Sometimes, it's just a cigar

This is our truth, tell us yours

Co-operate or die

The spectacular implosion of the Co-operative group in the UK has become a touchstone for all those who think they know best about how to run a business.

On one side you have the ‘only one model of a successful business’ brigade, who argue that the co-op must become more like a conventional PLC. On the other side, getting much less publicity, are those who think the problem with the co-op was that it wasn’t co-operative enough, that its unwieldy governance and introverted activist group was doomed to fail.

The failure of the co-op is clear and obvious – it tried to grow quickly by deal making, and like Northern Rock before it, it failed as ingenious deals and funding schemes that looked almost too good to be true proved to be, well, too good to be true.

The governance structure of an organization does not matter if it pursues strategies that are high risk and whose risks cannot be mitigated. It really is that simple. The Co-op bought Somerfield shops – there was a good reason why they were up for sale. It bought Britannia Building Society without realizing that Britannia’s commercial loan book was evidence for the old bankers proposition that there is nothing worse than being the last banker to arrive on any particular street.

Co-op customers have no reason to see the co-op as being anything special, or different. It has become just like all the other retailers, and all the while new entrants to the market have outflanked it.

I have interests to declare here. I am a member of my local co-op, and a supporter of their political arm, and I have formed or been a member of numerous co-ops in my time. The problem, bluntly, is that the co-operative movement, as in the retail arm, became staid, slow moving and resistant to change. It closed ranks and became introverted, convince of its own moral superiority and blaming declining standards of belief amongst the population for its own declining customer base. In short, it had, and has, a death wish.

The need for co-ops to adapt and change is clear, and there are effective co-ops doing just that, but all too often the traditional co-op movement look at them as being somehow tainted by new ideas or the dreaded sickness of innovation from below. At its heart, the co-op is a bureaucratic, slow moving, ancestor worshipping monolith, as relevant to today, and as misunderstood, as Stonehenge.

If the purpose of the Rochdale Pioneers was to provide pure food at fair prices and honest weights and measures (a quote from the co-op museum website) then @MsJackMonroe is more relevant to their purpose than Paul Myners*. To an insider who feels, when he speaks to other co-op members, like an outsider, the co-op has abandoned its original purpose and adopted self preservation of the organization as its sole and abiding purpose.

If this blog has a coherent political stance, it is one that is about socialism from below; not because of adherence to dogma, but because socialism from above has failed, and if there is one thing even the most anti-capitalist activist can take from capitalism, it is that organizations that do not listen to their customers  and stakeholders are far more likely to fail.



*This isn’t just a rhetorical point. When I worked with friends on a food co-op, providing fruit and veg boxes on a deprived estate in a bottom 10% local government ward (as measured by the Index of Multiple Deprivation) we quickly realized that the biggest barrier to take-up of the scheme was that many parents didn’t know what to do with fresh, unprepared veg.


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This entry was posted on March 15, 2014 by in Uncategorized.

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