Employee Participation

For Employee Ownership Initiative

Employee Participation and Ownership Culture

 

Four coworkers standing around a table reviewing printed documents and a laptop in a bright office.

Employee ownership can improve workers’ financial well-being and how they contribute at work. But these things do not happen automatically. It takes time, and many people’s focused effort, to achieve these results. Employee participation and ownership culture are key to unlocking the benefits of employee ownership.

 

Employee participation includes many ways that employees contribute to their company’s success beyond just “doing their jobs,” such as:

  • Providing feedback on company policies and strategic plans
  •  Offering ideas for new products or services or improvements to existing ones
  • Participating in working groups to solve problems or envision new directions
  • Getting more involved in decisions about how the company is run

Ownership culture describes an environment where workers think and act like owners and feel a strong sense of accountability and pride in their contributions. Leaders can help create an ownership culture by:

•    Encouraging workers to freely contribute their talents and ideas to help the company succeed
•    Fostering an entrepreneurial mindset among employees 
•    Empowering employees to make decisions in their areas of expertise 
•    Respecting workers for their knowledge and commitment to the company

Employee participation is the foundation of ownership culture. Employees who are more involved are more likely to think like owners, and workers who think like owners are more likely to participate actively and do their best work.

Employee participation and ownership culture are essential to making employee ownership work. They help translate ownership on paper into meaningful, long-term benefits for both the company and its employee-owners. 

Open-Book Management

Two people reviewing printed charts and graphs at a table, pointing with pens during a discussion.

Open-book management (OBM) is a way of running a company that involves sharing financial information and empowering employees to use it to improve company performance. 

When workers understand how the business operates and have up-to-date information, they can make better decisions and stronger contributions to the company’s success. Companies often use OBM to encourage workers to think and act like owners, and many employee-owned companies practice it. OBM can improve employee engagement and company profitability, but it takes time and effort. 

OBM usually includes:

  • Sharing financial statements and operational reports frequently (daily, weekly, or monthly)
  • Teaching workers how to understand and use these reports
  • Focusing on a few key numbers that have a big impact on the organization or business unit and that employees can influence
  • Encouraging workers to be creative, proactive, and collaborative to improve these metrics
  • Letting everyone share in the rewards through profit sharing, bonuses, or employee ownership 

OBM works best when information is paired with education, shared appropriately (with sensitive information, such as individual salaries, kept confidential), and tied to results rather than participation alone.

Learn More

The following resources provide more information about open-book management. The U.S. Department of Labor does not endorse any of the companies, authors, or information listed.

  • Armstong, Rich and Baker, Steve. “Get in the Game: How to Create Rapid Financial Results and Lasting Cultural Change.” Advantage Media Group, 2019.
  • Case, John. “Opening the Books.” Harvard Business Review, 1997.
  • Lott, Joshua. “Pastrami and Partnerships.” New York Times, 2014.
  • Meinert, Dori. “An Open Book.” HR Magazine, 2013.
  • Stack, Jack and Burlingham, Jo. “The Great Game of Business, Expanded and Updated: The Only Sensible Way to Run a Company.” Crown Currency, 2013.