification that identifies the strategic variables in both the external and the internal environments that are critical to the competitiveness of worker co-operatives in Britain. It specifically focuses on the strategic integration of the key variables in worker co-operatives’ environments and the strategic alignment of their internal environment (e.g. financial, physical and entrepreneurial) with their external environment (e.g. social, economic, political and legal). The thesis additionally examines how worker co-operatives are influenced by a unique environment that arises from their strong adherence to the universal cooperative principles and core values. This unique environment, known as the co-operative environment, consists of the multi-faceted relationships that exist between worker co-operatives and their members and among the members themselves. According to the Worker Co-operatives Statistical Review 2nd Revision 2005, which is published by Co-operatives-UK (the umbrella body for worker co-operatives), there are approximately 390 worker co-operatives in Britain. One hundred and thirty one (131) of these worker co-operatives participated in the research study. The research method adopted for the thesis integrated the quantitative data collection and analysis methods with the qualitative and, hence, more descriptive approaches. Interviews were conducted and survey questionnaires were also completed on various factors that influence the competitiveness of worker co-operatives. The study concludes that the use of an integrative strategy framework provides a richer picture of the challenge of competitiveness in worker co-operatives in Britain. It also concludes that many worker co-operatives attribute their satisfactory performance to loyalty, employee empowerment and unparalleled commitment from the members. This confirms that a non-hierarchical management structure based on the principles of democratic control actually works and that the revival of worker co-operatives in Britain will be maintained, and will probably expand.