More on democratic workplaces

A little while back I mentioned democratic workplaces and WorldBlu. Some may find the notion of democracy in the workplace an interesting idea, but not really practical. To change your mind, listen to Ricardo Semler as he explains the flaws of our industrial work structures and what he has done with his company of 1,400 workers who vote for their bosses, only attend meetings that they want to and figure out their own remuneration plan. After 25 years in business, the company has had an average of a 20% rate of return, even with the economic turmoil of its host country, Brazil. It also has only 1% employee turnover.

Semler, author of Maverick: The Success Story Behind the World’s Most Unusual Workplace and The Seven-Day Weekend: Changing the Way Work Works, says that historically no real change has ever come from inside an industry. In my mind this questions the whole assumption of letting the market decide what is best for society and gives a very important role to government – forcing innovation on industry, such as more fuel-efficient cars.  He says that the primary key to innovation is intuition, not analysis or faster processing or access to more information.

The main message of this talk at the MIT Sloan School of Management is that we need to undo our dominant  business models which are the legacy of military hierarchies because they are inefficient, ineffective and stifle innovation. He uses the automobile industry as an example of an industry that has only made incremental advances in the last 100 years, still relying on the combustion engine and fossil fuels.

Even the “new economy” has been undone by our hierarchies. Semler cites the example that many of us have learned how to send e-mails on a Sunday night but few of us have learned how to go to a movie on a Monday afternoon. As a result, we have unbalanced our lives. During the second half of this 48 minute video/audio Semler gives some examples on how his company has created a truly democratic and competitive company.

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8 Responses to “More on democratic workplaces”

  1. Mark Dowds

    Harold, great post. I am sitting in Boston Airport after a couple of days with Traci and gang from Worldblu in a roundtable dialogue for leaders of democratic companies. It was inspiring. We met at the http://www.dcontinuum.com offices who were great hosts and a lot of fun. The amazing thing about gathering a gang of leaders from influential organizations committed to democratic priciples is the conversations that emerged. Having folks like this who view the world and business different than most leads to some very innovative ways of thinking. I must admit, it was a relief to meet others who are working through the excitement and pain of organizational and human transformation. I would never go back to how I thought before about how a company should be led.

  2. Daniele Di Fausto

    Our Company eFM was born in 2001accordind to the key principles of Ricardo Semler (Working without rules).
    There are no job titles and no managers.
    From 6 employes no we are a group of 200 employes. Our average growth is 25% per year. I LOVED MY COMPANY AND MY COLLEAGUES ARE MY FRIEND.
    GREAT ARTICLE.