The formula for successful business books as of late is often as follows:
- Novel observation: highly improbable stuff happens/little things make a big difference/committing to success leads to failure
- Distinctive title: The Black Swan/The Tipping Point/The Strategy Paradox
Maverick, by Ricardo Semler, doesn’t follow this pattern. Not that it’s formula is particularly original (business leader recounts success story). In fact, the book is almost quaint and cute in terms of its style. First, it was published in 1993 – eons old in the world of most business books. Second, the author, Brazilian CEO Ricardo Semler writes with an energy and an almost kid-like passion that I think would make most CEOs self-conscious.
The book follows the journey of the author as a 20 year old being passed the keys to his father’s successful corporation, firing the bulk of the executive ranks (20-30 years his senior) and then spending the next couple of decades evolving Semco’s policies and culture to what he calls a “natural business”. I’ve always hoped that as we build Jackson Fish Market it will grow in a natural and healthy fashion… I’ve informally referred to that notion as building an “organic” business. Semler’s “natural business” (while based on experience instead of hopes and speculation like ours) doesn’t seem that far apart. And frankly, it seems pretty logical.
Semler’s basic philosophy is to treat employees like adults. He points out that even the most die hard believers in democracy and individual rights of the citizen come to work and become die-hard believers in autocracy, central authority, and rigid conformity. And it’s a good point. Why the difference? No doubt some CEOs would explain that running a society and running a company are diametrically opposite with a competitive industrial enterprise requiring thousands of cogs (people) to operate in perfect unison to achieve success. Semler would beg to differ.
And it’s not like he started out with these philosophies. He began his career pushing for efficiency and standardization that often infest all large companies. And, as they often do, these mechanisms result in greater productivity and profitability… for awhile. But Semler noticed that even as profits improved, the employees at the company seemed less motivated and committed than ever before.
The answer, democracy and common sense. They had tried to write new rules describing their new culture, but as Semler puts it:
“Only then did we say aloud what we had been thinking: that we were trading written rules for common sense. And that is the system we have today, which is barely a system at all. When you get a company car at Semco, you can do anything you want with it. If you have a friend who is a mechanic, have him take care of it. We want our employees to treat Semco’s vehicles as they would the family sedan. We’re comfortable having their judgment apply to our car as well as theirs. But this was all terribly frightening to some of our people, especially at first. We had to do lots of hand holding. Clerks in our finance department, for example, weren’t comfortable deciding how much Semco should keep as minimum balances in its checking accounts. ‘Just think of them as your accounts,’ I would say. ‘But Semco has so many accounts,’ they would reply. ‘What happens if we have an emergency and need cash.? And I would take a deep breath, and implore them, one more time, to use their common sense.”
This is just one example but they go on and on throughout the book. Not only are they entertaining, but the principles he espouses don’t just make sense, they reawaken your faith that there’s an alternative mechanism for running a business.
While not every large business is run in the traditional way, or experiencing the kind of problems mentioned above, I would imagine that most people who have experience with one or two large companies will be dreaming of sending copies of this book to those large company CEOs by the time they’ve made it through the book. Semler’s philosophies seem just the prescription for enormous companies that are struggling with employee morale, product quality, and customer loyalty.
Since we don’t have any full-time employees just yet (only full-time owners) it’s probably a little premature to start implementing all of Semler’s philosophies. However, it’s hopefully not too early to start thinking along the lines of the business as being a collection of talented and creative grownups who are coming together to do great things. It’s the basic premise on which our business was founded, and it’s so nice to have Ricardo Semler’s inspirational book to reaffirm the direction we hope to take.