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Company Management: Autocracy vs. Democracy

For many business owners and executives, few skills or disciplines have more impact on their business and day-to-day world than management.


Today’s success and tomorrow’s expansion rest on how well the company and its employees are managed, both from the top by the boss/owner and by lower-level managers whose job it is to help ensure a smoothly running and expanding company.


Consequently, libraries are replete with books that address this topic. And while each expert hails his or her own system and philosophy, all find themselves somewhere on a spectrum that moves from autocracy (“my way or the highway”) to democracy (“Let’s put it to a vote, folks”).

Autocracy vs. Democracy

How does the iron-fisted, no-discussions approach compare to discussing things and putting them to a vote? What are the respective pros and cons?


Says Dusty Barrick, president of Diversified Interiors of Amarillo, Ltd. in Texas, “Autocracy stifles innovation and contrasting viewpoints. Should the manager’s ideas be dated or flawed, the entire organization suffers. In a democratic environment, employees are empowered and feel that their voice is important. Multiple viewpoints provide more diverse options.”


Suggests Jes Pederson, CEO at Webcor Builders in California, “It depends on the business or the event a business is involved in. In an emergency room, you want pure autocracy—someone giving explicit instructions and others carrying them out without hesitation since time is critical to patients’ survival. And the same goes for construction when involved in a crisis: You need the most senior managers giving unequivocal directions to handle the situation.


“When it comes to day-to-day construction, where you land on the spectrum depends on the kind of culture you want to foster. An autocracy infers that others have little to offer and that the boss knows best, while a pure democracy moves too slowly to be effective.”


Adds John Kirk, owner of Kirk Builders in California, “Before going into business for myself, I worked for 10 years at an autocratic company, and while this isn’t the way I run my own business, I still respect the philosophy as it was a very successful business. Also, pure democracy can lead to paralysis by analysis, and the people whose ideas were voted down can be left with hard feelings. However, a good manager can solve these potential problems.”


Offers Steve Winn, corporate credit manager at Marek Brothers in Texas, “An autocratic manager misses out on the benefits of a team. If your people are not allowed to exercise their gifts and skills, you don’t develop them for the future. In fact, your way dies with you.”


Todd Lawrie, president of Delta Contracting Service, Inc. in Michigan suggests, “Autocracy works to some extent with employees whose skill sets are questionable or who are not up to making decisions. Of course, the skilled lads will take offense at this and may indeed take to the highway—your loss. That said, my company is not a democracy. If an employee’s ideas are contrary to what I feel needs to be done and they cannot assure me that their way will indeed meet the required end, then it’s my way. While the guy in the trenches usually has a better idea of methods required for an individual application, they often do not have all the information needed to make the best decision.”


Observes Pat Arrington, principal at Commercial Enterprises, Inc. in New Mexico, “Established company policies, safety and project requirements, respect for clients and inspectors, code requirements, good practices and the standards of our trades are never up for discussion. These key aspects of a company cannot be compromised if you want to stay in business.”


Chuck Taylor, director of operations at Englewood Construction, an Illinois general contractor, agrees. He says, “There must be policies and procedures in place for many aspects of our business—our sacred cows if you will. Production is lost if everything is run by committee. That said, as leaders we need to be open to new ideas and promote collaboration between departments and staff at all levels.”


Adds Robert Aird, president of Robert A. Aird, Inc. in Maryland, “Clear, direct, autocratic instruction works well most of the time. But autocracy suggests employee inability to handle a given situation and does not encourage thinking a need through, nor does it make employees deal with wrong decisions, which can be very educational long-term. In any company, the principle of ‘give a man a fish and he eats today, teach him to fish and he eats for a lifetime’ applies. To grow an organization and to maximize personnel resources, you must have faith in your employees; you must train and encourage them.”


Quips Charles Antone, consultant with Building Enclosure Science in Rhode Island, “It depends on the situation. In order to get a bunch of 18- to 23-year-olds, scared out of their minds, to run up a hill and shoot at people they’ve never met, you have to be very autocratic and scream at them like crazy. But if that is your management style, you will attract and retain people who need that type of leadership. You’ll staff your business with robots. As for democracy, most of the time 10 heads are better than one. But it takes too long in emergencies.”


Lee Zaretzky, president of Ronsco, Inc. in New York City, believes that “autocracy is counterproductive. Unless you have buy-in, people will not be productive. And the way you bring about buy-in is to give someone a really good idea while making them believe they came up with it. That said, there are proven methods and procedures for doing things. There’s no need to make changes for the sake of making changes.”


