BOOKS: Farewell to blue Mondays

BOOKS: Farewell to blue Mondays - The Seven-Day Weekend; By Ricardo Semler; Century; pounds 16.99

by Sir Rocco Forte, chairman of Rocco Forte Hotels
Last Updated: 31 Aug 2010

The Seven-Day Weekend; By Ricardo Semler; Century; pounds 16.99

The Semco boss's account of his company's ultra-liberal culture is persuasive, says Rocco Forte, even if his ideas couldn't possibly work for most businesses.

Conventional business practices are thrown out of the window. No strategy, no five-year plans, no formal budgeting, no monitoring or control of the workforce. Democracy in the workplace, shop-floor workers making investment and hiring decisions. And it works: dollars 100,000 invested in Semco 20 years ago is worth dollars 5.4 million today. Ricardo Semler, head of the firm that he inherited from his father, has transformed it into a business employing 3,000 staff across three countries.

The Seven-Day Weekend challenges conventional approaches to work. Semco's company culture encourages time off during the working week - 'If people can answer e-mails on a Sunday, why can't they go to the cinema on a Monday afternoon?'

Expansion and growth is not channelled in any particular direction, Semler explains, but is encouraged to emerge from existing business activities.

Execs can follow hunches, develop offshoots in similar areas of business or use existing skills to develop new businesses.

This is all very well. It is clearly the way Semler wants to run his firm. His passion seems to be the system of management itself rather than the actual business.

Where he goes wrong is in extrapolating this approach to all businesses and in thinking this is the only way for businesses to achieve sustainable success. Semler is dismissive of a number of global brands, citing those that have disappeared or have fallen on difficult times.

His company has been going for 25 years in its present format; some of the companies he dismisses had more than 100 years of success before floundering.

I think he underestimates his own impact on his business and maybe the next generation of management will not be as successful as he has been in making his system work.

There are plenty of positive aspects to what he preaches, some of which have been adopted in businesses with a more classical and less democratic structure. Semler has a hatred of bureaucracy, which will eventually slow down any business once it reaches a certain size. He avoids this by having a large number of independently run enterprises where the decision-makers are close to the action.

Yet many great businesses that have sustained success could never have evolved using Semler's approach. Sometimes a certain single-mindedness and strict control of the product line is essential in developing successful products, particularly within the service industries.

It is true that the old militaristic approach to management is no longer apt. In most advanced Western countries with low unemployment, people can choose where they work. Employees work for you because they want to, not because you make them. A more informal approach to management is required and the style must be participative. People want to know why they are being asked to do things, and they appreciate the opportunity to raise suggestions and be involved in decision-making.

This does not mean that control of major decisions must be relinquished by those at the top. If you employ good people, they should have space to use their skills and find their own solutions to problems. But some solutions developed within the business become a way of doing things and it is not necessary to keep reinventing them.

My business aim has been to develop a luxury hotel group in Europe. No com pany at present is offering any significant coverage of the main European centres.

I must have the same basic standards in all the hotels if the customer is to get a consistent product. There is no way of achieving even first base by using Semler's approach. It is only with single-mindedness that I can develop the required product. Success is measured by the number of customers who agree with me.

Part of the process is recreating my own passion for the product in the people who work in my organisation. This is a mixture of giving direction and allowing people to express themselves within a given framework. It is not a free-for-all.

The book is interesting because it is controversial. It sparks ideas that can be applied to one's own business. It is unlikely to convert many, but it will certainly encourage managers to look very carefully at their management practices.

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