Workplace Democracy

South Mountain’s New Path To Ownership

October 3, 2022 by John Abrams 2 Comments

On a rainy September day, 18 South Mountain (SMCo) non-owner employees gathered in our meeting room. After two years of collaborative design, our Communications Coordinator, Abbie Zell, stood in front to unveil our new Path to Ownership program.

It includes 33 experiences designed to give new employees, over a seven-year timespan, a complete picture of what South Mountain is, how it works, and how to be an effective owner. The purpose is two-fold: to develop active and engaged SMCo Owners and to strengthen relationships within the company.

SMCo transitioned from a sole proprietorship to a worker co-op in 1987. There are currently 21 co-owners. In the worker co-op realm, we are known to have one of the longest waiting periods before Ownership eligibility: five years from the start of employment. What happens during those five years has just changed dramatically. Not in terms of training and work progress – SMCo has always had a robust employee evaluation system and some degree of Ownership preparation. It’s the experience leading to Ownership that has changed with this launch. Our newest employee, Jake Martin, said that it made him feel that he had joined an organization that doesn’t perceive him as a worker but rather as a member of a community. Mia Esparini, hired in 2019, said, “I love it; I’m so excited to see it unfold over time.”

ORIGIN

Abbie tells about the source of the idea:

“In 2019, Deirdre and Siobhán attended a four-part webinar on Open Book Management hosted by The Democracy at Work Institute (DAWI). During one of the segments, Jen Briggs (formerly of New Belgium Brewing) presented the social system New Belgium uses to support Open Book Management and promote greater governance participation.

At the time, we had just made three second-generation hires. We could envision all of them as future Owners and knew there was more recruitment ahead. The size of that ‘incoming class’ posed a significant opportunity to improve upon an important process.”

Deirdre elaborates,

“Becoming an Owner has historically happened mostly by osmosis; by the time you had been at SMCo for five years, you were assumed to know what you needed to know. We wanted to encourage more active preparation, particularly during the two years before Ownership, hoping that would develop more engaged owners.”

DEVELOPMENT

Deirdre remembers,

“We charted a seven-year progression (five before Ownership, plus two after). We thought specifically about leadership development – how to cultivate a culture of taking responsibility for the company every day, in every way, no matter your role.”

Abbie continues,

“Ready to take this further, we formed a working group (Deirdre, Siobhán, myself, and John) and started brainstorming:

the essential experiences which would foster an appreciation for South Mountain’s culture

The technical knowledge required to be an informed owner and good decision-maker

The opportunities we’d like to provide new employees during their early years

I had become an Owner less than one year before this. By contrast, Deirdre, John, and Siobhán had lengthy tenures. We each brought something different to the table, and after a couple of months, we had a comprehensive list and cohesive concept to present to SMCo’s Leadership Team and then to our graphic designer (Magnifico Design).”

CONCEPT & ACTIVITIES

Abbie explains,

“We chose Path as the central metaphor because it has a clear beginning, can meander, has progress markers along the way, a guide when necessary, and a reward at the end.

The Trail Map (click here to view in full) is a physical manifestation of the Path. It is the size and style of a national park passport and works along the same lines. Each new employee will get one; when they complete an experience, it will be initialed by their instructor. Everyone will work through the booklet left to right until there are no experience left. . . at which point, they’ll be a seasoned South Mountain Owner!

Experiences are dispersed among six levels: Basecamp, Setting Out, Exploring, Practicing, Achieving, and Mastering. Approximately half the experiences will be undertaken alone; the others will happen in groups.

The full program involves 34 hours spread over seven years. Fifteen current owners will guide participants through their areas of expertise, and I will oversee the program and act as liaison between participants and guides.

We’ve folded Path to Ownership into our onboarding process, so those hired from now on will start the Path on their first day of work.”

As Abbie distributed the 4×5” “Trail Maps” and explained their significance, there was palpable excitement in the room. Abbie’s joyous presentation style provokes that, but the concept and content speak for themselves. One new employee, Nic Esposito, said, “it was so great to gather and be exposed to that so early in my tenure. I love the passports – classy and tangible – that we will use to chart our course.”

This is a remarkable new initiative. Over time, I predict, it will alter the culture of the company – making the experience of being an employee (and an employee-owner) richer and more complete. It will build trust, encourage cross-pollination, and spread knowledge across our four departments. It will prepare developing leaders and new owners for the future in an intentional way.

