University Case Study: BBMM303 Semco Analysis of HR Practices

This case study analysis examines Semco's evolution, focusing on its HR practices and organizational structure. Initially, Semco operated under a hierarchical structure with authoritarian leadership. The analysis highlights the company's transformation under Ricardo Semler, who implemented significant changes in HR practices, leadership styles, and strategic focus. The study explores the shift from rigid control to employee empowerment, flexible work arrangements, and a focus on employee well-being. It discusses the areas of problem, including employee loyalty, stressful work environments, and lack of transparency, and contrasts them with the implemented solutions. The analysis incorporates relevant theories like authoritarian leadership and different organizational structures (functional, divisional, matrix, and flatarchy) to explain the changes. Finally, the case study provides recommendations for fostering a positive organizational culture, improving communication, and staying up-to-date with best HR practices.

HR Practices and
Organizational
Structure
Semco Case Study

Introduction
The presentation will discuss:
– The Background of Semco
– Situational Analysis
– Description of the Areas of Problem
– HR Practices
– Leadership
– Strategic Focus
– Supporting theories
– Recommendations

The Background of Semco
– Semco was established in Brazil in 1953
– Austrian Immigrant Antonio Curt Semler founded the company
– Since then the company offers marine pumps as manufacturers
– 90% of the companies products were supplied to Brazilian ship makers
– The company was hierarchy based and was governed by various policies.

Situational Analysis
– The company was experiencing financial distress in 1982.
– The company was taken over by Ricardo Semler, that year
– Semler was appointed as the CEO of the company
– He focused on improving the financial capabilities of the company.
– Authoritarian approach was adopted by the CEO, creating pressure and
mounting stress.
– Appointed managers pushed employees
– Thus, building unfavorable culture

Situational Analysis
– New employee appointment were being made in the company
– Loyal employees were being laid off.
– Semler himself, various managers and employees had to put in long hours at
work
– There was a point that the stress got to Semler and he fainted while touring the
pump factory
– Hence, new approaches were decided to be taken in terms of HRE practices,
Leadership and Strategic Focus

Description of the Areas of
Problem: HR Practices
– HR Practices (Before)
– Employee loyalty not valued
– Uninformed change management
– Stressful shifts
– HR Practices (After)
– Flexible work hours
– Employees evaluated on the basis of target achievement not on the basis of hours
worked.
– Focus on employee wellbeing

Description of the Areas of
Problem: Leadership
– Leadership (Before)
– Lack of empathy
– Rigid leadership and hierarchy
– Authoritarian style leaders appointed
– Leadership (After)
– Leaders of appraised regularly
– Feedback taken from leadership experts
– Leadership positions had to be earned now

Description of the Areas of
Problem: Strategic Focus
– Strategic Focus (Before)
– High Productivity though extra efforts
– Lack of focus on factors such as motivation and organisational culture
– Lack transparency and management focus
– Strategic Focus (After)
– Maintaining transparent operations
– Operations are driven by individuals
– Mutual relationship between management and employees

Supporting theories
Following are the theories that relate to the case
Authoritarian Leadership:
– Authoritarian Leadership is also known as autocratic leadership (Zheng et al. 2019)
– Leadership style in which leaders control all operations and make all decisions (Fiaz, Su and Saqib 2017)
– Judgements made on individual assessment of situations
Organizational Structure:
– Functional: Structure based on functional divisions (Bai et al. 2017)
– Divisional: Structure based on geographical location
– Matrix: Structure developed on the basis of Projects and Functional competencies (Lukinaitė and Sondaitė
2017).
– Flatarchy: Structure that is a characterized by horizonal integration of functional divisions (Aleem et al. 2019)

Recommendations
Following can be recommended:
– Listening the needs of the employees
– Paying importance to organizational culture
– Staying up to date with best HR practices
– Establishing smooth communication framework

REFERENCES
Aleem, S., Batool, R., Ahmed, F. and Khattak, A., 2019, November. Guidelines for Key Organizational Factors
for SaaS Organizations. In Proceedings of the 2019 3rd International Conference on Big Data Research (pp.
83-87).
Bai, W., Feng, Y., Yue, Y. and Feng, L., 2017. Organizational structure, cross-functional integration and
performance of new product development team. Procedia engineering, 174, pp.621-629.
Fiaz, M., Su, Q. and Saqib, A., 2017. Leadership styles and employees' motivation: Perspective from an
emerging economy. The Journal of Developing Areas, 51(4), pp.143-156.
Lukinaitė, E. and Sondaitė, J., 2017. Mindset of employees working in a matrix organizational
structure. Business: Theory and Practice, 18, pp.144-151.
Zheng, Y., Huang, X., Redman, T., Graham, L. and Hu, S., 2019. Deterrence effects: the role of authoritarian
leadership in controlling employee workplace deviance. Management and Organization Review.