BUS102 Management and Leadership: Ricardo Semler Case Study Analysis

This report examines the leadership style of Ricardo Semler, the owner of Semco, focusing on his Laissez-faire approach. It analyzes the advantages and disadvantages of this leadership style, highlighting how it fosters employee freedom, motivation, and organizational efficiency. The report addresses how Semler's leadership influences teams to achieve goals, emphasizing qualities like communication, motivation, and honesty. It also discusses the extent to which Semco's work practices contribute to efficiency, and what other leaders can learn from Semler's approach. The report explores the impact of this leadership style on the company's performance and provides insights into applying these principles in different business contexts. The study references various leadership theories and academic research to support its findings, providing a comprehensive analysis of Semler's innovative management techniques and their practical implications.

Running Head: BUS102 Management and Leadership
BUS102 MANAGEMENT AND LEADERSHIP

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BUS102 Management and Leadership
Executive summary
This study has focused on the case study of Ricardo Semler, the owner of Semco.
From the case study, it has been found that this person is following the Laissez-faire
leadership style and this company provides full freedom to its employees. Based on this case
study, four questions have been answered. The answer to the first question has mentioned that
Ricardo has chosen the Laissez-faire leadership approach for his business and it has helped
him to achieve business goals within the minimum time and budget. This answer includes
both the benefits and drawbacks of this leadership approach. On the other hand, this answer
has included a total of 3 leadership styles, their benefits, and drawbacks.
The answer to the second question has included proof of Laissez-faire leadership from
the case study. It has mentioned all the qualities of a good leader that can motivate
employees. Through answering the third question of this assignment, the meaning of
efficiency and effectiveness and their importance within an organization have been discussed.
Besides, the way of achieving goals by Semco has been included. The answer to the fourth
question has mentioned about what other leaders can learn from the case study of Ricardo
Semler and the impact of this learning in business.

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Table of Contents
1. Advantages and disadvantages of the leadership style of Ricardo Semler............................4
2. Influencing team to achieve organizational goals..................................................................5
3. Extend of gearing up of the work-practice at the organization of Ricardo Semler towards
efficiency....................................................................................................................................6
4. Learning from the leadership approach of Ricardo Semler...................................................8
Reference list............................................................................................................................10

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1. Advantages and disadvantages of the leadership style of Ricardo Semler
Leadership can be defined as the art of motivating a group of people for acting
towards obtaining a common objective. As stated by Paoletti, Reyes & Salas (2019), in a
business setting, leadership means guiding colleagues and workers with a proper strategy for
achieving organizational requirements. There are three main types of leadership, which
include autocratic, participative and laissez-faire leadership. The autocratic leadership style
has become a relic in the current business environment. This is because most of the
employees perform better without the presence of their supervisors all the time. This
leadership style creates extreme pressure on employees, which can impact their performance.
A participative leadership style is a good approach that allows managers to give proper
space to employees to show their creativity independently. However, still, managers maintain
enough control by guiding the overall vision of the team and providing them feedback.
Laissez-faire leadership style is a delegative approach, where leaders are hands-off. As
stated by Wong & Giessner (2018), in laissez-faire leadership, managers of a firm allow
members of a group to make their own decisions freely. Leaders provide very little guidance
and followers often achieve complete freedom. However, leaders provide the required
assistance and resources to the team members. The advantages of this leadership style include
highly motivated teams with good skills and high expertise who can work freely. On the other
hand, creative teams can give value to the independence that they achieve. Moreover, this
leadership style works well, if the leader provides necessary resources at the start of any
project. Among the disadvantages, confusion regarding roles in a group is essential. Besides,
leaders can get uninvolved and this can result in poor performance.
In the case study, it can be seen that Semler believes that the organization thrives well
by entrusting staff. The employees of this company decide their working hours and pay
levels. Moreover, they decide who will be their boss and their performance. The workers of