It’s clearly going to be a lot of fun too. It makes me wish that instead of retiring at the end of the year, I was a new employee just being hired! (“We’ve got this new guy applying for the open carpentry job. He’s 73. Should be a perfect fit!”).

The Flip Side of Mitch

February 26, 2020 by John Abrams 8 Comments

Sometimes we are fortunate enough to catch glimpses of progress within our federal government (yes, there is some – despite Mitch McConnell’s relentless efforts to assure that nothing positive happens in Congress, he does not always succeed!) I had this chance several weeks ago.

In August of 2018, Trump signed a 788-page defense bill which authorized $717 billion for the military. Hardly anyone noticed that New York Senator Kirsten Gillibrand slipped in a provision to help workers own their companies – a modest attempt to tackle wealth inequality, and a timely one.

As baby boomers reach retirement age, we are undergoing a “Silver Tsunami” – several million small businesses in the U.S. stand at a crossroads: What will happen to them when their founders move on? Some will be passed down to family members. Some will be absorbed by larger companies (and likely, moved out of town). Some will close their doors. Others will explore the increasingly popular notion of selling the business to those employees who helped build it.

There are obstacles. It’s not uncomplicated. Gillibrand’s bill – the Main Street Employee Ownership Act of 2018 – was designed to help employee-owned companies gain better access to technical assistance and capital. On February 12th of this year, the House Committee on Small Business held a hearing to examine how the bill is working, how it’s not, and how it can be improved.

I was invited to testify as a representative of the worker cooperative model, along with two individuals who represented ESOPs (Employee Stock Ownership Plans) and one who represented a cooperative bank.

The experience was an eye opener.

The room held a significant sampling of the Democratic and Republican representatives who comprised the Committee. Chairwoman Nydia Velázquez of New York opened the hearing with this remark: “At a time when income and wealth inequality are at record levels, real wages for middle class workers are nearly stagnant, and retirement security is no longer guaranteed, one way to combat these problems is through the employee-owned business model.”

She displayed a firm grasp of the issues and a strong commitment. She knew her subject. I was impressed.

Each of us had five minutes to testify. My peers were knowledgeable and passionate advocates.

Mark Gillming, senior vice president at Messer Construction in Cincinnati, praised the tax advantages (passed by congress 45 years ago), which have caused the ESOP model to become widespread:

When I began working at Messer Construction, it was a medium size, family-owned construction company with a long history and a good reputation; but, like most companies in construction, it had little in the way of employee benefits.

In 1988, the last son of the company founder died, and we found ourselves with an uncertain future. The grandchildren of the founder wanted access to their wealth and, having no connection with the employees, were not committed to maintaining employment at the company. In 1990, the Messer employees were able to buy their future from the Messer family, using the ESOP structure. We could not have purchased the company if not for the important tax advantages that the ESOP model afforded us.

Our country’s investment in ESOPs allowed ninety-nine Messer employees to purchase their future; and the engagement that opportunity created, has resulted in growth. Messer now provides quality jobs and predictable retirement for over 1,200 individuals and has company-funded retirement assets for those employees totaling more than $400,000,000.

R.L. Condra, VP of Advocacy and Government Programs at the National Cooperative Bank in Arlington, Virginia, spoke to the changing nature of cooperatives and those who stand to benefit:

A prohibitive policy requirement by the Small Business Administration (SBA) is hindering the growth of the cooperative business sector. If this issue is resolved, lending institutions, like the one I work for, will be able to make loans that will help to grow small businesses, create quality jobs at increased wages, and provide healthy food and grocery options for communities throughout the country.

Cooperatives have evolved since the 1960’s when the SBA recognized them as buying clubs. There are now over 40,000 cooperatives in the US and the top 100 generated $222 billion in annual revenue in 2018. Some notable cooperatives include REI, ACE Hardware, Ocean Spray, Land O’Lakes, and Congressional Federal Credit Union.

Since the great Recession, worker cooperative numbers have doubled, and have become a business option for young people, women and minorities. According to the 2019 Worker Cooperative Economic Census, 50% of owners of worker co-ops are Latino and African American, and 62% of women make up the majority of the workforce.

