...1 Ricardo Semler The Brazilian CEO and best-selling author transformed his pump plant into a model of participative management, and launched his company on 14 straight years of double-digit growth. by Lawrence M. Fisher strategy + business issue 41 Won’t Take features the creative mind Photographs by Rogério Reis / Blackstar Control Semco Group Chief Executive Ricardo Semler at his impromptu office — a coffee shop near his company’s headquarters 2 features the creative mind Lawrence M. Fisher (fisher_larry@strategybusiness.com), a contributing editor to strategy+business, covered technology for the New York Times for 15 years and has written for dozens of other business publications. Mr. Fisher is based in San Francisco. 3 Like many chief executives, Ricardo Semler used to wonder what would happen to his company if he were hit by a truck. One night in February 2005, he found out — while driving 85 miles per hour on a highway in Brazil. Miraculously, he was still alive within the 20-inch pancake of crushed steel and shattered glass that remained of his car. Also miraculously, his company, Semco Group, of São Paulo, Brazil, carried on seamlessly during the months he spent lying in intensive care and recuperating from the multiple surgeries he needed to repair his broken neck and battered face. Numbers were met, deals were closed, and business continued pretty much as usual. Mr. Semler, 46, is the leading proponent and most tireless evangelist...
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...Ricardo Semler and Semco 'When I took over Semco from my father, it was a traditional company in every respect with a pyramid structure and a rule for every contingency. Today our factory workers sometimes set their own production quotas and even come in their own time to meet them without prodding from management or overtime pay. They help redesign the products, the make and formulate the marketing plans. Their bosses for their part can run our business units with extraordinary freedom determining business strategy without interference from the top brass. They even set their own salaries with no strings. Then again everyone will know what they are since all financial information at Semco is openly discussed. Our workers have unlimited access to our books. To show we are serious about this, Semco with the labour unions that represent our workers developed a course to teach everyone, including messengers and cleaning people, to read balance sheets and cash flow statements. We don't have receptionists. We don't think that they are necessary. We don't have secretaries either, or personal assistants. We don't believe in cluttering the payroll with un-gratifying dead-end jobs. Everyone at Semco, even top managers, fetch guests, stand over photocopiers, send faxes, type letters and use the phone. We have stripped away the unnecessary perks and privileges that feed the ego, but hurt the balance sheet and distract everyone from the crucial corporate tasks of making, selling...
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...people like adult, and they will respond like adults” This is the philosophy of Ricardo Semler, which is used to build the business Semco Group with great leadership management. Ricardo Semler that only one person breaks all the traditional rules of leadership and making their own rules. Other business also can belief and follow this philosophy because can improve and more positive in leadership management to build great management. Every people have their own ego, so if we serve them with proper or right method they also will give good feedback. Example the employees was done wrong step in production, so the manager reprimand and correcting them with right way not to anger to them. So the employees will accept the reprimand and remind the step also, indirectly the production will increase and more quality will produce. In this situation the employee easier and more comfort to working with this environment. In the modern life style, every people have their own behaviour that different with each other. Ricardo Semler belief that the “organization thrive best by entrusting employees to apply their creativity and ingenuity in service of the whole enterprise, and to make important decisions close to the flow of work, conceivably include the selection and election of their bosses”. Good environments of working also paste a role to contribute more quality in production. Ricardo Semler wants all our people to feel free to change and adapt their working area as they...
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...Radical Leadership RADICAL LEADERSHIP I. Significant Case Facts Ricardo Semler the CEO of Semco Group of São Paolo, Brazil was not just the typical or traditional leader. He is radical; he breaks all the traditional “rules” of leading. He’s the ultimate hands-off leader; he doesn’t even have an office at the company’s headquarters. Semler’s philosophy is simple: Treat people like adult and they’ll respond like adults. Semler’s participative management approach is the belief that “organizations thrive best by entrusting employees to apply their creativity and ingenuity in service of the whole enterprise, and to make important decisions close to the flow of work, conceivably including the selection of their bosses.” And according to Semler, his approach works well. The employees have free will because there are no organizational charts, no long term plans, no corporate values statements, no dress codes, and no written rules or policy manuals. They also decide their work hours and their pay levels. The employees also select the corporate leadership and decide most of the company’s new strategic initiatives. Semler maintains his approach and has enabled Semco to survive the roller-coaster nature of Brazilian politics. Semco not just survive but also prosper. Semler says “If you look at Semco’s numbers, we’ve grown 27.5 percent a year for 14 years.” And Semler attributes that fact to flexibility…of his company and, most importantly of his...
