THE PEOPLE'S TELEVISION FACTORY
Logue, John
The people's television factory Horsens is a provincial industrial town of 50,000 in Denmark. Despite a Social Democratic city council, it is no center of Labor militance. Quite the contrary: As in...
...The stock was not exactly a secure investment, but some 1,200 individuals were willing to sink some of their savings into saving local jobs...
...The People's Television Factory was never intended as an experiment in workers' management...
...Lindberg, an Arena shop steward, was one of those who took the initiative to save the factory when Rank shut it down...
...And you've got to admit that we did save some jobs...
...Then they shut it down...
...Lindberg sees the result as a qualified success: "While most of those fired when Rank-Arena closed were forced to find other work — and some are still unemployed — we saved 185 jobs, and we've gotten wages back up over the minimum again...
...As a major local employer in Horsens, Arena was the object of considerable civic pride...
...Gyldenkilde is a member of parliament from Horsens...
...The banks' rejection forced 3-F to seek financing elsewhere...
...The deal solved 3-F's marketing and credit problems, but Tungsram demanded the option to acquire majority ownership in 3-F...
...Further, 3-F's continual economic crisis left no margin for experiment...
...But civic pride did not prevent the sale of the company to outside interests — in this case the British multinational Rank, Ltd...
...Ultimately, the opposition was successful — few small firms can be run without bank credit — and the independent 3-F was forced into a marriage of convenience with another multinational...
...What followed was a classic example of how acquisitive giants treat their local purchases...
...They said the wage level was too high," said Lindberg...
...The non-traditional form of ownership at 3-F was an ad hoc solution to the problem of getting capital to reopen the plant...
...Really they had fired so many workers in England already that they were embarrassed to maintain an operating plant in Denmark regardless of the wage scale...
...it was an act of local patriotism...
...While many of those outside Horsens looked for an experiment in workers' management, "on the shop floor," Gyldenkilde says, "it was saving jobs, not a new form of management" that was the issue...
...Though the primary goal was saving jobs, "we hoped to make it a worker-owned company too," says Lindberg...
...They sought to revive the local firm through the sale of what became known as "people's shares...
...Thus the story ends on an ambiguous note...
...But we just couldn't raise the capital...
...Some were employes and many of the rest were local citizens, but quite a few outside Horsens saw the experiment in community control as worthy of support...
...But it should be pointed out that the firm had been considered an unusually good place to work prior to the experiment, and management's responsiveness was illustrated by its role in reviving the firm...
...Here is the story as told by Inger Lindberg and Lilly Gylden-kilde...
...Between them, the two women have thirty years experience in radio-television assembly...
...The local response, however, was highly unusual...
...The response when Rank shut down the Horsens plant in 1975 was anything but typical...
...To the astonishment of many employes and most of the owners of "people's shares," the 3-F board took the Hungarian-owned multinational Tungsram as a suitor...
...Many of the women who were fired didn't dare sink their savings into it...
...But that's what they always say...
...John Logue (John Logue, a specialist in Scandinavian affairs, teaches political science at Kent State University in Ohio...
...No precise explanation was ever forthcoming concerning the banks' refusal to grant credit, but it seems likely that the atypical nature of the firm played a role, as did the banks' worry about the precedent set by local governmental initiative in financing 3-F...
...They could supply the Danish market from England...
...The board pushed through the deal despite opposition, still seeking the initial goal: the preservation of as many jobs as possible...
...Rank owned Arena just long enough to popularize the new brand name Rank-Arena...
...They were single, and they just couldn't take the risk...
...It was a community attempt to save local jobs, jobs that had been lost because of the decision of a corporation headquartered in a foreign city...
...But the problems of starting up a factory that had shut down are numerous, and they were not lessened by the bitter opposition of the other Danish radio and television manufacturers, who threatened and cajoled Danish distributors not to purchase 3-F's production...
...The parallels to the behavior of American conglomerates are clear...
...Take over the plant, its market share, its good will, and close it down...
...One of the local success stories is that of Hede-Nielsen, who started a bicycle shop, built it into a factory, and, changing with the times, went into producing radio and television sets...
...The company survived the boycott through sales to multinationals, ironically including Rank, but wages dropped to the legal minimum, and the number employed plummeted to a fifth of the previous work force...
...the workers on the board were elected by stockholders, not their fellow workers...
...Even so, 3-F faced systematic opposition by the economic powers that be: community involvement in saving and creating jobs in production is a dangerous precedent...
...It was one of the largest local employers, and Horsens already faced a 17 per cent unemployment rate stemming from other plant shutdowns...
...It was considered a good place to work: Wages were higher than the local norm for the unskilled women on the production line, and relations between production-line workers, foremen, and management were good...
...Rank's behavior, says Gyldenkilde, was "a grade school lesson in the behavior of multinationals...
...Tungsram has since exercised its option...
...Led by the company manager, the plant engineer, and Lindberg, they appealed to the local community and, with the help of friendly media coverage, to the national community (more easily done in a small country like Denmark than in the United States...
...four of the five members of the new board of directors, including Lindberg, worked at 3-F...
...The enterprise had substantial community support...
...Gyldenkilde has given up citing 3-F as an example of what communities can do to protect local jobs against distant corporate decisions...
...Quite the contrary: As in towns of comparable size in the United States, it is entrepreneurial initiative that is admired...
...The Horsens city council bought the physical plant from Rank, rented it to 3-F on favorable terms, and eventually sold it to 3-F without a downpayment...
...The new ownership form did not change the work process or democratize managerial decisions...
...But," she comments, "as a worker, I know the aim always was holding on to jobs...
...The stabilization in 3-F's economic situation was torpedoed by bank rejection of a normal business credit line...
...Employes were convinced that the firm was sound, its products good, and their jobs worth fighting for," says Gyldenkilde...
...It was at this point, Gyldenkilde says, that some of the women at 3-F began to wonder about the privileges of property...
...But there is one positive result beyond that: The women at 3-F proved that we don't have to sit still when plants are closed down.'' Currently new orders promise expanded employment at 3-F, but people in Horsens keep their fingers crossed that Tungsram — the heir to 3-F's employes' sacrifice, public support, and community aid — does not repeat Rank's performance...
...it was, for example, the New Orleans based Lykes Corporation, a shipping firm, not a local steel company, that shut down Youngstown Steel and Tube's Campbell plant...
...But even if most of the new stockholders were not workers, there was no worry that they would shut down the plant, which by now had been re-christened "the People's Television Factory" and popularly known by the abbreviation 3-F (for the Danish name Folke/Jern-synsyabrikken...
...Nielsen's radio-television firm, Arena, was a success, with a name for quality and a substantial share of the Danish market...
Vol. 43 • October 1979 • No. 10