Daniel Goldstein, President and CEO of Folience, a media company in Iowa, advocated for regulatory clarity that would lower the risk for businesses making the employee ownership transition:

I submit that the biggest obstacle to the formation and expansion of ESOPs is the chilling effect of the U.S. Department of Labor’s (DOL) actions. DOL has perpetuated an absence of formal regulatory guidance, while simultaneously pursuing a litigious approach to oversight. The effect has been a deep chill on the market.

Every year, hundreds of business owners who want to learn about ESOPs attend educational events hosted by The ESOP Association. And once exposed to the lack of clear guidance, many turn away out of fear that some unknowable misstep will invite never-ending DOL scrutiny.

Those fears are not unfounded.

Today, more than 45 years after ESOPs were established with the passage of ERISA, the Department of Labor has yet to finish its rulemaking process. They started. They nearly finished in 1988. But they never issued final regulations.

Operating without clear guidance is a risk ESOP companies should not be forced to bear; it is a risk that negatively affects the wealth and security of the 10.6 million employee owners DOL has been tasked with protecting.

But here is the travesty: It is impossible to prove how many American workers have lost the opportunity to become employee owners as a result of this chilling effect. And, due to the rapidly escalating retirements of baby boomer business owners, there is urgency to reduce the chilling effect this lack of regulatory clarity is causing.

And then it was my turn. I emphasized the value of employee ownership in our culture and the importance of sharing what we have learned:

I believe that owning our work is as essential to a good life as it is to own our homes. As former Treasury Secretary Lawrence Summers once remarked, “In the history of the world, no one has ever washed a rented car”. When employee owners are making the decisions, it is more likely that companies will stay rooted in place and be positive forces in their local communities.

Economist Richard Wolff says, “if our workplaces had been democratized, long ago, would the workers have stopped raising their own wages? Hardly. Would they have destroyed their own jobs by moving production overseas? Doubt it. Would they have employed technologies that pollute the local environment? No, they live there. Would they have allowed some to earn astronomical salaries while the rest got no raises? No way. Our economic history over the last thirty years would have been radically improved if we’d had a different way of organizing our enterprises – with a more cooperative community-focused method that is democratic at its core.”

Growing the worker cooperative approach has the potential to positively affect the economy, our democracy, and the quality of working peoples’ lives. It is not a stretch to say that the benefits of the democratic workplace may even aid and influence the essential repair of our battered civic landscape – it could change, in effect, the chemistry of our culture. If you spend your days working in an environment of collaboration, mutual respect, and shared power, it is bound to spill over into other parts of your life – better parenting, more civic engagement, kinder relationships.

The value and benefits of employee ownership continue to fly under the radar, and you can’t take this important step without knowing the option exists. So perhaps the greatest need is extensive education and publicity – the stories of employee ownership successes need to be shared and celebrated. Employee ownership “ambassadors” should be funded to visit companies who are considering transitions – to teach, train, advise, and inspire. Widespread technical assistance should be made available. Employee ownership should be the number one business succession planning option.

But it’s not. I hope this committee will build on the good work it has begun and I am grateful for the opportunity to make this request.

After our testimonies, the representatives asked questions. Good questions. Engaged questions. It felt worthwhile.

Government can work. We know that; we can remember when it did. My experience in Washington amped up my resolve to work hard this year to elect a real president, help democrats take back the Senate, and increase the number of voices involved in decision making. There’s never been a moment when it mattered more. Not in my lifetime.

As for South Mountain’s commitment to employee ownership: we make our Operating Policies, Bylaws and Employee Ownership Toolkit available online and are always happy to help other companies find their way. If you have questions, feel free to contact me at jabrams@southmountain.com – but please read our Toolkit first. It may answer some of your questions. Or it may answer some and provoke others.

The Amicus Cooperative – Stronger Together

June 29, 2018 by John Abrams Leave a Comment

South Mountain is proud – and lucky – to be one of the co-owners of the Amicus Cooperative, a collection of 50 of the most progressive solar companies in the U.S.. Amicus exists to support smaller regional solar companies by leveraging national scale purchasing power, sharing best business practices, and combining collective brainpower. My colleague Rob Meyers, who manages our Energy Services division, never misses their semi-annual gatherings. I have gone twice, once in 2015 in Phoenix and once this year in Denver.

It is not an overstatement to say that both times the Amicus group took my breath away. The intelligence, the heart and soul, the culture of civility, humility, humor, inquiry, fellowship, and friendship at these gatherings are extraordinary.

