Managing without managers - Ricardo Semler

Summary of the case

1. Prepared by: Anuraag Behera PGP/18/236 Dushyant Bheda PGP/18/237 Munisha Aggarwal PGP/18/258 Kshitij Patil PGP/18/260 Shweta Singh PGP/18/273 Arnab Roy PGP/17-D/199 Managing Without Managers by Ricardo Semler

2. Background

3. Democracy Divided facility in three separate plants which increased “sense of belonging” Increased productivity. Helped reducing work size by 32% through attrition and retirement incentives

4. Counselors Partners Associates & Coordinators Pyramid structure generally used in Manufacturing firm Pyramid circle structure used by Semco Pyramid to organizational circle structure Overcoming Biggest Obstacle: Hierarchy Major changes incorporated:- Subordinate evaluating managers Questionnaire about company’s creditability and top management competence Company - wide vote

5. Abolish norms, manuals, rules & regulations Rule of common sense to promote personal responsibility Lost in space approach Flexibility provieded to factory floor as well by making each cell self-contained Job rotation every 2-5 years Provide job security to people over 50 or people served over 3 years Adult Hiring Treating employees as if they are adults allow workers to use common sense and in turn promotes personal responsibilities Letting them do whatever the hell they want breeds a culture of capable, accountable and responsible employees

6. Issues with the current situation If you don’t appoint a leader, one will emerge Roles FIND the person Results not status Hunting the Wholly Mammoth Solution is PROFIT SHARING Corporate profit sharing is today’s mammoth meat Most successful when there is a broad program of employee participation, when profit sharing criteria are clear and simple

7. Transparency Sharing all of the information & not holding back anything Share monthly results with the employees Employees trained to read and understand balance sheet and cash flow statements Confidential Salaries Simple accounting system providing relevant information The relevant information became insignificant Liberty to do what they want Employees can Choose your own: Pay Job Title Dress Code Office Decorations Work Hours

8. Conclusion Semco is a company with unique system breaking the normal notion that a manufacturing firm needs to have mechanistic structure. Participation in decision making gives people control of their work, profit sharing gives them a reason to do it better, information tell them what is working and what is not.

9. Thank you