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The Mondragon Experiment - (1980)

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Description

The
Mondragon Experiment

Produced 17th November 1980 by the BBC and is a part of the Horizon Science series.

From Wikipedia

The MONDRAGON Corporation is a corporation and federation of worker cooperatives based in the Basque region of Spain. Founded in the town of Mondragón in 1956, its origin is linked to the activity of a modest technical college and a small workshop producing paraffin heaters. Currently it is the seventh largest Spanish company in terms of asset turnover and the leading business group in the Basque Country. At the end of 2010 it was providing employment for 83,859 people working in 256 companies in four areas of activity: Finance, Industry, Retail and Knowledge. The MONDRAGON Co-operatives operate in accordance with a business model based on People and the Sovereignty of Labour, which has made it possible to develop highly participative companies rooted in solidarity, with a strong social dimension but without neglecting business excellence. The Co-operatives are owned by their worker-members and power is based on the principle of one person, one vote.

The determining factor in the creation of the Co-operatives that today make up the MONDRAGON Corporation, was the arrival in 1941 of a young Catholic priest José María Arizmendiarrieta in Mondragón, a town with a population of 7,000 that was suffering the painful consequences of the aftermath of the Spanish Civil War: poverty, hunger, exile and tension. He decided to do all he could to promote coexistence and come up with formulas to create employment based on solidarity. In 1943 he set up a Technical College that was open to anyone, and which would become, with the passing of time, a seedbed for managers, engineers and skilled labour for local companies and, above all, for the co-operatives.

Before setting up the first co-operative, Arizmendiarrieta spent a number of years educating young people about a form of humanism based on solidarity and participation, in harmony with Catholic Social Teaching, and the importance of acquiring the necessary technical knowledge. In 1955, he selected five of these young people who were working at the Unión Cerrajera company (Usatorre, Larrañaga, Gorroñogoitia, Ormaechea and Ortubay) to set up Talleres Ulgor (an acrostic from their surnames), known today as Fagor Electrodomésticos, the pioneering company of the Experience and industrial embryo of the Corporation.

The first fifteen years were characterised by an enormous dynamism. It was a time when, taking advantage of the autarky of the market and the awakening of the Spanish economy, many co-operatives were set up. During those years, also with the encouragement of Don José María, two bodies were set up that were to play a key role in the development of MONDRAGON -Caja Laboral (1959) and the Social Welfare Body Lagun Aro (1966)- and the first local group was created, Ularco, the embryo of the industrial co-operative associativism which has been so important in the Corporation’s history. In 1969 Eroski was set up, as a result of the merger of ten small local consumer co-operatives.

Over the period from 1970 to 1990 the dynamism of previous years continued, with a strong increase in turnover, the launch of new Co-operatives promoted by Caja Laboral’s Business Division, the promotion of co-operative associativism with the forming of local groups, and the setting up of the Ikerlan Research Centre in 1974.

With big changes on the horizon like Spain joining the European Economic Community, scheduled for 1986, it was decided to take an important step in the organisational area, by setting up the Mondragon Co-operative Group in 1984, the forerunner to the current Corporation. In-service training for managers was also strengthened with the creation of Otalora, which was to dedicate itself to training and co-operative dissemination. The Group had 23,130 workers at the end of 1990.

On the international stage, the aim was to respond to the growing globalisation process, strongly promoting expansion abroad by setting up production plants in a number of countries. The first, the Copreci plant in Mexico in 1990 was followed by many others taking the total to 73 by the end of 2008. This was part of a strategy aimed at: increasing competitiveness and market share, bringing component supply closer to important customers’ plants, especially in the automotive and domestic appliance sectors; and strengthening employment in the Basque Country, by promoting the export of products manufactured by the Co-operatives by means of the new platforms.

In October 2009, the United Steelworkers announced an agreement with Mondragon to create worker cooperatives in the United States.

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