We’re happy to be able to share this piece about Amicus written by Sarah Stranahan, a senior editorial associate at The Democracy Collaborative and a leading member of its Fifty by Fifty employee ownership team.

The Democracy Collaborative is another remarkable organization which does cutting edge research and “works to carry out a vision of a new economic system where shared ownership and control creates more equitable and inclusive outcomes, fosters ecological sustainability, and promotes flourishing democratic and community life.”

Good stuff all around. These are important below-the-radar antidotes to the sorry, sleazy, sadistic mess of national politics today. – JA

Amicus Solar Purchasing Coop Spreads Employee Ownership
Achieving Scale while Maintaining Local Impact

By Sarah Stranahan

Amicus Solar is one of more than 250 purchasing cooperatives in the US, including such well-known brands as Ace Hardware and Best Western Motels. By forming a large national cooperative, small producers or retailers increase their purchasing power and access to project financing, while remaining independently owned and operated. An additional benefit, it turns out, is that a purchasing co-op can be a particularly effective means of spreading employee ownership.

Amicus Solar was founded in 2011 by six independent solar companies, including employee-owned cooperative and certified B Corp Namaste Solar and South Mountain Company. Amicus Solar is led by cooperative veteran and former Namaste Solar employee-owner, Stephen Irvin, who serves as its president. Today Amicus includes 48 local and regional solar photovoltaic (PV) installers and developers who openly share and collaborate on a wide range of business issues, from operational efficiencies to sales and marketing strategies.

Similar to Best Western and Ace, Amicus is democratically owned by its members, 40 percent of which are B Corps and a growing number of which are employee owned. With five Amicus members having joined the cooperative as employee-owned companies, Amicus has made a conscious effort to educate its members about worker ownership. As a result, five member businesses (ReVision Energy, Technicians for Sustainability, SunBug Solar, Positive Energy, and Sunlight Solar) have converted — and another five are considering converting — to either become worker coops or employee stock ownership plans (ESOPs). The purchasing co-op has become a means of “industry contagion” — a way of rapidly spreading employee ownership.

Staying Local While Creating a Competitive Advantage 
Since the Great Recession, there has been an increased interest in localism (also called subsidiarity) — the principle that decisions should be made at the lowest practical level or closest to where they will have their effect — because small, local impact-driven businesses have three key advantages for nurturing a more democratic and sustainable economy:
They invest locally, capturing and multiplying value, particularly when they sell locally produced goods;
They are more successful at participatory management because it is easier to cultivate personal trust and accountability in small-scale, local organizations; and
They are more likely to care about and be accountable to their communities in terms of environmental health, social equity, cultural vitality, and good governance.
Localism, however, faces challenges when it comes to economies of scale, which can increase efficiency and reduce the costs of production. Scale is also required to meet the needs of densely populated urban centers, where a larger and larger portion of the world’s population lives.

Small solar installers have faced intense competition from large national companies such as SolarCity (recently acquired by Tesla), SunRun, and SunPower. By coming together in a purchasing co-op, the relatively small businesses that own Amicus Solar have leveled the playing field with their larger competitors, particularly in terms of purchasing power, while maintaining the advantages of staying local.

New Ventures 
In addition to taking advantage of cost and marketing efficiencies, Amicus members share best practices and develop joint strategies to advance their common goals. For example, in 2016 Amicus won a $358,000 grant from the U.S. Department of Energy to found a new cooperative to provide high-quality operations and maintenance (O&M) support to large-scale solar installations. Today Amicus O&M Cooperative includes 20 member organizations that have set collective operations and management standards to ensure that commercial and utility-scale solar PV systems fulfill their performance expectations over the long term. Amicus O&M Cooperative is being led by another cooperative veteran and former Namaste Solar employee-owner, Amanda Bybee.

In 2017, Amicus members helped found the Clean Energy Credit Union (CECU), which received the first federal charter for a new credit union in Colorado in 31 years. CECU’s mission is to promote clean energy, environmental stewardship and cooperative enterprises through the financial services it offers its members. Using the federally insured deposits of its members, the credit union provides consumer loans to reduce the cost of clean-energy products and services. “We envision a world where everyone can participate in the clean-energy movement,” said board chairman Blake Jones, co-founder of Boulder-based Namaste Solar. This new federally chartered credit union will make it easier for people to both invest in and use clean energy in order to help protect our environment and improve our economy.”