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this company use their skills and common sense to make decisions by aligning with company
goals. Semco has got an advantage for this style of leadership, which includes increasing
flexibility in the work environment. Workers of this company can maintain work-life balance
properly, which can help to increase their satisfaction rate. Moreover, the creativity and skills
of employees can bloom through this style of leadership as they can make decisions freely. It
is mentioned in the case study that in spite of the failure of other Brazilian companies and
banks, this firm has survived. On the contrary, among the disadvantages, fewer policies and
rules can deteriorate the discipline of the company, which can impact on the reputation of
Semco. In addition, leaders and managers can lose control over the employees due to less
involvement in operational procedures. Moreover, investors can also lose trust in the future
because in the case study, it is stated that this firm has no long term plans, organization
charts, and others. This can increase confusion and trust issues among external shareholders.
2. Influencing team to achieve organizational goals
An effective leader is an individual who has a passion for a cause, which is larger
than they are. There are some qualities of effective leaders, which includes the ability of
communication effectively Fiaz, Su & Saqib (2017). Moreover, they can set goals and focus
on specific tasks with good skills in problem-solving. Effective leaders are able to delegate
properly and foster trust and confidence in a team. In a good leader, there are some qualities
that include communication. Until a leader communicates the vision to the team and describes
the strategy, it will be difficult for employees to work. As stated by Wong & Giessner (2018),
good communicator is able to become a good leader because words have the power to
influence and motivate people. Another quality of a good leader is motivating others. It is the
most difficult task for a leader to persuade followers to follow. It can be done if the leader
inspires them by setting a proper example. A good leader stays calm and composed during
any harsh situation and motivates others that help to overcome the challenge. Moreover, the

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skill of motivation is essential to improve and maintain the performance of employees that
can be done by providing feedback and recognition of efforts. Other qualities of a good leader
include honesty. An honest leader is able to gain the loyalty of subordinates and improves
transparency in a work team (Baker, 2019). A leader generally achieves success, if they stick
to their core beliefs and values including honesty. Without proper ethics and honesty, a leader
cannot achieve the trust of the subordinates. Confidence is another essential quality, which
helps the leader to make proper decisions and gain the trust of followers. Commitment and
passion is another essential quality of a good leader. This is because when the subordinates
will see their leader's hands dirty, they will also give their best efforts.
Ricardo Semler as a leader has influenced his team by taking a hands-off approach.
This means that he has allowed subordinates to make their own decisions and create their
own objective that aligns with organizational goals. He believes in treating employees as
adults so they can respond like an adult. As said by Muteswa (2016), leaders sometimes
inspire their team by only providing support and not pushing them in a definite direction. In
Semco, Semler has given full opportunity to the staff to create their own objectives, select
their own boss by accessing their performance. Moreover, additional stress is not created by
preparing an organizational chart, working hours and harsh policies. This has motivated
employees to gain organizational goals by adopting their own path. On the other hand, the
company's new strategic initiatives and the election of corporate leadership are also
controlled by employees. This helps to increase their engagement with the company's
operational procedures and increase their belongingness to the firm. Ricardo Semler believes
that the common sense of employees and their knowledge is enough to hit the organizational
goals.
3. Extend of gearing up of the work-practice at the organization of Ricardo Semler
towards efficiency

