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WORKER COOPERATIVE BUSINESS MODEL

Based on the Mondragon Experience and others

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Common Corporate Model

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< Corporate Heads< Middle Management

< Workers

PrimaryDIRECTION OF ACCOUNTABILITY

STAKEHOLDERS

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This system used to work because…

• The owners carry the weight of business expenses, decisions, and risks (liabilities) allowing workers to focus on specific tasks.

• The owners pay for employee benefits – medical, dental, time off, etc.

• The owners are looked up to for handling disputes and making things run smoothly.

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But the system is failing because…

• Business is getting too complex. • Productivity is down• There is less engagement at work

• Workers have trouble getting enough hours or enough wages.

• They are miserable and complain more.• They are actively disengaging.• Incentives aren’t motivating people as they once did.

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The battle between the two pillars of management

• Hard – Structures, processes, systems, metrics, etc.

• Soft – Feelings, interpersonal relationships, traits, etc.

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TEDTalk - Yves Morieux: As work gets more complex, 6 rules to simplify http://bit.ly/1eFHbJv

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Cannot be balanced when solutions…

Require organizing for a competitive advantage…• Cutting overhead while fulfilling new requirements• Adding new systems, strategies, functions…• Updating equipment and re-educating employees

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Which often takes precedence over…

The interplay of how the systems fit together…• Is the new process making it easier or harder on the

workers?• Can the work be done more efficiently and with less

cost to the consumer as well as management?

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Morieux’s solution…

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COOPERATE

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What did we hear earlier?

• No hierarchy means cooperation

• Democratically operated• Decisions made by consensus

• Workers enjoy working• And…• Customers liked shopping there• Stability of location• Have medical/dental benefit packages

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What cooperatives have we seen so far?

• The Cheeseboard, Berkeley, CA• Arizmendi Bakery, Berkeley, CA• Rainbow Market, Berkeley, CA• Inkworks Progressive Printing, Berkley, CA• The Sleepless Goat Café, Kingston, Ontario, Canada• Rebuilders Source, Green Worker Cooperatives, S. Bronx • Your Local Market Co-op, Stratford, Ontario, Canada• Others included: Ireland’s Cooperative Support Services, Gavin &

Co. Accounting, Suma Wholefoods, JustBooks Collective, Dublin Community TV, Belfast Cleaning Society, Meitheal Mid West (promotes worker cooperatives in Limerick, IR); in San Francisco Other Avenues Food Store Co-op, Tech Collective, A Taste of Denmark Bakery; and in Oakland Mandela Foods Co-op

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Not all cooperatives are small

• Evergreen Cooperatives http://evergreencooperatives.com/• Evergreen Laundry – launched 2009• Evergreen Energy Solutions – Incorporated 2008• Green City Growers – officially opened on 2/25/2013

• Mondragon Corporationhttp://www.mondragon-corporation.com/eng/

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• Basque region of Spain • Arrasate/Mondragón, Guipuscoa province• 2007 pop. 22,112

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Mondragon Corporation

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Mondragon Corporation1956 – Don José María Arizmendiarrieta founded Talleres Ulgor (FAGOR Electrodomésticos S. Coop.)

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Ulgor’s first product: paraffin heaters Initial funding: local organizations & private investors

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Mondragon Corporation

• Town councils of Mondragón, Arechavaleta, Escoriaza and Oñate

• Provincial Savings Bank of Guipúzcoa• Provincial Council• Chamber of Commerce• Ministry of Education• local companies• family men • associates

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Mondragon with FAGOR in center

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Mondragon Corporation12/2012 – 80,321 worker/owners in 289 companies and organizations

Areas of finance, industry, retail and knowledge

Talk aboutEmpowerment!

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Mondragon Model

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Built from top-down• College• Fagor – industrial• Bank• All others followed

The supportive infrastructure became fertile ground for the growth of many autonomous cooperatives.

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Worker Cooperative Structure

Based on the Mondragon Model and others

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< Core & Basic Cooperative Principals

SUPPORT MECHANISMS

MARKETPLACE

] worker-owners

Business Direction & Market Adaptability

Direction of Accountability is Organic

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Mondragon’s Annual Congress

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• Mondragon cooperatives operate in accordance with the “Statement on the Co-operative Identity” maintained by the International Co-operative Alliance.

• The ICA was founded in 1892, headquartered in Geneva, Switzerland.

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Mondragon Corporation

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ICA Statement of Cooperative Identity

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A co-operative is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.

