There are several hazards that threaten all forms of organization. These are threats that need to be kept in mind when designing and running organizations, and include when:
- Their true purpose becomes lost due to the conflicting motives of the people involved in running its day-to-day operations. The energy going into achieving the organization’s aims does not match the energy directed into the pursuit of personal concerns, such as office politics, ego trips by decision-makers, and a variety of other diversions.
- They prioritize the interests of those who run them on a day-to-day basis above delivering benefits to their rightful owners. It’s not unusual to find that the driving force in organizations becomes the enhancement of the lifestyle of their senior managers, defending their jobs and privileges.
- They emphasize short-term benefits and do not give enough time and resources to building the organization so that it’s prepared to meet the future.
- Those running the organization resist essential change because they have no real incentive to support change.
- They cease to be ‘learning’ organizations when to prosper they need to be constantly responding to the environment in which they operate. When organizations stop learning - they start dying.
- Cultural collapse occurs - Organizations can rapidly move from a position of delivering on their purpose to one where they are struggling to survive, this happens when leaders do not live-out the required culture.
- Conflicts of interest occur - The owners of many organizations are often blind to the conflicts of interest that exist in their organization.
- Egos and obsessions prevail – The most profound threats to organizations arise when those controlling them are ruled by their egos and their obsessions and when they become addicted to power.
Specific threats to self-help enterprises
SHEs are open to many of the same hazards that can endanger all forms of organization but, in addition, they face some very particular risks. Members, and above all their leaders, ought to fully appreciate the specific hazards facing this form of enterprise and learn how these risks can be managed. Among such threats are those arising from the fact that SHEs need to be democratically controlled. Where members are not engaged with their enterprise and are neither properly informed nor empowered, their enterprise is wide-open to both internal and external hijack, often resulting in a de facto change in the ownership.
There are always predators, both within and without an organization, who will seize any opportunity to take control away from the membership. Humans can be very adept at concealing their weaknesses, including their addictions, so systematically checking on how people are behaving within our organizations is vital. Without adequate legislation and effective oversight, most organizations will predictably default to a position where they prioritise the interests of those running them day-to-day. In other cases, SHEs transform to being run in the interest of those who provide their finance. In either case, whenever this kind of change happens, the outcome is that the interests of their true owners are side-lined. Those who have in effect ‘stolen’ the enterprise from its rightful owners inevitably also resort to exploiting of their disenfranchised members. This kind of scenario can happen in all manner of organization, including investor-owned companies, cause-driven enterprises, as well as in SHEs.
It's important to understand that many enterprises bearing names that imply that they are genuine SHEs are not authentic. In some countries, businesses can get away with calling themselves names that imply they are SHEs (for example – ‘cooperatives' or ‘building societies') when they are not by any stretch of the imagination bona-fide self-help enterprises. Enterprises that started as genuine self-help enterprises have mutated into a form of enterprise that primarily serves the interests of those that control them on a day-to-day basis. Members of mutant enterprises need to re-establish member-control over their enterprises. The first step in this process is for members to gain a clear understanding of the self-help enterprise model. In some counties, changes in the law are required to ensure that self-help enterprises remain authentically member-controlled and are operating for the benefit of their members.