Mondragon Cooperative Corporation's Basic Principles. Four Main Essay

Length: 11 pages Sources: 8 Subject: Business Type: Essay Paper: #30189219 Related Topics: Self Reliance, Corporation, Travel Agency, Security Principles
Excerpt from Essay :

¶ … Mondragon Cooperative Corporation's Basic Principles. Four main factors stand out: 1) the Mondragon Cooperative Corporation's rapidly advancing concept of Work Environment, in accordance with Finance, 2) reasons people change and the nemesis which causes the ever-growing sense of improvement (perceived as advancement) in Retail, 3) Benefits of Autonomy and Self-Reliance in Industry, and 4) the self-determination from which all knowledge is based.

By all means, knowledge poses as the central theme by which these other elements find nourishment; without knowledge, a vital sense of comprehensive awareness, that on-top-of-it characteristic paramount to Mondragon would not exist as it stands.

Work Environment

The move from a mechanized and industrialized culture to a digital society has fundamentally modified what we consider these key-phrases: occupation, employment, profession, career, assignment, and vocation. What's nice, of course, is that advancement and promotional encouragement is much more easily attainable, and will continue to increase as the world's economy strengthens from quite a low that we all currently have. This loss of revenue the entire world has been recovering from, and really still facing, will be compensated soon enough.

Financially, the banking business of Caja Laboral, the insurance company Seguros Lagun Aro, and the Voluntary Social Welfare Body Lagun Aro, all had an asset fund totaling 4.2 billion euros by the end of 2009 (Eroski contigo, 2009). This was more than a year ago; hopefully even now they've still got it straightened all out and continue to prosper.

"The structural reorganization of the Mondragon cooperatives in 1987 and 1989 formalized the basic principles and delineated the legal regulations of the system. Through these meetings, the ten basic principles and the mission for Mondragon were defined."

Fast-forward twenty-plus years. The business setting has changed and is changing to an unprecedented degree.

Conventional cooperatives use accumulated capital for the private use of members. The MCC on the other hand uses accumulated capital for community benefit. The key distinguishing factor of the MCC is not co-operativism per se but the community base as recognized through social equity. Similarly, Gibson-Graham (2006) sees the MCC not as solely a classic cooperative project but as an ethical and political space of decision centered on community. That is, the cooperative form is the tool used to achieve a different end (Social enterprise and socio-legal structure: constructing alternative institutional spaces for economic development).

Regarding advancement, the future must always be regarded as better than the past; this is the significance of history: we then have a base from which to use as a guide. Salaries within any sector do not fluctuate too greatly, and there is always safety to be found in numbers (that is, numbers of other operational employees within any workforce). Therefore, the self-confidence and composure that comes from this assurance instills a sense of serenity and calmness that is inductive to production and progress. Several traditional work ethics and procedures have become entirely unidentifiable to young people entering the workforce of today. In fact, even folks resuming employment after some time off, even a few years, must learn an entirely new code of principles and behaviors.

The financial yield acquired through this structural reorganization of the Mondragon cooperatives will be used to incorporate long-term retirement, widowhood, and invalidity benefits, complementary to those offered by the Spanish social security system. "Caja Laboral, for its part, ended 2009 with 18.6 million euros of deposits in a year in which it granted loans worth 16.4 billion, mainly to household economies and small and medium-sized enterprises. Its extensive experience with the Corporation's Co-operatives enables it to offer SMEs services typical of large companies" (Tonder, 2003).

III. Retail: Reasons People Change

This rapidly advancing technological world seems too rapid and instant to keep track of what has become outdated and discontinued. Everything that was understood as recently developed or modern as recently as three to five years ago is now considered unfashionable, behind the times, old hat, antiquated, square, passe, or outdated. What's more, all the most recent technology that we know as of today will be outdated within three to five years from now. Contemporary, modern, and cutting-edge fits the lingo of the 21st century.

As stated by MacLeod (How to Start a Community Enterprise):

When a group has limited liability the assets of the private citizen are not at


If a society or association carries on a business and is sued, then individual members can be charged and their assets seized in a lawsuit. Under most legal systems, associations and societies are not designed for operating businesses. The legislation of most jurisdictions grants limited liability only to businesses incorporated under a Company's Act or a Cooperative's Act. The three typical forms of incorporation are: a joint stock company, a cooperative company and a not-for-profit company (sometimes called a company limited by guarantee).

