Loss of democracy in a cooperative kibbutz industry: ethical dilemmas – an Israeli case study

Purpose: This study aims to examine the changes in cooperative community and kibbutz industry that did not undergo privatization. Design/methodology/approach: This research was based on the case study method, combined with ethnographic interviews and document analysis. Findings: The findings showed that the industry was highly successful economically, enabling the management to strengthen its authority without sharing information. The decision-making process, thus, became authoritarian, while the community's democratic mechanism was only nominal. This change was also accomplished by cultural transition from cooperative toward more capitalistic values. Management preferred to hire professional workers from the outside without any preference for kibbutz members, causing ethical dilemmas for certain elderly kibbutz members, who felt that the factory had abandoned socialistic ideas. Research limitations/implications: This research was conducted only on one kibbutz industry; further research is recommended. Practical implications: Management at cooperative organizations needs to realize that in a capitalistic environment, adaptation can cause the organization to lose its cooperative features. To prevent a cultural shift toward capitalistic values, managers need to be socialized and workers persuaded of the importance of cooperative values. Originality/value: The study is innovative for its focus on loss of cooperative community and managerial style that has not been addressed sufficiently in the literature. This research sheds light on organizational conditions that can cause cooperative communities to lose their democratic and socialistic attributes.