Norb Slowikowski, president of Slowikowski & Associates, Inc., an Illinois consultant who writes this magazine’s monthly “Supervision” column, says, “Forget putting things to a vote; just use situational leadership. Workers need different leadership at different times. This isn’t a democracy, someone needs to be in charge. Yes, if you have the time, by all means solicit feedback to assess the issue at hand, then make the decision. And you can certainly put minor things to a vote, but not those that affect productivity on the job.”


Observes Robert Sutton, senior PM/estimator at Reitter Stucco and Supply in Ohio, “Autocracy teaches up-and-coming managers a uniform approach, a process that creates consistency within the organization. This translates into reliability. The downside to autocracy (also known as “micromanagement”) is that it may stifle creativity by never providing opportunities for individuals to demonstrate their abilities. Bottom line: You can’t run a dictatorship, nor can everyone do whatever they like. It really isn’t a pro-versus-con situation but knowing when to apply ‘my way’ and when to back off.”


Adds Mike Heering, president of F.L. Crane & Sons, Inc. in Mississippi, “Some who consider themselves great leaders cannot pull themselves out of the weeds long enough to let their people move forward. An autocratic approach does define the boss’s role and where the employee stands, which can be a good thing, but you have to determine how much ‘my way’ to use according to the situation.”


Observes Scott Bleich, president of Heartland Finishes, Inc. in Iowa, “I don’t see a lot of pros with autocracy. Yes, there are emergencies where you have to take charge and lead, but we’re a very collaborative company. The key is to surround yourself with smart people. If you’re too autocratic, the smart ones, feeling stifled, will leave you. Still, you cannot vote on everything; you need to find the right balance.”


Adds Craig Daley, president of Daley’s Drywall & Taping in California, “In a successful company, employees carry out their duties according to established processes, the ways we’ve found to be the most efficient. Of course, it’s crucial to explain why we develop and enforce processes, otherwise you won’t have buy-in, and this will restrict the employee ingenuity and innovation that might improve your processes and procedures.”


Summarizes James Keller, vice president at Valcom Enterprises, Inc. in Kentucky, “For better or for worse, autocracy lets employees know who the boss is, and it leaves no question as to the chain of command. However, if too heavy-handed, this demands respect rather than earns it. Employees like to follow someone who has been in the trenches with them and who will never ask of others what he cannot do himself.”


The perceptive manager realizes how much “my way” to enforce based on the situation at hand, but also knows that collaboration and buy-in foster trust and a willingness to shoulder the wheel, and therefore should be deployed whenever possible.

Open Door

Many manuals on management and leadership promote the open-door approach, inviting employees to share views and concerns with all levels of management. So, do wall and ceiling management keep their doors open?


Says Barrick, “I try to be attentive to my employees. I welcome their opinions and consult them about decisions, but I am also not afraid to tell them the way we are going to do things.”


Pederson concurs: “As open as possible. Also, as you get farther up the food chain, you want more input from all levels.”


Kirk’s policy is that his door is “about 75 percent open, more to my long-term guys.”


Winn’s door is also wide open, as is Lawrie’s. “The door is always open,” says, Lawrie, “but I have a saying (actually, I am full of sayings): ‘Never ask me a question for which you might not like the answer.’”


Adds Arrington, “It should be open to any employee. If they have work-conditions or safety concerns, we will listen. On the other hand, if it’s about the management of a project, they have the right to leave—they cannot set policy.”


Shares Taylor: “My door is always open, and I am always approachable. When I need it closed, the staff knows to wait until it is open again. I believe that when we are available to the team, we increase our value. A former boss once told me that he knew I was ready for the next step when people began coming to me for answers. This is one of the most important lessons I’ve learned in my career.”


Observes Aird: “Sometimes I think it should be more closed. But the truth is that all my employees—both office and field—have access to me for whatever they need. My sense is that access and a sympathetic ear foster employee loyalty.”


Antone’s door is completely open, as is Zaretzky’s. “Always open,” Zaretzky says. “But leaders also need to see things for themselves and not wait for people to come to them. And you need to ensure people do not come to you with every little thing. They need to feel empowered and entrusted to make both decisions and mistakes.”


Slowikowski agrees, “My approach: Go to their turf. Whoever is in charge should visit job sites several times a week and spend time observing people at work in their environment. This gives you insight as to their needs.”


Adds Sutton: “My door and those of all of our managers are always open to anyone. I never turn our employees away regardless of how busy I might be. If I don’t have the time when they want to discuss something, assuming it’s not urgent, I usually make time for them later in the day. You should always be accessible since your employees are the company’s most valuable asset.”


Heering agrees: “My door is open all the time for whomever needs to talk to me about an idea or a problem. This is true of both management and field staff. This policy has fostered many great ideas, and had I not made them feel welcome, we could have lost out on some very good solutions.”


Adds Bleich, “My door is always open. In fact, we are in the middle of a remodel so we have no doors at all right now. And I like to collaborate; I will go to our people and sit next to them.”


