Semco: democracy is in the house!

15 September is the International Day of Democracy. Business guru Ricardo Semler has been serious about making his business fully democratic. With the absence of organization charts, function titles and formal rules (there is a “survival guide”), his company rather seems to be anarchistic. But he has many clever and very unconventional practices for good reasons.
Here is a quick guide:

INCORPORATE 5 CORPORATE ANOMALIES THAT OPTIMIZE DEMOCRACY AND COMMITMENT

Semco

1. No instructions,
nor hour logging

Decide at every relevant moment with any relevant person what to do, given responsibility domains. Work where and when you feel is best. Fancy a Tuesday afternoon on the beach? Just go for it! It’s just that you have to accomplish what’s on your plate. That has certainly not always to do with time.

Say what?! Yes, why not? It’s just that all information about you is public, so if you prove to be greedy and suppressing overall performance, chances get slimmer that you will maintain your job – for which you have to re-apply periodically, while your peers have a say in keeping you where you are.

2. Employees determine
their own salary

3. Employees determine who their boss is, and assess these bosses

Isn’t this straight-out fair? Why would performance assessment be one-way? Shouldn’t the boss also have an added value in the eyes of the employees? Oh, harsh or political assessments may backfire, while you are obviously also assessed from several directions.

Doesn’t this make the greatest sense? If somebody doesn’t show up, the meeting idea was clearly not of enough relevance. Spend the time in a better way. Who meets who for what becomes much more directed by “natural selection”. Conversely, anyone can attend any meetings. Want to join a Board meeting? Go.

4. Meetings are voluntary, and company-public

5. The strategic direction
is up to all

Everybody can have a voice in where the company is going and which activities it will develop in the next period. Just bring in your idea, show commitment to it, and a critical mass supporting it will set that direction. There is a Board, but it’s main function is to keep the company functioning as it does, with these unconventional inventions.

Pretty uncommon, but also pretty sensible, right? The system is based on trust and transparency. You are trusted for whatever you do, and whatever you do is visible to anyone. This leads to great ownership and responsibility. Isn’t that great democracy?

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