(Ricardo Semler, Warner Books, 1993 $22.95, probably in paperback)
Ricardo Semler is the son of a wealthy Brazilian industrialist who was not accepted at Harvard University. So his father made him the CEO of Semco. Maverick tells the story of the revolutionary changes Ricardo Semler made in Semco.
Semco was a traditionally structured industrial pump manufacturer. Founder Antonio Curt Semler retired in 1980, giving the company to his son Ricardo, who was only 21. Young Semler proceeded to fire most of the top managers in an effort to perform emergency surgery on the foundering company. Initially, Semler concentrated on keeping the company afloat. But once the company's financial position stabilized, he proceeded to buy other companies and diversify.
As Semco grew, Semler gradually made innovations, such as doing away with dress codes, introducing flex time, and encouraging employees to take more ownership of their work. These are all areas that many companies have experimented with over the last fifteen years. However, Semler went much further. He questioned many standard office practices and reinvented some of them. After seeing a company order for $50,000 worth of file cabinets, he decreed that every person would clean out their own file cabinets and keep only what was absolutely necessary. Not only did Semco not need to order more file cabinets, Semco sold off now unneeded-file cabinets.
Semler believes a primary evil in today's industry is an over-abundance of paperwork. He says he delegates almost everything, and limits his business reading to two daily papers and two weekly magazines.
Semler stresses the importance of working with unions to keep the company healthy. During some strikes, striking employees were allowed to come on site and use the cafeteria, so long as they did not interfere with anyone who was working. Semco introduced the following rules for dealing with strikes:
While there have been strikes at Semco companies, Semler does not discuss them with the kind of animosity often seen when American industrialists describe the strikes at their companies. The strikes at Semco have tended to be brief and non-violent.
Semler complains about the evils of centralization, the concentration of power in upper management, and the hierarchical structure of management. He stresses the importance of redesigning the company, avoiding "dead end" jobs, and encouraging every employee to feel responsible for the company as a whole. He tells the old story about the three stone cutters, and praises the man who can see the cathedral in the stone he's cutting.
Semler tells his story in a conversational style, which makes this book much less ponderous than many books about business. As Semler dislikes graphs and charts, you will not find any in this book. However, you will find an English translation of the company's very brief personnel handbook in an appendix, complete with cartoons.
One reason for the continuing existence of Semco has been the willingness of Semler and the Semco's manager to adapt. Brazil's economy has forced thousands of companies to shut down, laying off hundreds of thousands of workers. While Semco has had some layoffs and has closed some plants, it also spun off nearly two dozen satellite companies. In an effort to decentralize, these satellite companies contract back some services to Semco in addition to soliciting independent business.
The main lesson American businesses can learn is to not fear innovation. The main reason companies have failed over the last 20 years is the company's failure to adapt to a changing economy and society. And that is the main lesson of Maverick: don't be blown away by change--lead it!