Participatory management is the practice of empowering members of a group, such as employees of a company or citizens of a community, to participate in organizational decision making. It is used as an alternative to traditional vertical management structures, which has shown to be less effective as participants are growing less interested in their leader's expectations due to a lack of recognition of the participant's effort or opinion.
This practice grew out of the human relations movement in the 1920s, and is based on some of the principles discovered by scholars doing research in management and organization studies, most notably the Hawthorne Experiments that led to the Hawthorne Effect.
While group leaders still retain final decision-making authority when participatory management is practiced, participants are encouraged to voice their opinions about their current environment. In the workplace, this concept is sometimes considered industrial democracy.
The participatory management model or at least techniques for systematically sharing authority emphasize concerns with the delegation of decision making authority to employees. Participatory management has cut across many disciplines such as Public Administration, Urban Planning, and Public Policy Making. In theory, the model does much more than recognize that employees ought to be able to recommend changes or course of action, but rather reflect a belief that authority should be transferred to and shared with employees. The belief in this theory stems from understanding what the culture of an organization or institution represents. Conceptually, organizational culture is thought to represent a symbolic and ideal system composed of values and norms implemented by its founders, then shared and reflected to influence behavior of its members or employees in the institution. The culture of the organization or institution is in turn used to guide the meaning of the organizations work. 
There are certain institutions that successfully participate in organizational structures specific to hierarchical management models, thereby configuring power distribution, authority, communication and decision making. In an Organizational Structure, or Classical Management, employees do not participate in the decision making process. Employees receive, interpret and carry out orders after the decisions are made by administrators. Participatory management is a shift in the management paradigm from a top-down approach to a more self-facilitated and self-sustained approach. Employees are given the freedom and responsibility, accompanied by all the necessary tools needed to delegate decision making, authority and evaluations of existing and foreseeable/unforeseeable problems.  One tool in participatory management is implementing a Contingency Theory approach. This theoretical approach acknowledges that every problem is different, therefore every problem requires different approaches and solutions.Principles of participatory management consist of fundamental ideas that seek to empower and enhance the employee’s understanding of problems as to explore and generate the greatest potential solutions embodying the ideals of democratic inclusion and participation.
Shifting to & Implementing Participatory Management
Shifting the paradigm from classical management to participatory management requires a collaborative consensus as an organization or institution with communication, inclusion, transparency and development. Creating and sustaining an adaptive capacity for ongoing problem solving with an emphasis on social and trans-formative learning through trust, sustained engagement, and relationship development are important factors when contributing to the overall success or failure of participatory management. Fostering a comfortable environment for employees by creating transparency and building new relationships support broad participation in ongoing planning, implementation, and evaluations which sustains diverse participation in managing expectations and actions with a collective understanding of goals and outcomes. 
When implementing this theory, the only thing for certain is uncertainty. Managing uncertainty must be conceptually addressed to reduce conflict. Conflict can stem from problems caused by misinterpretation, or lack of clarity when it comes to communication or questions concerning values, relationships, and goals. 
Deliberative, collaborative, and consensus based approaches facilitate trans-formative learning as it includes an array of diverse perspectives to optimize learning outcomes through the interaction of values, interests, and worldviews also known as, collaborative science or collaborative method of consensus. Incorporating this approach to participatory management facilitates shared learning and makes the institution and team development stronger, through the contribution of individuals. Communicating values, creating a safe and comfortable environment along with a genuine and concerted effort should be at the foundation of an organization or institution aiming to implement participatory management as a successful tool.
Examples of Implementation
The ideals of Participatory Management have been implemented in several different industries and sectors, both successfully and unsuccessfully.
One such shift in management styles was studied in a public hospital in Alberta, Canada in 2009. The hospital implemented a Care Transformation Initiative that focused on eliminating wasteful activities and actions and applying an atmosphere of participatory management. This initiative was only implemented in one of the programs in the hospital. That program was studied along with another program in which the initiative was not implemented. The main findings of the study showed that, first of all, organizational change is difficult and takes time. Some workers, particularly older ones, were resistant to the change. The management and clinical staff reported little understanding of their specific contribution to organizational decisions. Despite these challenges, staff also reported feeling optimism that this organizational change may lead to better change in the future. 
A different study reviewed the effect of participatory management already in effect in the automobile industry in Macedonia. This workplace had already experienced the shift from a top down management style to this new participatory management style. The existence of participation was analyzed through the existence of participatory strategic planning and effective supervisory communication. The findings of this study showed that employees who thought their managers listened to them, and who thought they had a voice in decisions, were significantly happier and more productive than those who did not have the same feelings about the workplace.
Participatory Management in Different Cultures
According to studies conducted with regard to various cultures, the reported extent of use of participatory leadership among the Iranian managers correlated significantly and positively with the reported extent of use of motivation via teamwork, the reported effectiveness of communication, the reported extent of group participation in the decision-making process, and the reported extent of group participation in the control process. This trend is particularly present among Iranian, Saudi-Arabian, and American cultures. However, American managerial styles cannot simply be transplanted to other cultures; participatory management styles must be adapted to each culture's beliefs system.
Caribbean cultures have also adapted forms of participatory management among managers. According to the Report on the Caribbean Symposium on Social Development held in Barbados in March 1995, "Empowerment is facilitated when agencies make a genuine commitment to shared responsibility and joint decision making, design projects and programs around the perceived needs and the involvement of beneficiaries, adopt community-based and gender-sensitive approaches." Community-based management in these cultures not only improves employer-employee relationships, it enhances employee output as well.
Multiple criticisms exist in opposition to participatory management as a result of its massive change from traditional management styles.
One of the major concerns put forward by the need for massive change is that of high monetary and resource costs. For this reason, institutions often attempt to only partially implement participatory management or do so in stages. During this process the concept fails to be completely respected by leaders and participants and thus fails, and is often reversed before it is ever able to be properly implemented. This indicates that the change required for true participatory management may be too much for larger organizations.
Another issue seen in the participatory management concept is the potential for poor quality participation. Especially when implemented for large scale use, such as with the citizens of a city, it has been shown that if participants are not fully aware of their ability to participate or if they are not properly informed by leaders on what feedback they are expected to provide, there will be either minimal or passive participation. 
As a combination of criticisms, an overall result of failure in participatory management is misrepresentation of participants. Along with the factors involved in the previously stated criticisms, misrepresentation can also be due to unexpected participants providing feedback when the expected participants did not, typically seen in city management where participatory management was implemented as an attempt to exploit the community's perceived bias towards a certain decision. This could result in an unexpected voting outcome. As well, any decision could be swayed by participants being coerced within the system to provide feedback in pursuit of someone else's agenda.
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The Foundation for Development Cooperation - Provider of effective Participatory Project Management Training Workshops in the Asia-Pacific Region