Jones is leading another venture in this growing ecosystem called Kachuwa Impact Fund, which has provided capital in support of multiple Amicus members. Kachuwa’s mission is two-fold:
(1) To provide privately held “impact companies” with mission-aligned, long-term, and non-controlling capital; and
(2) To provide “impact investors” with diversified, impact investment opportunities outside of Wall Street.
Kachuwa’s multiple “impact themes” include cooperatives, certified B Corps, and companies that are owned by employees, women, or people of color. Kachuwa itself is aiming to convert to an investment cooperative structure in 2019 and, among other things, to increase its support for companies converting to employee ownership both within the Amicus ecosystem and beyond. Improving access to values-aligned capital is a critically important part to growing the cooperative and employee ownership movements.

Democratic Governance 
According to Irvin, president of Amicus, Namaste Solar has had powerful influence on the culture of the purchasing coop and its members. It was at Namaste Solar that Irvin learned about cooperatives, democratic processes and governance, and the importance of facilitating a process to reach consensus. Like Namaste Solar, he says, Amicus uses an open-book management policy to keep everyone fully informed and a committee structure to facilitate decision making.

Irvin told Solar Pro magazine in 2014, “[Open-book management] is important since the members are equal owners. Consensus building can take time — but once we’ve come to a decision, you see more engagement and commitment from everyone.”
Democratic governance has not only contributed to the purchasing co-op’s success, but has shown members that ownership, mission, governance, and culture matter. Today Amicus Solar is an important driver of employee ownership across an entire industry.

The SMCo Equity Journey

July 30, 2015 by John Abrams 6 Comments

I recently attended the Eastern Conference for Workplace Democracy in Worcester MA. Worker co-ops from around the country were represented. As I listened to people relate their struggles to align values with business, it made me think of our good fortune with one aspect of our company: our owners’ equity fund.

In 1987 SMCo transitioned from a sole proprietorship to a worker cooperative. Part of the re-structuring was a commitment to profit sharing – we would distribute 35% of annual net profits as cash bonuses to each employee, based on hours worked. The purposes: to share the wealth (of which there wasn’t much at the time) and to partially mitigate our hierarchical wage scale.

In addition, our new by-laws called for the distribution of annual dividends to internal capital accounts for each of the co-op owners. Generally, these distributions were (and are to this day) roughly 50% of the remaining net income after profit sharing.

The internal capital accounts are paper accounts; they do not have cash in them. They are an obligation – the company owes the money to each owner/employee when that person leaves the company.

Two Pats on the Back

October 25, 2014 by John Abrams Leave a Comment

September was a month of recognitions for South Mountain.

I’m always of two minds about awards and prizes.

They feed the perverse (in my view) competitive impulses of our culture and our education system. The implication is that there are winners and losers – the worthy and the less so – when our attention should focus on each of us doing the best we can. All deserve to be recognized for their unique accomplishments.

But some awards have special meaning because they embody learning opportunities and inclusiveness at the same time as they hold some achievers out as particular examples. During the past month SMCo has received two of these.

The Great Place to Work Institute named SMCo as one of the 50 Best Small and Medium Workplaces.

And the B-Lab named SMCo as one of their “Best for the World” companies for 2014.

The processes that led to these two recognitions are worthy of examination. I will try to do that in a way that is not overly self-congratulatory, with the knowledge that I am likely to fail.

When Great Places to Work first contacted us two years ago and asked us to go through the application process, we looked at it and went “Whoa. This is hard. A ton of work.” And we declined.

This year we looked at it again. Two things occurred to us. The first is that we felt that the work to assemble the information they require would be a useful exercise for us – the introspection demanded would point to new and better ways we can improve who we are and what we do. A learning opportunity.

The second was our appreciation for the heart of the process – an anonymous survey they conduct with each of our employees. Submissions go directly to them; we do not see them. We thought it would be interesting for our employees to have that opportunity to express themselves freely about the company. We liked that everyone has a voice; it’s inclusive.

So we decided to do it.

The work was useful, and it was nice to be named, but the most rewarding part of the process was that the Institute provided us with a selection of anonymous quotes from the employee survey.

