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Democracy in the workplace

By Nick Easen for CNN

Semler took over his father's business in his early twenties.
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Global Office
Corporate Governance
Sao Paulo (Brazil)

(CNN) -- Many command-and-control executives would cringe if employees could set their own pay and hours, view everyone's salary and choose and review their bosses.

But these are just some of the suggestions of Ricardo Semler, a celebrated business role model, who firmly believes in workplace democracy.

It is not just the stuff of management theory either. These ideas have been put into practice at Semler's Brazilian firm, Semco, with a great deal of success.

Within a decade, revenues at the Sao Paulo-based manufacturing and service conglomerate have climbed by 700 percent and the firm now has a turnover of $200 million and employs 3,000 people.

Semler's accomplishments are all the more significant when considered against the backdrop of the erratic Brazilian economy during this period.

"Growth and profit are a product of how people work together," Ricardo Semler told CNN.

"I am not interested in...making sure that you (the employee) are here, that you are giving us so many hours a day. We need people who will deliver a final result."

Semler has purged his firm of what he calls "corporate oppression," including time clocks, dress codes, privileged office spaces and perks for top executives.

Collective decision-making is down to a fine art at Semco. Worker committees run the manufacturing plants and profit-sharing schemes are available to all staff members.

"If we do not let people do things the way they do, we will never know what they are really capable of and they will just follow our boarding school rules," Semler explains.

At Semco, employees also have unrestricted access to all corporate records; they set their own wages -- which are posted on the company's Intranet -- and workers review their managers anonymously every six months.

"If you look at any kind of modern organization and you think -- what are the foremost tools of power? You will find that it is information," says Semler, who is also the publisher of two books.

Yet some experts think that the management guru's ideas cannot be applied to all businesses, of all sizes around the globe.

"I do not believe (his ideas) would work in large companies, such as in a public limited company for example," says Ian Angell, Professor of Information Systems at the London School of Economics.

"The idea of saying we all sit together and agree to share the profit is highly problematic because different groups of people will demand a bigger slice of the pie."

However, a number of Semler's principles have filtered their way into the conventional wisdom of management-employee interaction.

"(Semler's ideas have) sort of seeped into the establishment," says Tom Stewart of the Harvard Business Review.

"They have not taken it over, but the established -- more hierarchical, perhaps more formal -- organizations have adjusted to a kind of world that has changed and that he saw changing fast."

CNN's Andrew Carey contributed to this report

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