Jakarta, CNBC Indonesia – What would happen if all workers or employees could become bosses, could not be fired, and received equal salaries? The majority of people probably think it's fictional. However, in reality it is not. This incident actually happened at Mondragon, a company from Spain that was founded in 1956.
On the official website, Mondragon is a company engaged in electrification and assembly. The company has three business areas, namely Solar Power, E-Mobility & Energy Storage and Automation. What differentiates Mondragon from the others is its operational model.
They adopt a cooperative model in running business. On this basis, many people call Mondragon the Mondragon Cooperative. This business idea originated from the thoughts of José María Arizmendiarrieta. In 1941, Arizmendi arrived in Mondragon (a city in Spain) and saw that many people were unemployed and out of school.
As a result, he founded a technical school consisting of residents. William Whyte in Making Mondragon (1991) explained that the school was successful in making citizens educated. However, the problem is that it is difficult for alumni to find work. From this problem, Arizmendi decided to create a company called Mondragon.
From its inception, the pastor always prioritized the principles of kinship and cooperation which later became the guidelines for the workers.
Power within Mondragon is not based on the number of shares, but based on the votes of members or workers. As a result, if you want to create a new policy in strategic areas and salaries, for example, then 80 thousand administrators will be asked to vote one by one. Waste of time, indeed. However, this is useful for absorbing all input so that there is nothing you don't like.
Apart from that, through the article “How Mondragon Became The World's Largest Co-Op” (2022) in The New Yorker, We can see that there is no single power in Mondragon's body. Everything is equal and tastes the same. Workers can be bosses and bosses can be workers, so there is no gap between the two.
In terms of income, the difference between high-ranking officials and ordinary workers is only 6 times. Not to mention, they will receive various kinds of incentives, such as health, education and family. Then, if the company makes a profit, then the workers can get the results because the profits will be shared equally.
However, if the subsidiary has a deficit, there will be no salary cuts. The solution is in the form of a loan from another subsidiary to the deficit subsidiary. One of these difficult stories occurred during the Covid-19 pandemic.
At that time, the company's stalled business required employees to cut their salaries. However, quoting New York Timesthis was not done because there was no will from the workers, who happened to be aware of their role as bosses.
“We can do this because each other knows the situation and realizes that they are the owners of the company,” said Mondragon President Iñigo Ucín, quoted from New York Times, Tuesday (30/4/2024)
On this basis, to lighten the burden, they volunteer to provide assistance and show an attitude of solidarity. They chose to temporarily reduce salaries and working hours. It is these attitudes that mean employees at Mondragon cannot be fired, unless they commit serious violations.
Things like this are what make Mondragon durable and always survive from crisis to crisis. Now, Mondragon is the 7th largest company in Spain. Its subsidiaries also exist in Brazil, China, Egypt and various other European and Asian countries.
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