Workplace democracy

Would you be willing to have your colleagues decide on how much you make and what value you bring to the organization?

This type of radical transparency is bound to make a lot of people uncomfortable but it’s exactly the type of visibility that employees at Semco, a Brazilian industrial manufacturing company, have into the operations of the company.

Employees set their own wages, productivity targets, schedules and even choose their managers. Moreover, for important strategic decisions Semco each of the company’s 3000 employees votes – whether it’s about a merger, an acquisition, or plant relocations. For other less strategic discussions employees have two open seats on the Board of Directors that anybody can occupy on a first-come first serve basis. And finally in order to stimulate new ideas, the company holds a monthly “idea meeting” to put creative employees in touch with those with budgetary control – an internal VC club.

Key to enabling this culture of openness has been SEMCO CEO Ricardo Semler’s firm commitment to doing things differently (he fired 60% of the company’s top management when he took over).

This video clip highlights some of the company’s unique HR practices.

Given the company’s success in the two-decades of its anarchic-management practice (its revenues have grown from $4 million to over $250million), is this type of transparency and workplace democracy indicative of an HR strategy the rest of us have missed the boat on?

Why does it work at SEMCO?
Why wouldn’t it work at your organization?
What type of industry/market is best suited to such structures?
Is this type of radical self-organization the future of the workplace?

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