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...1 Ricardo Semler The Brazilian CEO and best-selling author transformed his pump plant into a model of participative management, and launched his company on 14 straight years of double-digit growth. by Lawrence M. Fisher strategy + business issue 41 Won’t Take features the creative mind Photographs by Rogério Reis / Blackstar Control Semco Group Chief Executive Ricardo Semler at his impromptu office — a coffee shop near his company’s headquarters 2 features the creative mind Lawrence M. Fisher (fisher_larry@strategybusiness.com), a contributing editor to strategy+business, covered technology for the New York Times for 15 years and has written for dozens of other business publications. Mr. Fisher is based in San Francisco. 3 Like many chief executives, Ricardo Semler used to wonder what would happen to his company if he were hit by a truck. One night in February 2005, he found out — while driving 85 miles per hour on a highway in Brazil. Miraculously, he was still alive within the 20-inch pancake of crushed steel and shattered glass that remained of his car. Also miraculously, his company, Semco Group, of São Paulo, Brazil, carried on seamlessly during the months he spent lying in intensive care and recuperating from the multiple surgeries he needed to repair his broken neck and battered face. Numbers were met, deals were closed, and business continued pretty much as usual. Mr. Semler, 46, is the leading proponent and most tireless evangelist...
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...cattle those all cattle were called mavericks. But at present the word maverick is used to identify any person who carries an autonomous position or is unique than another. And that person should be with slight effect of wildness. (Gunderson, Folke, Lee & Holling; 2002) Ricardo Semler was owner of the Semco Corporation in Sao Paulo, Brazil. Semco Corporation of Brazil was his family business. He ran his organization by very beautifully way. He organized his business by using Mavericks in his organization. He made his company successful in all over the world by Mavericks. He made the most revolutionary success history of business of that time period. Those mavericks resisted recession, overcoming inflation, continuous strikes and many more hurdles of business. In all those situations that person had turned Semco Corporation from bottom to the top by removing nine stratums of management and by permitting all employees of his organization unexampled democracy at the place of work. This was his best use of mavericks. Ricardo Semler has given his marvelous ideas of his business by giving practical information about business organization. Those ideas are very useful to all business persons, anywhere. Ricardo Semler has touched off a series of events that has been changed an idle. He has changed a very much...
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...which I have analyzed subsequently through some of my Experiences: * Dehumanized Workers, Lack of Autonomy and Monotony of Work: Introduction of Execute Only concept has led to workers being dehumanized as they were not allowed to voice their opinions while performing an activity. This leads to dissatisfaction among the workers which affects the sustenance of maximum speed state. Monotonous work added fuel to the fire aggravating the level of dissatisfaction among workers. In the famous “Hawthorne Experiment” it was revealed that one of the main factors in productivity improvement is the autonomy allowed at workplace i.e. Involvement and Authority to take decisions in the performed activities. In the famous bestseller “Maverick”, Ricardo Semler – Owner of SEMCO shows that involvement of workers and letting them take decisions has a profound impact on the performance of the organization. Even from my Personal Experience at Tata Group I can state that autonomy and TEI (Total Employee Involvement) is a critical success factor. When I joined my organization I was posted at one of the plant locations at Faridabad where I was supposed to take care of the operations...
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...INTRODUCTION OF SEMCO GROUP OF SAO PAULO: Semco was founded in 1953 in Sao Paolo (Brazil) by Antonio Curt Semler, an Austrian-born engineer. It was rigidly hierarchical company with rules and policies for everything. The company made several products, but was mostly known for its marine pumps. 90% of the sales were to the Brasilian shipbuilding industry. Antonio’s son Ricardo joined the company when he was 19 and clashed with his father’s traditional autocratic style of management. The younger Semler thought the company got too much business from one industry, was too rigid, and needed better financial practices. His father refused to allow changes. Ricardo threatened to leave the company. Then Antonio Semler resigned as CEO and vested majority ownership in his 21-year-old son in 1980. One of Ricardo’s first official acts was to fire 60% of the executives, many of whom were his father's friends, and all the secretaries. New CEO began implementing a diversification strategy and changing the way business was done. A fainting spell when he was 25 made him think about a better work-life balance for himself and his employees. Semco’s workers proposed to take a pay cut, but with three conditions: the profit-sharing percentage would be increased until salaries could be restored; management would take a 40% cut in salary; and the workers would get the right to approve all the expenditures. Semler agreed. As the business climate improved, Semco's revenues and profitability improved dramatically...
