The proof’s in the pudding

When Miguel de Cervantes published The History of Don Quixote in 1615, it’s fair to assume he had no idea how his book would continue to resonate. Among the enduring nuggets: “The proof of the pudding is in the eating”, a phrase widely believed to mean that to fully test something, you need to experience it yourself. Try it, test it, then accept it. That’s the tack taken by another Latin creative thinker centuries later. Ricardo Semler is the CEO and majority owner of the Brazilian company, Semco, an enterprise that has attracted academic and investor attention as much for its innovative management approaches as for its consistent profitability. Semler and his workforce have tried the pudding and found it works, yet his radical style of “industrial democracy” remains at the margins of the corporate world. For a start, Semco’s encouragement of constant questioning would set many management teams on edge. In just about any situation, “we simply ask ‘Why?’ three times in a row,” Semler explains. ”‘Why do you do things the way you do? Why is it important for people to come in at the same time? Why is it important for meetings to happen in a certain way?’ You keep asking why and you generally get to the answer, ‘it is what it is.’ And when people realise they’re stuck in a mode they really can’t explain, this works wonders in breaking down resistance and opening up new possibilities.” Semco’s 30-year experiment has ranged from an adaptable system of flexible pay to a ‘rush-hour MBA’ and a system blurring the lines between retirement and work. The result is far from chaos. Two basic assumptions ensure that staff feel valued and motivated: “Trust in adult behaviour”, and people are best-placed to know where and when they do their best work. “The day that we measured people by time clocked is long gone,” Semler says, invoking Silicon Valley firms like Netflix. “What make sense now is to set up a few parameters for what we’re expecting from you and vice versa. We don’t want to know when or how you’re working, but if you’re fulfilling your commitment.”

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