Seven Day Weekend

Aug 18, 2004

Ricardo Semler's favorite question is "Why?" Why do people routinely bring work home on the weekends but never go to the movies on a Monday afternoon? Why do we need to sit at the same desk every day? Why do we have to fill out time sheets or need an HR department to file them? Why are we interviewed by our bosses but never get to interview someone who wants to be our boss?

For the last twenty years Semler has been doing a lot more than asking questions -- he's actually been running a company by breaking every tenet in the traditional rule book. Semler encourages his employees to play hooky. He tells them not to bother with growth plans. Employees choose their own salaries, set their own hours, and have no job titles. Ridiculous? Inefficient? A recipe for chaos? In his book, Seven Day Weekend, he explains how.

Semler's ideas definitely work. They work so well, in fact, that his company, Semco, has grown from $35 million in revenue to $212 million in the last six years, and even with more than 3,000 employees, it has virtually no turnover.

His top six principles:

• Forget about the top line. Passion of most businesses to keep on growing can be misplaced. Some are meant to stay small. What matters is that they make enough money to survive, whatever the size of their sales - the top line.
  
  
• Never stop being a start-up. Every six months Semco forces each business to rethink its purpose. If it didn't exist today, they ask, would we launch it? If we closed it would we upset important customers? Could we make better use, elsewhere, of the talents and resources tied up in that business?
  
  
• Don't be a nanny. Most companies treat their workers like children, telling them what to do, when to do it, how to dress and how to behave. That way they?ll never think for themselves.
  
  
• Let talent find its place. Semco allows people to choose the projects they want to work on, provided that they can persuade the rest of the group that they can contribute. New recruits join a programme called 'Lost in Space'. They spend their first six months trying out different jobs in different sections until they find a match for their talents.
  
  
• Make decisions quickly and openly is principle number 5, and partner promiscuously is number six. You need help, Semler says, to start a new business. It is pure arrogance to think that you can do it all yourself. Every new venture at Semco has involved some sort of alliance, be it to gain access to software, to draw on someone else's depth of experience, or just to share the risk. Don't be too proud to ask for help, in other words, particularly if it's a market new to you.

Looking around him at the world outside Semco, Ricardo is worried about a hardening of the arteries in many of what were the exciting new businesses around Silicon Valley and elsewhere. The respect for individuals and their ideas, a distrust of bureaucracy and hierarchy, a love of openness and experiment, all the things that Semco holds dear, are beginning, he feels, to be throttled by the old ways of business. CEOs from older businesses are being brought in to provide focus and discipline.

Strategies are being written, human resource departments formed to issue policies and plan careers, entrepreneurs are being pushed to the margins where they are less disruptive. It's sad, says Ricardo, and it isn't necessary.

So his heartfelt plea: You can build a great company, he insists, without fixed plans. You can have an efficient company without rules and controls. You can be unbuttoned and creative without sacrificing profit. All it takes is faith in people.'