Shares Daley, “If you come into my office, feel free to close the door behind you so I can give you my undivided attention. Unless I’m in one-on-one meetings or on an important phone call, you’ll find my door open. That said, over the years, you learn how to end meetings once the substance has been discussed and to keep the personal to a minimum.”


Quips Keller, “It’s always open, but of course I shut it if I need to yell at someone.”


The consensus here is very clear: The more open, the better.

Delegating Authority

As your company grows, you simply have to delegate authority. There just are not enough hours in the day to micromanage everything.


But what qualities do you look for in an employee who you hope will shoulder more responsibility?


Says Barrick, “I look for willingness to learn and lead. And I look for attitude, work ethic and intelligence.”


Adds Kirk, “In my book, first and foremost, they have to be good tradesmen. Also, they must be able to work with others—the crew, the site foremen and other trades.”


Winn looks for “people skills, communication skills, integrity, wisdom, humility and passion. With these qualities, you can lead any group.”


Observes Lawrie, “It is a matter of how much power/authority someone can handle. I look for someone who is self-motivated, who grabs the reins and runs with it, who is knowledgeable yet open to learning new methods.”


Arrington’s criteria include “dedication to the company and the willingness to do any job. Add people and communication skills as well as responsibility and the ability to own up to mistakes.”


Adds Aird, “Someone who has demonstrated long-term reliability and who manages his or her day-to-day work well while working smoothly with others.”


Observes Zaretzky, “I look for communication skills—probably the single most important aspect to any successful and sustainable business. Also, authority is earned by proven ability.”


Shares Slowikowski, “I look for these qualities:

  • Knows how to solve problems, make decisions and remove obstacles.
  • Has a positive attitude and initiative.
  • Is willing to learn.
  • Is effective at planning, directing, organizing, and controlling.
  • Is persuasive when presenting ideas.
  • Can deal effectively and manage different personality types.
  • Is an effective listener.
  • Can interact with people without hesitation.”

Sutton reflects, “A good manager knows that not all people advance at the same pace, and he is aware of his team members’ limitations. I look for good performers who think critically and who put the organization’s needs ahead of their own, who are somewhat modest and don’t need to shine above the rest; however, these individuals should want added responsibilities.”


Adds Heering, “Apart from communication and people skills, I look for good work ethic, for the ability to lead by example, and for an ability to delegate tasks.”


Says Bleich, “In my book, the right mix is 5 percent education, 10 percent aptitude and 85 percent communication skills.”


Shares Daley, “When an employee can make decisions that adhere to company values, I let them make those decisions. Still, the number-one quality in a future manager is earned respect. The saying that ‘You can’t be a leader unless someone follows you’ holds very true.”


Says Keller, “I delegate as much as they can handle, trusting them to tell me when they are pushed to the limit. And I look for someone who admits mistakes when they happen—and they will happen. And I look for someone who can and is willing to share what they know and how they do things in such a way that others can quickly figure out how things are done, be it estimating, project management or just ordering materials. A good teacher, in other words.”


If the employee you’re considering for managerial responsibilities has earned the respect of his work mates, and if he is a good communicator, you can’t fail.

Managerial Training

Once you’ve settled on your future managers and leaders, how do you best nurture and train them?


Says Barrick, “Oversight, information, review. I give them tasks to do and then monitor their progress and review the results.”


Adds Arrington, “Allow them to make mistakes and teach them how to recover so as to maintain respect from all involved.”


Shares Taylor: “Assign tasks with deadlines. Offer advice and be available for questions. Ask for updates. Hold them accountable and offer praise and constructive criticism. Most importantly, let them know they are not alone and that there is nothing they will come across that we have not already seen and resolved.”


Zaretzky adds, “Those you hire must not only have leadership abilities but should also fit in culturally. You can always teach specific processes and systems, but true collaboration only happens among a team with similar values.”


Shares Sutton, “I give them guidelines within which to operate and then coach/mentor them while they grow at their own pace.”


Daley observes, “The mentor system is best: Let a potential future manager work closely with a good existing one. We also rely on FMI Corporation courses to further train our stars.”


Adds Keller, “It takes time and patience. Share the what, how and why when you make decisions. They learn by observing and understanding your decisions and actions.”


Given the willingness to lead, a mix of formal training and mentoring will give you a good manager.


Offers Bleich, “We must lead in a way that lets our people be heard, and we must prove to them that we always have their backs. It’s all about mutual trust.”


Adds Zaretzky, “Management is an art, not a science. You need to remain adaptable and flexible. Also, teach them to manage expectations: under-promise and over-deliver. People want to help, they want to be part of a solution, they want to feel useful. Cultivate this basic decency.”

California-based Ulf Wolf is the senior writer at Words & Images.

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