Undoubtedly co-determination is the most important thing but there are some disadvantages of co-determination which are described below:
Disadvantages of co-determination
Co-determination is not without criticism. It suffers from certain drawbacks as under:
- The system is not democratic as it should have been. The workers do not enjoy direct participation in decision making. They have an only indirect stake in management through labor membership in Works Council and Supervisory Board.
- It is not uncommon that the election of worker representatives on the board is influenced by employers so that their “yes-men” are being elected to serve their purpose.
- Too much emphasis on technical skills makes Co-determination weak in human relations and conceptual skills. Moreover, the German managers are not quite competent to make plans and/or take decisions appropriate to situations.
- German industries lack diversification and the products are stereotyped by nature. Co-determination could help a little to add variety to German consumer goods and to help German goods retain supremacy in the world market.
- The principle of delegation of authority is hardly effectively followed under co-determination. Moreover, the decision-making process is slow. Co-determination also lacks modern techniques of management such as risk analysis, decision theory, linear programming, simulation, and the like.
Despite these limitations, the success story of co-determination attracts research interests from both developing and developing societies. Americans are amazed by the rate of German industrial progress after World War-II.
It was in fact, unbelievable that the German economy, which was completely shattered and destroyed, would regain its lost position within a couple of decades only. Co-determination makes it possible by showing a clear vision to the Germans that the defeat in the war front could only be remedied by a victory in the economic front.
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