SSHRC Project: Co-operatives in Transition: A Multidisciplinary Analysis of Member-Based Organizational Behaviour and Decision Making
The funding for this three-year project was received in the spring of 1998 from the Social Sciences and Humanities Research Council of Canada. The principal investigator is Murray Fulton, with Brett Fairbairn and Michael Gertler as co-investigators. The funding will help support the research of Rochelle Smith, the Centre's interdisciplinary PhD student.
Co-operatives in Transition - Summary of Proposed Research
As democratic, member-based organizations, co-operatives are experiencing a range of strains, stresses and tensions in their attempts to ensure their continued viability. These are primarily due to their attempts to provide economic benefits to members while also meeting their social goals. Co-operatives appear to be undergoing a new wave of adjustments and are adopting specific behaviours, strategies and organizational behaviours which bring into question whether they will remain co-operatives. Analysis of how co-operatives are responding to current challenges will provide lessons for other voluntary, democratic member-based organizations.
The basic question in this research is how co-operatives can respond to current challenges and changes while meeting members' social and economic needs. The impacts of the adjustments on organizational structure, member participation and democratic control, co-operative values and on co-operatives' contributions to community economic development will be examined. The research is of necessity interdisciplinary in nature. The study of co-operatives must incorporate economics, history, sociology, organizational behaviour and management, political science, and community economic development because co-operatives are multidimensional organizations. They have both economic and social goals and routinely trade off attainment of one to achieve the other. They are business enterprises and must be managed. They are democratic organizations which mirror the transitions and adjustments occurring in society and in the economy. Approaching the study of co-operatives through the lens of only one discipline allows understanding of only one dimension of these organizations.
The research will begin by examining the pressures, strains and stresses to which co-operatives are responding and the adaptive measures they are employing. A systematic review of existing theory will be done to identify the theories and concepts which will contribute to our understanding of what co-operatives are doing to adapt and change. Among the themes or concepts expected to contribute to this understanding are the principal-agent problem, the Prisoners' Dilemma, co-operatives and social movements, and co-operatives and community economic development. These themes may variously be found within the fields of economics, sociology, organizational behaviour and management, and community economic development.
The principal-agent problem speaks to the difficulty in exercising democratic control in decision-making in co-operatives. Democratic control implies that members' needs will be considered in all decisions affecting the co-operative, but in reality decisions in co-operatives are often made by people not directly affected by their outcomes. To what extent will the agent make decisions in the best interests of the principal? The Prisoners' Dilemma also informs co-operative decision-making and strategy in adjustment and transition. Co-operatives are about collective action. If the actions of individual members result in situations where their collective interests are not met, what measures can co-operatives take to mitigate this individualistic behaviour? Can new internal incentive structures be developed? Can co-operative values, which have historically mitigated individualistic behaviour, be strengthened?
Historically, co-operatives have not developed in isolation, but rather in connection with a wide range of social movements with a correspondingly wide range of purposes. Three components which are common in all social and co-operative institutions are identified; these are ideology, praxis (action) and organization. The triad formed by these components and the interaction between them provide a useful framework through which to analyze co-operative decision-making and adjustment.
The purposes of co-operatives and community economic development coincide. Co-operatives have played a strong role in community economic development and in community viability and sustainability. A critical question for co-operatives in transition is what impact their decisions will have on communities and their contributions to community economic development.
Four to six case studies of co-operatives in transition will be prepared for this research. Analysis of the case studies will be based on secondary accounts and primary sources such as the co-operatives' own documents and interviews. The latter will take the form of key informant surveys with elected and senior managers. Each case will be analyzed with respect to how members' economic and social goals were met, with particular attention to the degree to which each of the themes/concepts explains the adjustments made by co-operatives. This analysis will lead to construction of an interdisciplinary approach to the analysis of member-based organizational behaviour and decision-making.
Results will be communicated through publication of conventional academic manuscripts and summaries in more popular form, and workshops and presentations. Results are expected to be of interest to co-operative researchers and elected and appointed leaders of co-operatives, and to leaders, managers and others concerned with how member-based organizations in general can respond to transition.