Here are just a few:

“I have never before worked at a place where it seems that 100 percent of the people love their job. Turnover is almost nonexistent, and I felt so lucky when there was an opening for a position. I truly like to spend time with the people I work with every day. “

“The goal is to get your job done the best you can, but family comes first. “

“This company has a great reputation because we give back to the community. It makes it a place where everyone is proud to work.”

“There is a very strong sense of all-for-one and one-for-all.

“The people that work for the company are what makes it so unusual. When I first started working for the company, everyone was so nice, helpful, genuine and laid back that I thought something must be wrong. After a couple of weeks, I realized that’s just the way everyone is.”

“We have extraordinarily good and generous mental and health benefits, and outstanding opportunities are given to employees to shape and change their job descriptions and roles within the company. “

“We are an employee-owned company. Personally, this makes a big difference! Having worked in ‘corporate America,’ I know that the difference is real and profound. It is so great to have a say in everything, from the big decisions to the small.”

“It is a ‘choose your own adventure’ experience. Dream it and make it happen.”

Here is the full write-up that Great Places did about South Mountain.

B-Lab is very different from Great Places.

It is a non-profit that certifies companies as “B Corporations” based on a variety of factors including corporate accountability and transparency, treatment of workers, community practices and environmental practices. Their rigorous process includes in-depth examinations of company practices and documents. SMCo received B Corp certification in 2008. We have been re-certified twice since then, and over 1100 other companies have been certified to date in the U.S. and 34 other countries.

Until now, we have had no real standards to differentiate good work from good marketing. B-Lab provides exactly that. B-Corp designation is like LEED Certification among developers and the Fair Trade designation among product suppliers.

The “Best for the World” designation is applied to the highest scoring of the companies that have gone through the certification process.

One of those is SMCo.

So there they are. Two nice recognitions. Two pats on the back. We all need them from time to time, whether we like it or not (which we do!).

Yes, Indeed, it was a Zinger!

February 11, 2013 by John Abrams Leave a Comment

Last week I traveled to Portland Oregon. It wasn’t only to get a wonderful day of skiing at Mt. Hood with my fine old friend Jonathan Orpin. It wasn’t only to stay with Jonathan, Maxine, and son Jake River at their beautiful Vermont Street house. And it wasn’t just to get a dose of Portland culture, hang with the downtown dirtbags, and sample some of the great food from the hundreds of food carts parked around the city (outta- this-world food and teeming with life – it makes you feel like you’re in Kowloon).

All those were good.

But the reason for the trip was to meet with the 19 members of the Partners Group who own the Zingerman’s Community of Businesses in Ann Arbor, MI. Zingerman’s is one of the great stories of today’s business world, a hopeful harbinger of the Next Economy. The partners manage nearly 600 employees and the eight distinct businesses have combined annual revenues of $46 million. They are all food-related (and educational) and they are all in Ann Arbor.

Over time the Zingermans (Paul Saginaw and Ari Weinzweig, the co-founders, and their partners) have steadfastly resisted the temptation to franchise their stellar brand. Instead they have expanded at home, and they now consist of the following: the flagship Deli where it all started in 1982, Zingerman’s Bakehouse (bread and pastries), Zingerman’s Creamery (cheese and gelato), Zingerman’s Roadhouse, Zingerman’s Mail Order, Zingerman’s Candy Manufactory, Zingerman’s Coffee, and ZingTrain, the education business which “shares the Zingerman experience with forward-looking organizations around the world.”

For the last 6 months I have been communicating by phone and e-mail with Ari. He and a small group of partners have been designing a plan to transition Zingerman’s to an employee owned worker co-operative. When the plan is implemented they will become one of the largest worker co-ops in the U.S.

The partners were gathering in Portland for a three-day offsite retreat, partly to discuss the co-op design. Ari had asked each of them to read my book, Companies We Keep, and asked me if I would come to react to their governance and business transition plan.

I was thrilled to have the opportunity to meet and think with such an extraordinary collection of people so brimful of honest intelligence.

It was quite a day. The dialogue was good. Although I was the only outsider in the room I felt comfortable there. It was relaxed but productive. Funny and philosophical. They work together with remarkable flow – tackling big issues with such passion and commitment to excellence (using first-rate meeting facilitation provided by Fran Alexander of Alexander Resources) that they are able to allow the great and the grungy and the elegant and the messy to all co-exist at once in the service of a greater good.

