Factors for Success of a Worker Cooperative Here are some things to consider when planning a worker cooperative or trying

to improve an existing worker cooperative. These success factors have been identied by worker cooperative development practitioners. 1. Clearly Dened Purpose and Focus

When a co-ops purpose is clear and understood by everyone involved, it is much easier to plan and achieve stated goals. Worker members must also believe in the clearly dened purpose and focus. 2. A Commitment to Worker-Ownership

Right from the start, an understanding and acceptance of the principles of workerownership is key. These principles include a) worker must be involved in decisionmaking; b) workers should be treated like owners and not worker; c) repeated and careful efforts must be made to make sure workers know what their ownership means. 3. Viable Business Idea and Thorough Business Plan

Business idea should be carefully considered, researched and analyzed. The business plan is the road map for co-op. It provides details of where co-op is going and how it!s going to get there. It should be accurate and comprehensive. 4. Suitable Ownership and Equity Structures

This means two things: systems that allow for workers to actively participate in decision making and receive a meaningful share of the prots. These two things could provide powerful incentives to succeed. 5. Access to adequate nancing

Co-op members will be an important source of initial nancing in the form of membership equity. Rarely is membership equity enough to nance the start and continued operations of the co-op. Other forms of nancing such as loans or possibly preferred equity may be needed. The structure and amounts of nancing should be determined during the business planning process. 6. Clearly Dened Roles and Procedures for Decision Making

This means different things if a co-op operates as a collective and doesn!t have managers versus a co-op that uses a management structure. In a collective setting clear procedures for decision making are extremely important. Clearly dening what decisions can be made by individual worker, which can be made by specied work

groups, and what kind of decisions should be addressed at meetings that include all worker-members. 7. Sound Business Practices

Use proven methods. Sound business practices include attention to nances, product quality, recognition of the importance of customers and responsive to their concerns. Develop quality-control standards to maintain consistency for products and services. Use established systems of record keeping, accounting procedures, and nancial controls to prevent nancial problems down the road. 8. Ongoing Education and Training for worker-members, Directors, and Management

Education and training are critical to the long-term stability and strength of a worker coop and to its success as a business. Having an education/training plan as part of business plan could be helpful. Education/training can cover issues related to leadership development, cooperative decision-making, interpretation of nancial statements and even second languages. 9. Entrepreneurial Skills and Knowledge

Worker cooperatives are an example of labor entrepreneurship. A group of workers starting a business and willing to assume responsibilities and accountability - together. Many entrepreneurial skills/knowledge can be acquired whether through work experience or education. Besides being willing to assume responsibilities and accountability, entrepreneurship includes the ability to sell product/service, ability to analyze potential success of new ideas, ability to adjust to challenges and opportunities, and courage to take a chance. 10. Business Advisors and Consultants Knowledgeable about Worker Cooperatives Advisors and consultants can save a co-op time and money by avoiding potential pitfalls. Worker co-ops often avoid advisors/consultants out of fear that such services would cost too much. Ask up front - is initial consultation free and ask for an estimate of costs? Check references and get referrals from other worker cooperatives and businesses.

Sources: " " " " "

Steps to Starting A Worker Co-op, Gary Hansen, E Kim Coontz, Audrey Malan (1997) Putting Democracy to Work, Frank T. Adams and Gary Hansen (1987)