Why democratic organizations turn oligarchic

"The iron law of oligarchy" - the reason why, over time, power in organizations accumulates in the hands of a few, and what to do to prevent this. Download a checklist to see whether it applies to your partnership. 

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Today's paper:

Diefenbach, T. (2019). Why Michels’‘iron law of oligarchy’is not an iron law–and how democratic organisations can stay ‘oligarchy-free’. Organization Studies40(4), 545-562. The full text is here.

What was the question?

Is it inevitable for democratic organizations to become oligarchic?

Why is this important?

More than 100 years ago, Robert Michels claimed that democracy is structurally impossible because of "the iron law of oligarchy."  In short:


Complex tasks → need for division of labor → specialization → professional leadership → leaders introduce hierarchical rules for others → leaders try to keep their power by all means.


So the claim was that every organization eventually gets to the point when power is accumulated in the hands of a few (in other words, becomes an oligarchy), you just need to wait long enough. The "iron law of oligarchy" became very influential and undisputed for almost a century.

How did the researchers try to answer this question?

Diefenbach shows that the "iron law" is not actually inevitable: he makes some theoretical reasoning and brings several examples of organizations that remain democratic for quite a long time. This is called falsification, the scientific principle of theory testing. Karl Popper first formulated this principle and used a famous example: to prove that not all swans are white, it is enough to observe only one black swan. 

What did they find out?

Not exactly "find out," but Diefenbach suggests several ways to resist the "iron law":

1. Demystification of leadership. Leadership is a set of skills that everyone can learn, not something people are born with. We must make efforts to simplify this knowledge and make it available to the members.
2. Separation of power. Modern democratic states separate legislative, executive, and judicial branches of power, and we can do the same within one partnership. Key tasks may be distributed among different people (think about planning and controlling, for example).
3. Avoid specialization whenever possible. One way to divide the labor in a sustainable way is to rotate managerial functions such as planning, organizing, leading, and controlling. 
4. Checks and balances. "Checks" are the rules that allow members to criticize or veto decisions, and "balances" are the interests of different people within the organization or network (think about representatives from each unit in the board).
5. Full participation. All members should have an opportunity to participate in the making of critical decisions.


These are the good news. The bad news is that there is no guarantee against oligarchization: even if you implement all of these suggestions, there is still a chance that some people would become much more powerful.

What else should we know?

Not all organizations or networks should be democratic. Some of them are designed to be fast and efficient and might not meet the strickt definition of "democratic organization", but it only becomes a problem when its members actively do something to exceed their power. 

How can we use this information right away?

Here is a printable checklist for you to check whether your organization or partnership have signs of oligarchy. So grab a cup of coffee and test yourself :)

Follow-up questions from subscribers:

Q: It seems that our organization is oligarchic (oops) but everyone seems satisfied with the current situation. Should we still take action?

A: yes, you should. There are several reasons why "oligarchization" is problematic in the long run, even without any obvious conflicts so far. When regular members are less involved, it:

  • Limits diversity of ideas and innovation.

  • Reduces your legitimacy (whether or not members accept you as a rightful leader).

  • May affect long-term goals. Often, leadership prioritizes attracting more members, even if it means altering the organization's direction, a process termed "goal displacement." Let me know if you'd like further details on this.