SEMCO SA is a company being managed by the son of the founder Antonio Semler, Ricardo Semler. The article examines how SEMCO SA is different from all other organizations. This organization works on a participatory management model. This model has been inspired from the B. L. Gore leadership example. Though this model is highly successful, empowering and famous; no other organization till date has been able to replicate this model successfully. The model has various key points, and specific reasons why no organization has been able to succeed in implementing it and making it work for them.
Semco SA was originally a shipbuilding company that now produces more than 2000 products like dishwashers, digital scanners, banking and environmental services, managing non-core businesses of MNCs like Wal Mart, Carrefour, etc.
Semco employs over 3000 employees with a turnover of just 1%. Workers set their own salaries, share company profits and hire and fire their own managers. The employees say, that their philosophy is built on participation and involvement. They never settle down. They give opinions, seek opportunities and advancement, and say what they think. They never think of themselves as just one more person in the company.
Today, SEMCO is one of the most interesting companies in the world. It has no job titles, no written policies, no HR department, and actually no headquarters either. Half a dozen senior executives pass on the title of the CEO every six months. There are no seniors and no juniors, everybody is associates. Employees decide their own working hours. Every employee is aware of what each other person is doing at SEMCO, and everyone receives a copy of the financial statements, to understand which, they can take classes if they want to. Subordinates choose their managers by vote, and evaluate them with publicly posted results. All meetings are voluntary and the first two who turn up get a seat on the board.
SEMCO today adopts the idea of autonomous teams throughout the organization. Here the employees hire and fire the workers as well as the supervisors through voting. The entire SEMCO has no any policy documents at all. The only manual that it has, is 20 pages long and is full of cartoons.
Ricardo Semler, one of the six counsellors and the founder’s son at SEMCO, firmly says that the purpose of work is not to make money. The purpose of work is to make workers feel good about their lives. The organization has seen all its people in power give up their controls, and yet, SEMCO has seen people controlling themselves and working in a creative and productive manner. The only thing that the employees at SEMCO are obliged to do, is to meet the commitments that they make to themselves and to their fellow associates.
This model of participatory management is inspired by the Bill gore leadership example, the founder of W L Gore and Associates, who is regarded as the first person who experimented with giving freedom in the workplace.
At SEMCO, the responsibility of reviewing themselves and setting targets is entirely on the employees, and nobody else at all.
Here are some principles, drawn from the SEMCO model of participatory management, and Maverick and The seven day weekend, both written by Ricardo Semler –
All this might look far, far away from conventional models of an organization. It may also look like a perfect recipe for disaster. However, this model has worked, and indeed produced excellent results. The revenue of SEMCO has gone up manifold. The employees are immensely happy with their jobs. Not only the employees themselves, but their family members are noticing the positive change in them as well. The stress levels and frustration quotients have nose-dived. People love coming to office each morning.
One of the quotes that Ricardo Semler likes to share in this regard, is that – “Not long ago, the wife of one of our workers came to see a member of our human resource staff. She was puzzled about her husband’s behaviour. He no longer yelled at the kids, she said, and he asked everyone what they wanted to do on the weekends. He wasn’t the usual grumpy, autocratic self he had always been. The woman was worried. She wondered what we were doing to her husband. We realized that as SEMCO had changed for the better, so had he too.”
Interesting is, that if this model is so successful and yields such excellent results, why don’t all organizations have it?
The reason for it could be many. But there are two main reasons that shall always remain common. One, the fear of change. Many managers consider the changes that SEMCO went through as a bit too extreme and even unnecessary in the light of concurrent global environment. Many argue that such drastic measures were unnecessary to achieve the same level of success. And secondly, the reluctance of people in power to give away power. Freedom and lack of autocracy are the principal features of SEMCO. Here, there are no conventional divisions and boundaries of a boss and a subordinate, all are associates. For most bosses, it is very important to be the BOSS. In order to adopt this participatory model, it is essential that the people in power let go of their power, and give freedom to the employees. This letting go, is something no other organization has been able to do effectively though many have tried. Even if they do, at some point of time or other, the BOSS behaviour takes over and the model goes out the window. People need to realize that it takes time. Even SEMCO wasn’t able to come up with it, implement it, and prove itself overnight.
Ricardo Semler has successfully created this model in all organizations that today are part of the SEMCO group. He has replicated it in all of them and they are functioning very successfully. The only fear that Semler currently has is that the model might break if the company grows too fast or makes too much of money.
All in all, SEMCO has done something and proved its worth, which nobody has ever been able to copy or replicate. Today SEMCO is a case study for all of us, but nobody has been able to materialize it. It would indeed be nice, if some organization could actually make this model work for them.
This article has been authored by Bhavi Patel from IRMA.
Views expressed in the article are personal. The articles are for educational & academic purpose only, and have been uploaded by the MBA Skool Team.
If you are interested in writing articles for us, Submit Here
What is MBA Skool?About Us
MBA Skool is a Knowledge Resource for Management Students, Aspirants & Professionals.
Quizzes & Skills
Quizzes test your expertise in business and Skill tests evaluate your management traits
All Business Sections
Write for Us