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...Introduction Both Southwest Airlines and Semco are successful organizations in their own market segments despite the economic struggles in 1980’s and 1990’s. Southwest Airlines began operating in 1971, its primary operating philosophy is low fares and lots of flights. Much of organization’s success is due to the willingness of its leadership to be innovative. Semco founded by Antonio Semler in 1912, was traditionally managed industrial equipment company. SEMCO is located in Sao Paulo, Brazil. Richard Semler, instituted an employee-friendly and employee empowered management system. Semco’s success is basically attributed to three interdependent core values: employee participation, free sharing of information and profit sharing. Case Study It is widely discussed that both companies share success factors that make them market leaders. Non-conventional organizational structure Non-conventional organizational structure is adopted in both organizations. SMA and Semco both break the rules of hierarchy structure and bureaucracy. SMA adopts decentralized organizational structure. ‘ the company cuts across hierarchical and job distinctions’ (Child). Team work, group decision making, training and stress on positive attitude are greatly embraced at the organization. Job specialization doesn’t go as far with other airlines like it does with Southwest. An example of this is in order to reduce the turnaround time, pilots help to clean the aircraft which rarely ever happens. Also...
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...LEADERSHIP STYLE OF RICARDO SEMLER 1. Describe Ricardo Semlers leadership style. What do you think might be the advantages and drawbacks of his style? Ricardo Semler IS one of the greatest business managers of all times in the Brazilian city Sao Paulo. After joining his father in the company it was his father's believe that if his son does not work for him he will do so for someone else. But to maintain him in the company the father had to resign as the CEO and handed over the vast business to his younger son who was only 21 by then and had just graduated from Harvard Business School. Initially his father used the traditional style of management but his son was to use a more centralize leadership method. To effect this he started by firing all the top managers of the company on the day he started working as the CEO and introducing young innovative minds of whom he knew would adapt easily to his style of management. Having been introduced to run his fathers enterprises immediately after graduating from a business school he moved on to introduce great changes in the working environment and ended up having the best productive workforce. With a turn over of less that $ 4 million at his entry he led the company to an annual turnover of $ 212 million in 2003. When you treat your employees like adults they purely behave like adults and hence they become more productive and dedicate themselves to the work environment. With these changes he allowed and encouraged the employees to evaluate...
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...Ricardo Semler: A Revolutionary Model of Leadership TEACHING NOTE 04/2014-5982 This teaching note was written by William W. Maddux, Associate Professor of Organisational Behaviour at INSEAD, and Roderick I. Swaab, Assistant Professor of Organisational Behaviour at INSEAD, in conjunction with Betania Tanure, Professor of Organisational Behaviour at PUC / BTA, and case writer Elin Williams, as an aid to instructors in the classroom use of the case “Ricardo Semler: A Revolutionary Model of Leadership”. Financial support from INSEAD Alumni Fund is gratefully acknowledged. Instructors can register and login at cases.insead.edu to access instructor-only material supporting INSEAD case studies (e.g., videos, handouts, spreadsheets, links). Copyright © 2014 INSEAD COPIES MAY NOT BE MADE WITHOUT PERMISSION. NO PART OF THIS PUBLICATION MAY BE COPIED, STORED, TRANSMITTED, REPRODUCED OR DISTRIBUTED IN ANY FORM OR MEDIUM WHATSOEVER WITHOUT THE PERMISSION OF THE COPYRIGHT OWNER. This complimentary copy is for the authors’ use only. Copying or posting online is a copyright infringement. The Story The case follows the story of Brazilian business leader Ricardo Semler, who took the family marine-pump business to multi-national, multi-sector success. However, this is no typical business success story. First, Semler dramatically changed his own leadership style by relinquishing control and working less hard. Next, he set about transforming Semco, the company founded by...