They’re not only competent and principled; they’re courageous too. For several decades all policy decision-making has been by consensus – not an easy thing to do in a large dispersed network of businesses. The two co-founders have veto power, but they have never used it yet.

And now they’re transitioning to a worker co-op. That takes courage too, or (as in our case when we did it 25 years ago) pure naiveté! And naïve they are not.

When I asked Ari and Paul if I could write about what they are doing (given that they are still in process and I didn’t know if it was public knowledge) Ari thought it would be fine and queried Paul who said, “Sounds just fine to me. That’s the power of putting the vision out there. It imposes accountability on us all to execute, preform and succeed.”

Now that’s the way to run a business, isn’t it? Fearless and transparent.

They also have a publishing house, called Zingerman’s Press. Ari has been writing consistently for at least the last decade. Two of his most recent books are ZINGERMAN’S GUIDE TO GOOD LEADING, PART 1: A Lapsed Anarchist’s Approach to Building a Great Business and PART 2: A Lapsed Anarchist’s Approach to Being a Better Leader. He’s a good one, and these are thoughtful and engaging books that mix humor and wisdom as they introduce the reader to the methods and madness that led to Zingerman’s emergence as a powerful force in progressive business.

Paul reminded me that we had met once before, at a Business Alliance for Living Local Economies (BALLE) conference about five years ago. I remember that I was immediately impressed when he was talking about principled business and said, “But principles aren’t really principles until they cost something.”

Like everyone else, apparently, I asked Ari where the name came from. It’s a long story, and a good one, and he gave me the whole thing. You can hear it from him, but I’ll tell you one good part. After they had finally decided on the name Zingerman’s, says Ari, “one thing we still weren’t sure about was whether we should spell it the European way, with two ‘n’s or with one. Paul called his grandfather to ask his opinion. Didn’t take him but a second to decide: ‘with one ‘n’, of course, so it’ll be easier for them to write the checks.’ Paul’s grandfather was a very wise man.”

And so are the folks at Zingerman’s, who represent long haul, next economy thinking at its best. We at SMCo appreciate this new association.

And we appreciate another one, too.

In December we hosted Blake Jones, CEO of Namaste Solar, – a 100-person worker co-op solar company in Boulder, CO – for several days of information exchange between our two companies. Namaste is far younger than Zingerman’s, but equally inspiring. Next post I’ll talk about Blake’s visit.

Good Year for Worker Co-ops

January 14, 2013 by John Abrams Leave a Comment

On the last day of 2012 our 25^th year as a worker cooperative (and 37th in business) ended. It was an extraordinary year – rich, full, profitable, demanding, restorative, and uplifting.

It was a year of many “first-evers”. On November 1^st we welcomed three new owners at SMCo – the most ever at one time. When DonE Turnell, Marc Rosenbaum, and Aaron Beck became owners, it meant that 21 of our 30 full-time employees are now full owners. DonE worked here for 20 years before taking the buy-in plunge, our longest journey-to-ownership ever. And it goes back further – I can remember him as a 14 year old skate punk back in the early eighties. He hasn’t changed much. After his first SMCo Board meeting, he said, “It was kind of like a road association meeting but with less stupid people.” Less stupid people? Hey DonE, what are you trying to say??

B-Corps on the Move!

December 10, 2012 by John Abrams 9 Comments

On July 31, the last day of this summer’s legislative session, Massachusetts became the 11^th state in the country – along with California, New York, South Carolina, Louisiana, and 6 others – to pass legislation enabling businesses to register as a new type of corporate entity: Benefit Corporations, or B-Corps. Benefit Corporations are companies which consider the public good – factors such as environmental sustainability and community benefit – in their corporate decisions rather than financial return only.

According to the Boston Globe, “To rein in the excesses of capitalism without losing the dynamism that makes it hum, a variety of thinkers have begun looking for ways to re-imagine the corporation itself, restructuring it to encourage businesses to pursue not only profit, but also positive social impact. One of those innovations will hit Massachusetts December 1st, when companies here will be able to register as a new entity called a ‘benefit corporation.’ ”

Milestone for Mike. . . and SMCo

October 12, 2012 by John Abrams Leave a Comment

Last week we had our first official retirement party. Mike Drezner became the first SMCo employee to reach retirement age (and actually retire!). He came to work as a carpenter in 1985 and stayed for 27 years.