Mondragon also hosts a retail leader within Spain; this unit posted "a turnover of 8.4 billion euros in 2009" (Finez, 2009). According to the Mondragon Cooperative Corporations website, "It operates all over Spain and in the south of France, and maintains close contacts with the French group Les Mousquetaires and the leading German retailer Edeka, with whom it set up the Alidis international partnership in 2002." Evidently, Spain is a hot-spot for the Mondragon Cooperative Corporations. Even further, these points are only furthered on other websites as well (Mondragon Corporacion Cooperativa, Mondragon Cooperative Corporation, Mondragon Corporation -- - sageheart, and even Mondragon Corporation - Wikipedia, the free encyclopedia as well as several others):

The worker-owners and consumer-members are involved in the management of Eroski, with both groups participating in the Co-operative's decision-making bodies. At the end of 2009, Eroski was operating an extensive chain of almost 2,400 stores made up of 113 EROSKI hypermarkets, 1,063 EROSKI/center, Caprabo and EROSKI/city supermarkets, 224 branches of the EROSKI/viajes travel agency, 58 petrol stations, 40 Forum Sport stores, 289 IF perfume stores, 7 Abac leisure and culture outlets and 40 goods depots. In addition to this chain, there are 481 self-service franchise outlets. Moreover, in the south of France it has 4 hypermarkets, 16 supermarkets and 17 petrol stations and 4 perfume stores in Andorra (Eroski Contigo, 2009).

Evidently this Mondragon Cooperative Corporation is elusive. Though the term elusive typically carries a negative connotation, here it stands for the indefinable quality of this corporative method of intervening.

At an Assembly held In 2008, its worker-members approved by a majority vote the process to expand the transformation into co-operatively run businesses to the Group as a whole. So work started on turning the Group's subsidiaries into co-operatives, as well as on making their salaried workers worker-members. This process will be carried out gradually over the next few years. The retail area is also home to the food group Erkop, which operates in the catering, cleaning, stock-breeding, and horticulture sectors and has as its leading name Auzo Lagun, a co-operative engaged in group catering and the cleaning of buildings and premises, and also offers an integrated service in the health sector (Eroski Contigo, 2009).

Moreover, Mondragon, under the leadership of Eroski, formed a collaboration with the United Steel Workers: "The United Steelworkers (USW) and MONDRAGON Internacional, S.A. today announced a framework agreement for collaboration in establishing MONDRAGON cooperatives in the manufacturing sector within the United States and Canada" (Sturr, 2009).

The USW and MONDRAGON will work to establish manufacturing cooperatives that adapt collective bargaining principles to the MONDRAGON worker ownership model of one worker, one vote" (Sturr, 2009).

"The USW is North America's largest industrial union representing 1.2 million active and retired members in a diverse range of industries" (Sturr, 2009).

IV. Benefits of Industrial Autonomy and Self-Reliance

As is currently quite opportune, the convenience of this technological age resides with the broad availability that this technology brings with it. The Mondragon Corporation announced a Total Turnover of 16.8 billion euros in 2008; 6.5 billion corresponded to Industry, while 9 billion to Retail and 1.2 billion to the Finance arena. Evidently, it is quite accommodating; in fact, far more accommodating than ever before in history. This is definitely a benefit.

In a major sense, this enhanced sense of self-reliance brings a newly formed sense of job security with it. Both metaphorically and literally, this broadening sense of situational and environmental advancement will bring with it far more career availabilities, and even options with it. Moreover, this will invite training and build work experience at an unprecedented rate.

Our perception of loyalty and commitment has shifted and is shifting. The prolific and energetic focus is now placed on the self, as opposed to solely appeasing the supervisor in charge at the moment. Employment issues will be more focused inward, therefore, and the person who made any error will the only one accountable. Thus, if the mistake is not fixed, then that individual will face the heat as opposed to sneaking around and desperately being able to search for someone else to blame. This sensational pace of change is being catapulted by…

Sources Used in Documents:

Sturr, Chris. Steelworkers Form Collaboration with MONDRAGON, the World's Largest Worker-Owned Cooperative (27 October 2009). Dollars and sense real world economics. Web. 8 April 2011.

Finez, Javier. "Virtual Teams and Creativity in the Mondragon Cooperative Corporation" (2007). Higher Creativity for Virtual Teams: Developing Platforms for Co-Creation. IGI Global. Web. 2011.

Kasmir, Sharryn. The Myth of Mondragon: Cooperatives, Politics, and Working-Class Life in a Basque Town (1996). State University of New York. New York Press.

Cite this Document:

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