What happens when an enterprise fails

The problem

An enterprise that cannot fail behaves badly. Certain of rescue, it hoards labour, underinvests, and absorbs resources that other people need. Economies that removed the possibility of failure without replacing it discovered this at length.

The design

Every enterprise operates under a binding resource ceiling and keeps public accounts in physical units. Its federation reviews it yearly, in public, against the needs it undertook to meet. Persistent shortfall opens the support procedure.

Support with a horizon

Support may be granted, and must state the grounds, the measures, the quantities, the results required, and the date it ends. Two years at most, renewable once for one further year on independent evaluation. Capped as a share of the branch. The deciders are named. Expiry without results opens reorganisation automatically, and the same grounds cannot be used again for five years.

Diagnosis first

Before support, the federation must establish whether the difficulty came from the plan, from outside circumstance, from obsolescence, or from the management. If the plan was at fault, the allocation is corrected instead. If the management was, the assembly considers dismissing it.

Nobody is punished for it

Members of a reorganised or dissolved enterprise keep their provision in full, get a place elsewhere that conforms to their own choice, and get training where the new task needs it. The constraint bites on the enterprise, never on the person.