Democratic Management Means Smarter Business Decisions

Democratic Management

SMEs have a great advantage over their larger counterparts, in that it’s easier to instigate a culture in which everyone’s views are heard. There are several business benefits to be derived from this democratic approach to management, which ultimately result in a healthy bottom line.

1. Voting

It might seem a strange concept in business, or one that is difficult to implement on any kind of scale, but allowing employees to vote on company decisions ensures that they not only accept these decisions, but actively drive change in the selected direction. I can personally vouch for this approach, having been elected to the position of CEO by my colleagues.

There are plenty of employee management systems which facilitate bottom-up company management in this way, and allow the whole team to feel much more engaged in the business and its decisions because they have a sense of responsibility for the outcomes. In an SME, without the layers of management that enterprises employ voting ensures that ideas and input are derived from a wider range of people, helping your business make informed decisions that are backed by all employees.

2. Recruiting

Most SMEs can’t justify having a full-time member of staff to manage recruitment, but often SMEs are the most likely to be increasing their headcount, in fact they are five times more likely to hire candidates in the next quarter than large corporates. But outsourcing this business critical process to a third party isn’t necessarily the most practical option.

Often recruitment agencies struggle to fully grasp what it is you are looking for in terms of skills and company fit. The people who understand the requirements of the role best are those who will be working alongside the new recruit. Giving employees more control over the recruitment process, letting them design adverts and liaise directly with candidates applying to their department, ensures all new recruits are a good company fit and ultimately resulting in improved staff retention.

3. Choosing

The modern workforce is full of ‘slashers’, or people who have had a variety of careers. This means that many of those within your organisation will have a range of skills, some of which are being under-utilised in a strict job description. Allowing employees to choose which projects they work on makes the most of these ‘extra-curricular’ skill sets and fosters a wider culture of collaboration, driving better results. More choice and flexibility results in improved job satisfaction and ultimately a more productive team. Beyond this ‘swarming’ to preferred projects, it eliminates the need for middle management, as team leaders differ based on the needs of the project in hand.

4. Training

Employees often know what they need to learn in order to better serve the business. Giving them control over their training and professional development through cloud-based solutions means they take ownership of their own learning, and become a more valuable commodity to your business. The more skills they learn, coupled with their existing company knowledge, the more value they can add. Access to these kinds of services also fosters greater company commitment from the employees you invest in.

5. Reviewing

The annual review process is frequently a drawn out and costly process. Often, by the time employees receive their feedback it is outdated. Giving employees the tools to self-evaluate regularly rather than annually, and to solicit instant feedback, gives them the opportunity to identify and address issues without HR involvement.

Regular feedback and self-evaluation for employees are key drivers of overall company success, internal software tools and employee platforms are key in supporting this management approach. This is critical in an SME as, especially in the early stages, many don’t have the budget to employ full-time HR staff. Using web portals gives employees access to the data the company holds on their performance, and encourages them to act on it.

It is employees that really drive the success of any business, and they are more effective when they feel valued and engaged. Democratic management allows SMEs to reduce the need for dedicated HR staff, recruit and retain staff more effectively, improve productivity and eliminate costly middle management.

Haufe-umantis AG_Marc Stoffel_CEO (3) (800x532)

Marc Stoffel, born in 1982, has been Chief Executive Officer (CEO) of Haufe-umantis AG in St. Gallen since June 2013. He is responsible for the management of the company, holds full responsibility for sales and watches over the company's partnerships. Since 2005, Marc Stoffel has shaped the company, acting in various positions of responsibility: in the areas of software development, product management, sales and marketing. In 2009 he added to this the overall operative responsibility for sales and partnerships. Prior to his employment with Haufe-umantis, he acquired experience in various companies within the software sector, having studied Computer Science and Economics and having completed an MBA in Entrepreneurship. In 2007, Marc Stoffel won the Hilti Förderprize for the most innovative Master's thesis written.