1. Identify possible sources of tension within the existing structure at Semco?
2. What were the biggest risks taken by Richard Semler in implementing the new regime at Semco?
3. Organisational culture plays a vital role for the successful outcomes of the goals and objectives of every organisation. The management of the organisation sets the strategies for achievement of the goals and objectives of the organisation. The goals and objectives of the organisation are reflected in the vision and mission statements of the organisation. For the successful achievement of the goals, the management formulates strategies. In order to work as per the strategies, the organisation sets appropriate organisational culture. The culture of the organisation refers to the set of principles, ideas and the values that are followed by both the leaders and followers of the organisation in order to achieve the goals of the organisation (Emmanuel & lHarris, 2000). The leaders and the followers of the organisation work in a similar way for the success.
In the present competitive world, there has been immediate need of the change in the culture of the organisation. The change is inevitable and it never remains constant. This has been changed as per the demand of the market and the competitive environment. The company makes changes to survive and sustain its business in the competitive atmosphere. Thus the role of the leader is very important here. The changes in the culture are only possible only when the leaders lead the followers in the right direction (Warner, 2010). The leaders need to make the employees of the organisation realise that change is inevitable and the followers should accept this. Without the contribution of the employees the changes cannot be achieved.
In the present case study, this has been observed that Richard Semler has been a transformational leader who has contributed to the change in the culture of the organisation, expecting the urgent need of the change to sustain in the competitive environment. He is described as a transformational leader who acts in a transparent way and becomes an example to the employees of the organisation. All the changes initiated by the leader require to be followed by the employees of the organisation. It is because of the immediate change the followers of the organisation get confused. Accepting the new change cannot be effective as the employees are tuned with the old culture. They are required to be inspired and they need to know the need of the change.
In the case study organisation the first possible tension is related to the acceptance of the new changes in the organisation. The leader has changed the culture of the organisation immediately. Earlier the top management of the organisation was responsible for formulating the strategies of the organisation and the employees were just following them. But in the present situation, Semler advocated for self motivated working style. These types of strategies have never been followed earlier. The employees may or may not be effective in taking the decision as they have never tuned to this (Zhu, 2004).
The second important tension to the system is the change of the structure of the organisation. In the previous pattern of the structure of the organisation, there was top level management. The hierarchical management structure was following the leader as a patriarchal figure. The followers of the organisation were expecting the culture to be framed by the leaders. The rules and regulations of the organisation were predetermined by the management. Thus the changes will bring immediate trouble in the operation of the organisation (Parikh & Kollan, 2005).
The empowerment strategy of the organisation was also a tension for the company. The employees were given much freedom to take part in the strategies. But success of the company was under threat.
The middle managers of the company left their jobs within a year of the implementation of new strategies. The new employees were told that they undermined the old managers. The new people could be a threat to the company as they did not have idea about the culture and the trend of the company (Heracleous, 2003).
The next important tension was related to the leader itself. As the changes were made immediately and he focused on empowering the employees, he had to take all the responsibilities to work for the successful change in the culture. This also caused illness to Semler.
4. The greatest risks taken by Richard Semler are the changes in the culture of the organisation. The company is very old and the culture of the organisation has been established successfully earlier. The new and immediate change is nothing but a great risk for Semler. The culture of the organisation is changed when the organisation goes through some difficult phases. These difficulties should be sensed by both the leaders and followers of the organisation. The employees should know that there is an urgent need of the change in the culture of the organisation, as there is a need for it. If the employees do not feel the need, change will be ineffective (Schein, 1990).
The second important risk taken by Semler is to change the structure of the organisation. The case study organisation has a hierarchical structure and the leader, Antonio was accepted by the employees as their leaders. The top level management was given the task of formulating strategies for the company. The top level officials of the company were taking risks and managing the firm as per the need of the business. The goals and objectives were set as per the demand of the business. The change in the structure of the organisation affects the operation of the company. The coordination and cooperation among the departments of the organisation may get disturbed and the outcomes may not be achieved (Strauss, 2005).
The third risk taken by Semler is empowering the employees to take decisions in the process of the operation of the company. Semler wanted to run the organisation by empowering the employees to take part in the decision making process. But the risk is that in an organisation there are different people with different cultural background and intelligence level. All employees must want to impose their values and experiences in the process of decision making. This will create problem for formulating strategies and taking decision for the company. Thus this may be a risk for the leader of the company (Sinha & Kanungo, 2004).
The leader of the organisation has also made a plan to encourage the employees to be self motivated. But this has been found in the case study organisation that the middle line managers have left the jobs due to the ill treatment they received from the employees. They felt neglected and they wanted to relinquish from the organisation. This was a loss and risk to the organisation as the old and experienced people left the organisation (Amsa, 1986).
The motivation is also an important factor for the success of the organisation. The leaders of the organisation should know the need and expectations of the employees. The needs and expectation of the employees differ from individual to individual. Thus motivation is only possible by the leaders only. The leaders should set an example and understand the expectation of the employees. As the culture of the organisation changes, the expectations of the workers also get changed. If the employees are not motivated then it will create trouble to the leader of the organisation in the future (Nelson & Gopalan, 2003). Thus the leader has to be very careful in motivating the employees. The next important risk was that the job design was not made. The work and structure of the work schedule were not made. This will create a threat as no work and time frame is there for the employees. The employees may not contribute to the organisation sincerely.
Amsa, P., 1986. Organisational Culture and work group behaviour; An Empirical Study. Journal of management Studies, 23(3), pp. 347-362.
Emmanuel, O. & lHarris, L. H., 2000. Leadership style, organisational culture and performance:Evidence from UK companies. International Journal of HR management, Volume 11, pp. 770-778.
Heracleous, L., 2003. Strategy and Organization: Realizing Strategic Management. [Online]
Available at: https://books.google.co.in/books?isbn=0521011949
Nelson, R. & Gopalan, S., 2003. Do Organisational cultures replicate National Culture? Isomorphism rejection and reciprocal opposition in the corporate values of three countries.. Organisational Studies, 24(7).
Parikh, I. J. & Kollan, B., 2005. Managerial Roles and Interfaces: Some Organisational Issues and Implications through thematic appreception test,Working paper No.2005-08-06, Ahmedabad: Indian Institute of Management.
Schein, E., 1990. Organisational Culture. American Psychologist, Volume 4, pp. 109-119.
Sinha, J. B. & Kanungo, R. N., 2004. Context sensitivity and balancing in Indian organisational behaviour. International Journal Psychology, Volume 8, pp. 93-105.
Strauss, G., 2005. Organizational development: Credits and debits – ScienceDirect. [Online]
Available at: www.sciencedirect.com/science/article/pii/S0090261673800142
Warner, A., 2010. Strategic analysis and choice. Nw York: Business Expert Press.
Zhu, Z., 2004. knowledge Management: Towards a universaal cocept or cross cultural context?. Knowledge Management Research and Practice, Volume 2, pp. 67-79.
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