Co-operatives are based on the values of self-help, self-responsibility, democracy, equality, equity and solidarity. In the tradition of their founders, co-operative members believe in the ethical values of honesty, openness, social responsibility and caring for others.

1. Voluntary and Open Membership2. Democratic Member Control3. Member Economic Participation4. Autonomy and Independence5. Education, Training and Information6. Co-operation among Co-operatives7. Concern for Community

VALUES

PRINCIPALS

Definition

__________________________________________________________________________________________________________

http://ica.coop/en/what-co-op/co-operative-identity-values-principles

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Where would you rather work?

Here?

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Or here?

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What type of businesses make good worker cooperatives?• Accounting firms• Antique stores• Appliance stores• Appraisers• Architectural firms• Art Galleries• Auto repair• Bakeries• Banks• Batting cages• Bed & Breakfasts• Beekeepers• Bicycle shop• Building supply stores• Business supplies• Butchers• Car dealerships• Car washes• Carpentry shop• Cemeteries• Clothing store• Computer repair• Construction contractors

• Consultants firm• Convenience stores• Craft supply stores• Cyber Cafe• Dance studios• Daycare centers• Deli products• Delivery services• Drycleaners• Entertainment agents• Event Coordinators• Farmer’s markets• Feed stores• Fish market• Formal wear rentals• Furniture stores• Gas stations• General stores• Graphics and web design• Grocery stores• Groomers• Gun shop• Hotels

• Housecleaning business• Housesitting services• Insurance sales• Jewelry stores• Kitchenware stores• Landscapers• Laundromats• Law firms• Lending locations• Medical & Dental care• Miniature Golf• Motels• Network business• Newspapers• Nurseries• Office rental services• Office supplies• Optometrist• Painters• Party rentals• Pet stores• Pharmacies• Photographers

• Pottery stores• Print shops• Recycle-Upcycle shops• Rental yards• Repair shops• Restaurants• Retail stores• Roof Installations• Secretarial services• Senior care assistance• Shipping services• Shoe stores• Sign painters• Sporting goods store• Storage units• Theatres• Tile & Flooring stores• Training centers• Transportation services• Travel agencies• Trophy stores• Warehouse rental

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BRAINSTORMING

(work+shop)

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We want to fulfill Three Objectives1.Create a team for the

Foundation Support Group2.Create new business ideas

for our community3.Create a team for our first

conversion cooperative

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Part 1 – What businesses do we need here?•Something you go off the hill to get?

•Something you think is missing here?

•Something you would love to do here?

•Maybe that venture you’ve always dreamed of and just haven’t gotten around to doing?

•Perhaps a complement or supplement to an existing business (raw materials, services)?

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Part 2 – Consolidate our ideas1.Combine like businesses on a

single large paper.2.What type of business(es)

could each group of interests become? Write it/them across the top of one half-sheet leaving ¾ of each section blank. (Categories and sub-catgories)

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2. Children’s Boutique

Part 2 – Example1. Auto Mechanic

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Part 3 – What abilities can you offer?•Personal work experience?•Your favorite pastime or hobby?

•A skill you want to learn or improve?

•Something you know others are doing and would like to build upon?

•Resources you have access to that could assist the community?

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2. Children’s Boutique

Part 3 – Example1. Auto Mechanic

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Jim SmithKeith Bowen

Mark ThompsonJoe Harding

Karen Sharp

Ella StevensMary Jennings

Jennifer Teal

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Keynote Talk

Flavia Krieg

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Finally – What’s Next?1. We’ll process the data you’ve compiled.

2. We’ll contact you individually and send you the contacts for those with like interests.

3. There is a follow-up gathering next Sat. Feb. 1, 10 AM, Little Red School House on Step #1 – Feasibility Studies. We’ll let you know more details when we contact you.

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Finally – What’s Next?MY FOCUS…

Continue to promote Worker Cooperatives as a local economic solution.

Foundational Support Group & Website(AnzaBusinessCenter.com)

To provide speakers and resources for new worker cooperative start-ups and business conversions.

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To solicit interested and skilled workers to share in the conversion of my existing graphics and web design business.

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Two quotes of Empowerment…

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“Whatever the mind can conceive, and believe,

the mind can achieve.”

Napoleon Hill

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“…no heart has ever suffered when it goes in search of dreams,

because every second of the search is a second’s encounter

with God and with eternity.”

The Alchemist

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