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...Adejumoke Olaniyan DR Kolawole Sonaike Healthcare Leadership and Management (HCM618 -1601 -HDFSN) February 6 2016 Discussion Questions 1. Evaluate this situation from the view point of David Edmondson’s ethical leadership. What could Radio Shack have done differently? In this world some people crave money and power. To benefit these two things always, people choose the wrong paths. David Edmondson is one of them, because he cheated on his resume. David Edmondson is a fraud that means he is not an ethical leader at all. Because of Edmondson’s cheating his company RadioShack faced losses, so he didn’t do ethical leadership in his workplace. If a manager cheats, lies, steals, manipulates, take advantages of situations, or treat others unfairly that is not an ethical behavior. That is called unethical behavior. We can see lying on David Edmondson’s case, so we can say that he didn’t behave as an ethical leader. According to the text, “Ethical leadership is known as our core values and having the courage to live them in all parts of our life in service of the common good.” Before entering to a company a manager should know what is ethical leadership. If a manager doesn’t know what ethical leadership is, then he/she will never fulfill their job properly. If a manager doesn’t have knowledge about ethical leadership, then he will do unethical things in a company. Also, unethical leadership can create many problems, such as ethical lapses...
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...1.) What HR problems were evident at the Denver Mint? Hostile Environment The main HR problem at Denver Mint was the lack of employee safety especially the women group at Denver. The women were facing a hostile work environment. For one they were under constant sexual harassment from their co-workers. For example, the case of the pornographic materials stashed in the toilet. The other example is the proposition by the male supervisor to the lady who had just come from her passing leave of her late husband. It is the responsibility of every employer to make certain the safety of their workers and protecting employees from sexual environment should be one of them. Not only had Denver Mint failed to ensure the safety of its female staff but also made it worse by participating in it. For instance the case of the male supervisor propositioning the female sub-ordinate. His duty is to ensure her safety not endanger it. Longer time to act on complaints The other HR problem is that it took Denver Mint long to act on complaints forwarded by the staff. For instance the female employee that filed a petition in 2000 with the facility’s EEO officer only had a hearing in 2003. Not only had that the ruling favoured the company. This shows not only lack of speed in acting to complaints but unfair ruling. Another HR problem is The lack of equal employment opportunities (EEO). Denver Mint favoured the male staff and any female staff that filed complaints it took longer to act on it and...
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...Ricardo Semler is one of the greatest business managers of all times in the Brazilian city Sao Paulo. After joining his father in the company it was his father's believe that if his son does not work for him he will do so for someone else. But to maintain him in the company the father had to resign as the CEO and handed over the vast business to his younger son who was only 21 by then and had just graduated from Harvard Business School. Initially his father used the traditional style of management but his son was to use a more centralize leadership method. To effect this he started by firing all the top managers of the company on the day he started working as the CEO and introducing young innovative minds of whom he knew would adapt easily to his style of management. Having been introduced to run his father’s enterprises immediately after graduating from a business school he moved on to introduce great changes in the working environment and ended up having the best productive workforce. With a turnover of less than $ 4 million at his entry he led the company to an annual turnover of $ 212 million in 2003. When you treat your employees like adults they purely behave like adults and hence they become more productive and dedicate themselves to the work environment. With these changes he allowed and encouraged the employees to evaluate themselves and their managers as well. They were also encouraged to rate themselves as to how much they should be paid and learn each other’s jobs...
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...Hobbes describes realism as all men interacting in anarchy and are equal. They are motivated by competition (scarcity), glory and diffidence. Realism emphasizes on constrains on politics imposed by egoism and the absence of anarchy which require ‘the primacy in all political life of power and security’ (Donnelly, 2009).Realists rely on themselves and do not recognize any authority in anyone and pursue power at all cost at national interest to achieve sovereignty which results them to maximize their military power to ensure survival. This leads to security dilemma (Dunne & Schimdt, 2011). The main difference between classical realism and neo-realism is the determinants of state behaviour. For neo-realists, the balance of power is a main motivation due to human nature According to the 6 principles of Morgenthau’s Politics of Nation, politics is governed by laws created by human nature and revolves around the concept of interest, defined in terms of power. This leads to classical realists being pessimistic. States act in a selfish and competitive manner in a constant state of anarchy seeking power. Neo-realists however think that economic resources and military powers are important to influence other states to achieve hegemonic stability (Dunne & Schimdt, 2011). Realism revolves around 3 core elements; statism, survival and self-help. Statism is the ideology that instils the belief that community are protected and sustained by states. This allows the states to increase their...
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