I can tell you one thing: when he first came he sure wasn’t a carpenter. He wasn’t even very handy (if you know what I mean) and he wasn’t young to be just starting out – pushing 40. He had been a teacher – a damn good one I’ll bet – and had traveled a lot. But carpentry? None.

So why did we hire him?

I don’t know. Just a feeling. He asked, or maybe his wife Liz did, I can’t really remember. I do remember that I was still on the fence about being in business, and I hadn’t really learned much about saying no. So I said yes. It was about who he was not what he was.

He didn’t exactly take to carpentry, not right away anyways. What size nails did you say for this decking? he would ask, over and over. 8 penny nails Mike, same as last week. He was dogged and determined, but it came slowly. He made up for it in so many ways they’re hard to count.

He was as reliable as the tide. He cared about people. He was steady. He was a great member of every crew he worked on. He was a calming influence for all. He was a student of the world, and how it works. Still is. And he became an excellent carpenter, but so much more as well.

He was an important part of our Personnel Committee. Later, he was a charter member of our Management Committee. A closet stock market maven, he stepped up and shouldered the stewardship of our pension fund and our equity fund. This was huge.

Both funds have prospered under his steady hand. They dipped in 2008 (like everything else in our madhouse economy) but came back strong (like us). There is now over $3.5 Million in the two funds, and we are beginning to look at ways to gradually shift from socially responsible investing to socially responsible local investing.

At the party we gave him a beautiful bowl turned by shopper Ken.

And Deirdre produced a beautiful book signed by each of us called The Drezner Years, with photos of people he worked with, projects he worked on, and a brief tribute.

And he doesn’t know it yet but the ratty old nail apron he wore for years is off getting bronzed at this very moment.

Mike could not have been a better co-owner. As much as anyone he embraced the concept that we are a group of individuals, all of whom matter, but we are also another entity, The Company, which matters even more. He gets the true meaning of workplace democracy, through and through.

For me, his counsel was invaluable. We often disagreed, and still do, but the disagreements are most remarkable and noticeable because we share so many points of view and have so much in common. I always come away from the resolution of our disagreements wiser than before. You can’t always say that about people you disagree with, right?

I treasure the work that we did together and I will always honor his influence and value his friendship.

I hope his retirement is just what he wishes it to be and I’m thrilled that he will stay on the SMCo board to continue the work we began so long ago. He will also continue to manage our two funds as he gradually passes that baton to Ryan Bushey (an architect managing a money fund? Uh oh).

Mike’s retirement is also a reminder that the gradual transition to SMCo’s second generation that we refer to so often isn’t just talk – it’s what’s happening, here and now. It’s like climate change – not an abstract thing that’s going to happen in some distant future but a set of changes we are living with right now. I like thinking about SMCo’s next generation more than I like thinking about climate change, but the point is that both are becoming more and more a part of our present.

As for Mike, he’s irreplaceable, and he will not be replaced, because he’ll be staying with us in so many ways.

Happy Thanksgiving to All

November 24, 2011 by John Abrams 5 Comments

It’s early Thanksgiving morning. I’m the only one awake. I’m looking forward to family, friends, and food later.

I’m looking back to yesterday. It was the one year anniversary of my wife Chris’ brain surgery. Last night, as we ate dinner with a friend, I remembered following the ambulance from Woods Hole to Boston at high speed. I was wondering, as I swerved onto Route 24, if it was all just a dream. A nightmare. It wasn’t; it was the real deal.

Co-ops in the Rise

December 7, 2009 by John Abrams Leave a Comment

I’m still excited about the budding alliance between the United Steelworkers (USW) and the Mondragon Cooperatives – and the general awakening consciousness about worker co-operatives and co-operative business in general that I wrote about last month.

And there’s more.

An Historic Alliance

November 10, 2009 by John Abrams 7 Comments

My friend David Smathers of the TeamWorks Cooperative Network in California writes:

“The Mondragon cooperatives and the United Steelworkers have announced an historic partnership through which they will buy or start manufacturing businesses in the U.S. and Canada that will combine Mondragon’s democratic structure of ownership and governance with collective bargaining.

It will take many years to implement. But particularly in the face of the economic crisis that has exposed Wall Street’s failure to provide responsible stewardship of the economy, this is a very heartening development. Together, these two institutions have the resources, technical expertise, and vision to demonstrate to the public that it is possible to structure and run large corporations in entirely different ways than what we have become accustomed to.”