Margins Inc.

When it comes to organization and management, the most innovative company in the world is not a high- tech start up from Silicon Valley, but a Chinese white goods manufacturer.

In the 1990s the Brazilian business leader Ricardo Semler wrote a book entitled Maverick! about his bold and exciting experiments in management at the family company Semco.  When the youthful Semler took over the company he immediately dispensed with 60 per cent of the managers. He went on to make rewards and remuneration at the company transparent and democratic, and much more. Today, Semler continues to lead Semco Partners.

I interviewed Semler in the 1990s as he brought his unique brand of management to the world. He was an inspiring and fascinating interviewee, but not to everyone’s taste. I remember Sir Owen Green, who had created the British conglomerate BTR, was highly dismissive of Semler’s notions of workplace experimentation and democracy. He was not alone. Mavericks get the column inches but they tend not to be warmly embraced by the corporate status quo.

There have always been experiments in running organizations. The Glacier Project in the UK from 1948 until 1965 sought to bring democracy into the workplace and to better understand employee engagement. It failed to make inroads into management practice.

Usually, such experiments are carried out at the margins of the corporate world. They are outliers. Big corporations plough relentlessly forward, largely unwilling to countenance experimentation in how they manage and organize themselves. If they dabble in alternatives, they tend to be geographically distant from headquarters or in unimportant start-ups they have inadvertently purchased along the way.

Consider the corporate titans of our times. Companies like Apple, Facebook, Google and Amazon are not famed for their managerial innovations. Indeed, if you remove the gimmickry of free food and the like, and the often eye catching architecture, then the twenty-first century corporate behemoth closely resembles its twentieth century counterpart.

And that is what makes the Chinese company Haier a truly unique story.

Download the full article by Stuart Crainer

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