SEMCO

Organizational Design

Networked structure: contracts underlie organizing

• Effective in minimizing bureaucratic costs
• Market-based allocation mechanism
• Another structural feature – Skunk works – NTI
– Similar to communities of practices

• Consider principles of OD in Semco:

 Formalization or Mutual Adjustment
 Centralized versus Decentralized
 Differentiation and Integration
Alternative • Questions the value of growth

Design • Global war for ‘talent’

• Control?
• “Own the capital”, not the company
• Capital in the service of labour; Not
labor in the service of capital
• Factory Floor Flexi-time
• Self-Set Salaries
• Rotating CEO-ship
• Three levels of hierarchy
Strong Culture at Semco? • Importance of connect between
assumptions, values, and artifacts
– What we say is what we do
– Do the artifacts reflect the basic
assumptions
• Implications for companies that adopt
practices without altering basic
assumptions
– Institutionalization and socialization?
• E.g. people who misused trust systems
were let go
• E.g. Marine division lost out on
competitive bid?
• Role of the leader/ founder ?
 Case Takeaways: Culture
and Structure

Differentiation 4 Departments
Artifacts Profit-sharing Profit-sharing Versus and Counselors
(often structural Factory Floor Flexi- Self-Set salaries Integration
elements) time Rotating CEO-ship
Open IS

Decentralization Flexi-time, Profit-

versus sharing versus
Centralization budgeting

Values Treat employees Participative

like adults management
Formalization Open IS,
versus Mutual Participative
Adjustment Management

Assumptions Employees will not take advantage (trust)

All people desire to achieve excellence
How do we measure Organizational Effectiveness?
 What are the conditions that
lead to such organizations
being successful?
• Creating Culture
– Founder characteristics
– Capacity building/ Training of all employees
• Managing Culture:
– Socialization of new hires
• Key assumption – employees are adults, employees are trustworthy
• Reward systems; Appraisals
• Organizational Design: structure and Culture is aligned:
– Sufficient flow of information; coordination mechanisms in place
 SIMILAR
ALTERNATIVES
• Morning Star – US
• Greek Solidarity Initiatives
• Worker Co-operatives in Brazil : Post-Capitalist
Alternatives
• Mondragon: Spain : Capital in the Service of Labor
instead of Labor in the service of capital
• Communes in Venezuela
• Burning Man Festival
• Community-Based Palliative Care – Kerala
BURNING MAN
FESTIVAL,
NEVADA
SAMITI -
IIT
KANPUR
URALUNGAL
LABOUR
CONTRACT
COOPERATIVE
SOCIETY - 1925
 #Community organizations #Diseases
(Scale propagation) (Scope propagation)

250 10

Chronic Renal
200 8
Mental Illnesses;
Geriatrics

150 Chronic 6
respiratory
HIV/AIDS
100 4
Cardiovascular
conditions
Bedridden, Paraplegic
50 2
Terminal Cancer

0 0
1993 1998 2004 2008 2012
Creation of Community
Organization, Nilambur

Propagation of the
Doctor-Driven Satellite Community form
Clinics

Emergence of the Community

form
Kerala Community Based Organizations
• Vijay, D., & Monin, P. (2018). Poisedness for social innovation: The genesis and propagation of
community-based palliative care in Kerala (India). M@ n@ gement, 21(4), 1329-1356.
• Vijay, D., & Kulkarni, M. (2012). Frame changes in social movements: a case study. Public
Management Review, 14(6), 747-770.