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The efficiency of a company allows the owners to deliver the service or products
within minimum time and cost. As defined by Kuznetsova et al. (2017), the efficiency of an
organization refers to the ability to be accountable and provides health as well as a safe
working environment for the employees. It is important to maintain efficiency to improve
internal business communication. On the other hand, if a company ensures efficiency, it is
possible for leaders of that company to motivate employees and help them by giving every
required facility to achieve business goals. However, Olshanskiy, Selutin & Barry (2017)
have mentioned that the effectiveness of a company refers to the result after completing a
task by the collaborative approach of managers and employees. It can be stated that a
company needs to assess the performance of both employees and leaders on a regular basis to
ensure effectiveness. According to the contingency theory of leadership, the effectiveness of
a company depends upon matching the leadership style with different business situations. It is
important for a company to ensure effectiveness by providing training to employees and
providing the required resources to them. Rashidi (2018) has mentioned that this approach
can help the company to increase the level of customer satisfaction and a good brand image
can be maintained.
From the case study, it has been found that Ricardo Semler has given full freedom to
their employees. Employees of Semco get required facilities from the end of the company
and they are free to select their job role, pay scale, leaders and working hours. Additionally,
they have the opportunity to review the performance of their bosses and they are free to be
engaged in the decision-making process of the company. As opined by Rafiq, Haris, Anwar
& Majeed (2017), this kind of leadership motivates employees to become efficient and
deliver their best performance within the organization. According to the founder of this
company, employees must have all the freedom in the workplace so that they can give their
best effort. The political and economic condition of Brazil has been changed rapidly and the

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company of Ricardo Semler has survived successfully because of his unique leadership
approach. As mentioned by Rashidi (2018), this aspect is proof of the efficiency and
effectiveness of this company. The owner has successfully improved the business
performance with the help of their loyal and efficient employees. As per the statistics, this
company has grown by nearly 27.5% on average in a year for approximately 14 years.
The in-charge of the manufacturing department of this company has mentioned that
employees of this company are aware of the business goal and they believe that the
employees know the appropriate process to achieve those goals. According to Olshanskiy,
Selutin & Barry (2017), radical leadership approaches help the leaders to influence the
employees to become flexible to different situational changes. This approach has been
followed by Semco and it has helped them to survive the roller-coaster nature of the political
and economic condition of Brazil.
4. Learning from the leadership approach of Ricardo Semler
According to radical leaders, innovation means thinking in a different way within a
positive working environment. It can be learned from the laissez-faire leadership style of
Ricardo Semler that a leader must give full freedom to employees to encourage them to think
innovatively. For example, the management of the Blue Mountain Hotel management school
needs to learn this approach from Ricardo to provide the right environment to their staff. This
kind of leader thinks that employee motivation can be ensured by providing the freedom to
employees. Baker (2019) has mentioned that freedom to work according to one's own choice
acts as a motivator and it is possible to motivate employees through this approach. It can be
learned that providing less guidance to employees can help them to become flexible to
different situational changes. However, it is important for leaders to trust the ability of
employees to give them the freedom of choosing their job role, pay scale, working hours and
leaders.

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From the case study of Semco, it can be learned that leaders must invest time and cost
in arranging the required resources for the business. According to Muteswa (2016), if
employees get advanced technology and other required resources, they will be able to
perform well. It can be learned from Ricardo that providing a good working environment to
the employees helps to get the support from employees to achieve business goals.
Semler has been able to achieve employee commitment by involving them in essential
operational issues like the election of organizational leadership and taking strategic
initiatives. This has helped to encourage the creativity of employees and yielded high job
satisfaction. Semler's leadership style has helped to mitigate different workplace issues like
skills drainage and conflict between employees. Moreover, the leadership style adopted by
this leader of the Semco group has provided flexibility in work. Employees have no fixed
working hours or they are not bound to follow any rules. This occupational freedom is very
essential and significant to gain success in business that Semco has achieved. It has also been
understood that the laissez-faire leadership style has also increased the participation level of
employees. This is because they gain minimal or no guidance from their supervisors. They set
their own goals by aligning with organizational objectives and managing their own
performance. Moreover, essential decisions like strategic innovation, the election of
leadership are also done by them, which increase their participation. This leadership style is
very much suitable for new leaders managing an experienced team. The new leader can adopt
this style to wait and view the whole scenario. As opined by Rafiq et al. (2017), in a laissez-
faire leadership style, the leaders need to make it clear that they are available for any advice
or during the requirement of resources. This is essential to maintain the performance of
employees. This leadership style is also suitable for those employees who love to work alone.
However, in the future, leaders of this firm can lose control over employees and any change
in leadership can raise conflict among employees.

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Reference list
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