Abstract
The paper focuses on Semco Partners and the group of companies. Attention is given to its unique management style that involves employee autonomy and liberty in workplace decision making. The success of the Semco enterprise precipitated by the radical management style and administration strategy is studied. The CEO, Ricardo Semler, uses the employee-centered style that is considered within with the view of establishing the relationship of the strategy and business performance. The success of this culture and style of management is visible in the many ventures that the $400 million dollars enterprise has started. Eth an energy industry company, BrasilAgro a real estate and infrastructure development company, Tarpon in stock management, Juritas a law firm amongst other private equity NGOs are amongst the comprehensive industry portfolio successful startups of Semco. The founder’s management strategies are also compared with the current policy of Semler with an exploration of the values that Semler holds in regard. The sustainability of the culture is also investigated in the long run with a background contrast with the writers’ former workplace compatibility of the culture.
1. Briefly describe the organization. Semco Group is an engineering company formed around 1950, which is a specialist in design and production of disruptive technology backed products. The capital equipment products range from photovoltaic and semiconductor. The successor company SEMCO partner is a modernized management firm that deals with a range of ventures in environmental consultancy, inventory services, and brokerage of real estate. The company acts as a portfolio administrator for Brazilian-based companies, especially those new in the Brazil market sphere. SEMCO operates with a maximum of seven companies at any given time with each enterprise having a customized structure and management team (Kimakowitz, 2011). Ricardo Semler, the C.E.O and majority shareholder uses a unique employee–centric management style that has led to the great success of Semco. The company has a single bureaucracy-free and democratic workplace culture as illustrated in the exposition below.2. What makes Semco successful? The success of Semco can be attributed to the unique management style at the company. The firm has a system where bureaucracy has been taken to the bare minimum with an open consultative culture where everybody is accessible and significant in decision making. The employees elect their leaders through a democratic vote after potential candidates are vetted and interviewed by the employees. The managers have been given a free will to determine their salaries. The company’s system has led to the company’s growth to $160 million from $35 million notwithstanding the economic crisis in just a span of six years (Ion, 2004). The company’s success story is based mainly on the C.E.O, Ricardo Semler’s open and radical management style. Ricardo works with the employee-centered style. The method concentrates on employees’ welfare, and this leads to happier and more satisfied workplace that in turn leads to better quality results and output. With all staff being involved in all the aspects of the business, a sense of transparency exists leading to limited corruption, embezzlement of funds or business malpractices. This helps the company to stay on the course of success and ensures each employee works in the expected and ideal way knowing he/she is under the spotlight.
3. What is unique about the way the company is led?
What is unique about Semler’s management and administration is the system of democracy and radical employee management style. Employees interview and vet potential managers of the company and approve him or her after assessing the results and collective agreement by all. Regular evaluation of the hired managers is done from time to time in an open and inclusive way. As such, the hierarchy of Semco is non-existent as no official leadership structure, department or fixed CEO position exists. The employees vote in new managers after a job rotation ends. The elected managers in turn use consensus to hire new employees (Sachs, 2011). The company has no official job descriptions as positions and designations are fluid, and one can switch job positions if capable of handling another position. The managers on the other hand have been given a free hand in deciding and setting their salaries and remunerations, an entirely radical and uncommon practice unheard of in any other enterprise. If an employee has a complaint to make against the management or coworkers, he or she posts the public official complaint or suggestion where everybody can see. A concerted effort is then launched to resolve the issue by the staff members. The company’s financial statements, reports, audits and another crucially related information are open and accessible to all the employees. This is in a bid to improve transparency and limit malpractices such as funds misappropriations.
4. Management style used by CEO Ricardo Semler and difference between the founders’ and Ricardo’s style. The CEO of Semco Mr. Ricardo Semler uses an employee-centered leadership style. The employee-oriented style gives the staff members democracy, open door policy access to company matters, liberty and innovative initiative with minimum limitations. Also known as the employee-centric leadership, the style draws parallels with the Laissez Faire leadership style. The method gives autonomy to workers and freedom to even decide who will be their leaders, and the managers have the autonomy to decide on their salary remuneration. The non-authoritarian radical style is entirely different from the original leadership style used by the founders of the company. The company was a traditionally run enterprise in every aspect of an average model company. There existed a pyramidal hierarchy organization structure. Also, there existed rules for all contingencies and guidelines for all protocol decisions and scenarios. Ricardo replaced the bureaucratic corporate rigidity into a new fluid structure reducing twelve management layers to just three management structures. The new style by Ricardo encouraged freedom of opinion expression even criticism, unlike the previous regimes’ policy. Contrary to the founders’ demarcations and job specializing policy, Ricardo introduced a non-exclusivity policy where all employees are given an equal status in office duties, guest fetching and non-existence of exclusive dining areas or parking lot space.5. What organizational beliefs and values does Semler hold important? As an integral part of the Laissez Fare and employer centric leadership style, Semler contains important the values of integration and inclusiveness of employees in decision making and running of the day to day business of the organization. The value of transparency in the matters and nature of the company is held high in regard for an honest and open business practices. The company has one set of books of accounts, which is accessible to all and public knowledge (Sachs, 2011). Semler has the belief that it is important for employees to practice creative thinking, innovative thinking, and inventiveness. The belief is what leads to the autonomy and freedom given to employees in decision-making and identification of strategic business opportunities. Primarily, the employees literary run the show and have a no off limit business and workplace restrictions.6. Sustainability of this culture in the long run at Semco. The open employee-centered structure is sustainable in the long term for the Semco Company in a relative way. The sustainability is dependent on a few factors and variables. One determinant factor is the nature of the business ownership status. If the company remains privately owned, the culture will be sustainable since close control is possible. Public ownership would however, limit this if the company went on a public offering. The sustainability of the culture is also dependent on whether the business maintains its entrepreneurial minded approach. A change of the enterprise nature and objectives from a commercial enterprise to a non-profit organization would render the culture unsustainable. The culture is however, sustainable unaffected by the size of the company, big or small, as long as all other remains constant (Ion, 2004).7. The possibility of Implementation of this culture in the company worked for and explanation. I have worked in a multimedia company where a traditional pyramid corporate structure exists. The culture of employee autonomy in Semco cannot successfully be implemented in the enterprise. The reason is due to the public status of the firm and the decision-making mandate by a board of directors. Also, some of the job positions are highly specialized such as coding and computer programming. Implementation of this type of culture would also not be implementable in my former place of work in media publishing due to the sensitive nature of some decisions. Resolution of approval of publishing of journalism reports is highly sensitive as publications deemed to be defamatory or slanderous can lead to lawsuits, prosecution or termination of the business license by the authority
References
Ion, E. (2004). Semco Salvage. London: Lloyd's List.
Kimakowitz, E. (2011). Humanistic management in practice. Basingstoke: Palgrave Macmillan.
Sachs, H. (2011). Semco manufacturing, Inc., petitioner. Chicago: U S Supreme C.
