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Anyone have any examples of an employee union that improves business for both employees and employer?
The most salient feature of unions that I know about is that they prevent the employer from firing bad employees, or promoting good employees over ones with seniority. This makes sense to me because unions get their power/support from employees that need the union more than the employer needs them i.e. bad ones. A prototypical example of the leftist high-low alliance.
But there's no reason it has to be this way. It's technically possible for a union to say "fire bad employees, promote some faster than others, but pay us more". Is there any examples of this sort of thing working well?
First of all, unions don't prevent employers from firing bad employees or making promotion decisions based on seniority; rather, contracts do that, and only some contracts do so. Moreover, the general rule is the US is that workers can be fired at any time without cause -- i.e., at the whim of the employer. Union contracts, in contrast, permit firing only for cause. What constitutes "cause" varies, but still, here is one benefit: Those contracts not only make it more difficult to fire bad employees; they also makes it more difficult to fire a good employee who happens to get on the wrong side of a bad supervisor, or who doesn't "get with the program," even when the program is a poor one.
Let me explain in more detail.
First, it is well established that managers of companies do not always act in the best interests of the companies themselves. For that reason, giving employees the power to push back against managers can often be in the best interests of the company. See, eg, Dilbert.
Second, let's analogize with tenure in K-12 schools (which, contrary to popular belief, means only that teachers can be fired only with cause, as opposed to, as CA courts put it re teachers before they get tenure, being fired "for any reason, or for no reason.") When I taught high school, I had tenure, and hence I (and other teachers) were able to push back on all sorts of proposals by administrators which were unlikely to inure to the benefit of students (newsflash: teachers know more about their students than administrators do). Sometimes that was about budgeting -- federal law requires decisions about spending money to be made by a committee composed of administrators, teachers, and parents. Teacher representation would be pointless if teachers on the committee have to fear getting on the wrong side of the principal). Sometimes it was about the administration pushing teachers to teach how to game multiple choice tests rather than teaching real curriculum. The list goes on and on.
Now, this is not to say that teachers always act in the best interests of their students, nor that administrators never do. Ditto re the analogous positions in private companies. Nevertheless, a system in which those in supervisory roles have unfettered power is unlikely to yield anything close to optimal results.
Disagree, for counterexamples see every military and small business ever
Well, re small businesses, where is your evidence that small businesses are particularly effective? Anyhow, truly small businesses don't have principal-agent problem that I mentioned, so they are irrelevant to my argument.
As for every military, again, where is your evidence that militaries are particularly effective at what they do? Or that militaries which give have those types of power structures are more successful than those which don't? Because all the evidence I have ever seen implies the opposite. See eg this US Army manual on leadership, which repeatedly emphasizes that effective leaders need to exercise humility and to encourage candid input from subordinates.
Hierarchical organization does not exclude using feedback from subordinates or delegating decisions.
The most efficient organizations are small businesses on their way to becoming large businesses. Founders of unicorns always talk wistfully about how awesome the company was before it got too big. The least efficient organizations are the ones that have that reputation, e.g. the Toronto Transit Commission.
The common feature of organizations that suck is that they dilute accountability, both for success and failure. Within a hierarchical organization, this is not the case. Here's another example: sports teams. The best players have the most authority, and the coach has ultimate authority. It works, because if something else worked better, everyone would do that instead.
Are they? Correct or not, "small businesses growing into large businesses" is a subset of small businesses, and a fairly small one at that.
Again, is this true? A lot of small businesses (where all the responsibility is on the owner-manager) suck quite badly despite concentrating accountability. Moreover, hierarchical organizations are great at diluting responsibility. This is true in both the public and private sector, though it is especially apparent the public sector. You can have a massive fuckup where everyone involved can - sincerely - say "I was just following instructions/official guidelines".
Subset of small businesses, that includes all large businesses.
The ones that suck do because their principal sucks. This does not say anything about the quality of the organizational structure.
I disagree. The public sector is the counterexample of hierarchy. If a superior can't fire his subordinates, it is not a hierarchical organization.
A large business is by definition not a small business.
What does this mean?
You're going to lay out what you mean by 'hierarchical' then, because it clearly has some disjunction from the common usage. In particular, the above would exclude militaries, which you previously praised.
Disobeying orders in the military is called insubordination. The penalty ranges from death (historically, maybe still in some places) to a court-martial. This is functionally the same as firing.
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