Leading to Empower: Workplace Democracy Improves Retention and Boosts Morale

By Bob Hampe

There has been a rising frequency of content on the airwaves lately regarding employee turnover and new sourcing techniques.  As the economy recovers from the ongoing pandemic, we’re seeing more and more companies struggle to find good employees and staff. Why? Well, there are a lot of reasons—too many, in fact, for this article. But the fact is, COVID-19 reorganized priorities for some folks, and some white-collar workers understandably don’t want to give up the flexibility and balance many of them enjoyed in the exclusively work-from-home days of the pandemic. Others seek a workplace that is more in line with their values and goals. 

Actall has had to find creative ways to attract and retain talent for some time. We are in a hyper-competitive environment in Denver fueled by a number of venture-capital-backed firms competing for the same resources as we are. We had to adjust our culture and management styles to become competitive with the market long before the pandemic started. Fortunately, we had some timely input and mentors along the way that shaped our current culture for the better.

One thing rings true (pandemic or not): Most people don’t leave jobs—they leave bad managers. They leave a crappy culture. Bad management and bad work environments are often cited as the top reasons people leave their positions. There are no magic benefits, office snacks or flexible Fridays that can make up for bad management or a toxic work environment. 

Actall is proud to abide by the principles of “workplace democracy.” Put simply, we lead in a democratic style—with participatory decision-making, input from employees and a commitment to transparency. I can’t credit our approach as the sole reason most of our team members stay with us for years on end, but I do know that it enriches the environment and helps people feel engaged and enthusiastic. Here’s how we built a workplace democracy, and how managers and leaders can implement these tactics.

Leadership Styles: An Overview

As most people know, different leadership styles have different impacts on productivity and morale. I think of the movie “Horrible Bosses” when I imagine a worst-case scenario for bad management—but poor, unsupportive management is rampant in our hierarchy-fueled workplaces. 

Some leadership styles, such as the authoritarian style, may encourage consistent, fast results—but often at the expense of team morale. In a crisis, the technique can band a team together and remove distractions. But when used long term, it can have a negative impact (to say the least) on creativity, team cohesion and employee retention. 

A laissez-faire leadership style, in which leaders do not set boundaries for work hours, dress code or productivity, can significantly empower employees. Leaders can focus on business operations while employees, well, do their thing. Though effective in certain situations, this leadership style can sometimes result in less-experienced team members missing out on growth and development opportunities. And without clear expectations for productivity or performance, team members may be frustrated or uninspired. 

Somewhere between those two styles is a more democratic approach.  This concept places value on team input and buy-in before major decisions or initiatives. It offers lower-level employees the opportunity to participate in decisions, which is not only empowering, but it also serves as excellent training for future management roles. 

Team members feel that their contributions are important—even necessary—to the optimal functioning of the workplace, which leads to feelings of control and engagement. For a decent portion of my professional past, I myself had a reputation of being more of an autocratic micro-manager. But after exploring other models of leadership, and some trial and error, I found that my team was best motivated by these democratic principles of empowerment, trust and freedom.
Basic psychology tells us that when people feel engaged, they are happier. But being engaged at work can help employees find meaning and purpose, perform at optimal levels and reduce the chances of churn.

Actall’s Approach to the Democratic Workplace

A few ways that we work to create a democratic workplace include an open work schedule, self-determined paid time off, open-book financial management and open company performance assessments. 

These tactics demonstrate our trust in our team members and help them to prioritize a work-life balance. An open work schedule also empowers team members to work in ways that best suit their skill sets and personalities. 

These techniques aren’t groundbreaking—but they make a huge difference in morale, retention and employee satisfaction. And a democratic approach means that team members are empowered to learn, ask questions, develop their skills and engage in a more profound way.

Here’s How Leaders Can Implement Democratic Approaches

Interested in the approach? You don’t have to change your entire business structure or management style overnight. But there are some simple tweaks to management styles you can make in the immediate term. For starters, the next time a business concern arises, ask for employee input. This can be as simple as running an idea past your team at the next all-hands meeting or creating a simple survey asking for feedback on a company policy. 

If there’s an opportunity to discuss the why behind a recent decision—to celebrate a major acquisition, for example, or to request a brainstorm from your team—I encourage you to go for it. Start small, and see how your team responds to it.

For longer term, more permanent culture changes to a democratic approach, I recommend expanding your mentor network to include firms and persons who have already made the leap.  There are a host of resources that show up with a simple search. BCorp or WorldBlu have been great resources for Actall.

The goal is to empower, engage and involve. With some effort and creativity, you’ll see results—and I’m willing to bet that you’ll attract and retain talent at a higher rate.