Business associations are a very important element of civilized countries.
They have a strong, sometimes decisive influence on societies.
Business, more than other social estates, is interested in the absolute power of the Law and therefore contributes to its maintenance.
Thousands of business associations, unions, councils, federations, and chambers are in the USA. Practically all of them are ineffective. They are unable to consolidate the business community.
The cause of this is the wrong organizational structure of business associations.
A divided national business community cannot resist the clans of political demagocracy and defend itself against political pressure.
Entrepreneurs organize themselves into associations to coordinate and protect their interests by performing the following basic functions:
Establishment of prohibitions for community participants – not to cheat, not to obstruct competition, not to spoil nature, etc.
Elimination of the consequences of violations of these prohibitions – functioning of arbitrations, compensation for damages, execution of punishments, etc.
Pooling the resources of participants in their common interests – drafting and lobbying bills, forming public opinion, advertising collective brands, judicial protection from government agencies, charity, etc.
Existing business associations have the following flaws.
Association meetings are held once every 1-5 years. At them, participants transfer the right to make decisions to association managers. Therefore, the influence of the majority of participants on decision-making is close to zero.
In large associations, the rules for delegating meeting participants are not specified in the charters. Therefore, association managers influence the election of meeting delegates.
Wealthy members do not want to give large contributions if poor members give small contributions, but everyone has equal power.
Managers use the resources and influence of associations for their personal interests.
The public authorities force association managers to make decisions in the interests of these authorities.
Managers hire incompetent experts who prepare barren projects based on social-democratic rhetoric.
Seeing the inefficiency of associations, businessmen do not give them large contributions and refuse to participate in their activities.
The main cause of the viciousness of existing business associations is the incompetence of the specialists who design flawed organizational structures of these associations.
The main cause of the incompetence of these specialists is their ignorance of the principles of epistemology, in the first place, the principle of the discreteness of knowledge.
The organizational structure of a modern, effective business association is described in the articles “Technology of Political Consolidation of Business Elites” and “Principles of Effective Business Associations”.
The technical basis of such an Association is a web portal with voting functionality.
Each Association member has a digital signature certificate and an electronic key in his computer, by which he certifies his decisions and messages.
The weight of each participant’s vote is equal to his contribution to the Association.
The voting results are calculated automatically by the portal.
This technology gives the Association members the opportunity to self-govern constantly and continuously over the Internet and control the execution of their decisions.
The members collectively manage the Association’s resources and control their use.
Direct self-management of the Association eliminates the need for managers making higher-level decisions.
The absence of such managers minimizes the Association's vulnerability to pressure from government agencies and competitors.
The Association members’ desire to increase their influence, which is proportional to their contributions, increases those contributions.
The projects of the Association must comply with the principles of epistemology, which is a necessary condition for their scientific validity and productivity.
The discrete format of project documents and discussions prevents barren rhetoric and minimizes their size.
These properties ensure the effectiveness of the Association’s work, first of all, the coordination and protection of its members’ interests.
An effective Association attracts a large number of participants who consider its mechanisms fair and useful, want to increase their influence on its decisions, and therefore make large contributions to the Association.
A rich and powerful Association is able to promote the common interests of its members, defend them in the press and courts, form public opinion, lobby bills, and advertise collective brands.
Thus, the optimal organizational and technological structure of business associations is the key factor of an efficient economy and a stable society.
E. Gershman
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