Editorial: April 2004

It’s hard to imagine two more different business leaders than Bernie Ebbers and Ricardo Semler. Ebbers, former bouncer, former telecom billionaire and—until recently—former unindicted chairman of WorldCom, liked to claim he was an “aw-shucks” kind of guy. His self-described talent for business consisted in his ability to bring people together, then trust and encourage them to do their thing—he’s also a former high-school basketball coach. But his hands-off management style belies the high-pressure culture he created at WorldCom, where frenzied dealmaking and attention to Wall Street earnings expectations were paramount, especially, it’s alleged, when the value of Ebbers’ stake in the company was in danger. That, it’s also alleged, was the reason behind the $11 billion accounting fraud that led to Ebbers’ demise, and WorldCom’s bankruptcy.

Ricardo Semler, on the other hand, inherited his father’s firm, a small manufacturer of marine supplies called Semco, over two decades ago, and he immediately set out to transform the Brazilian company into a kind of workers’ paradise on earth. In the past six years alone, his company has grown from $35 million in revenues to $212 million, partly on the strength of his “he who manages least manages best” style. Semler’s management watchword is trust, and he appears to mean what he says. He trusts his employees to work when they want to, to set their own salaries, to attend meetings only if they think they need to, to buy themselves the technology they need, and to read and understand the detailed company financials he regularly sends to every employee. The result, in addition to Semco’s stellar growth: a fiercely loyal workforce who appear to have flourished under Semler’s management style.

Like their leaders, MCI and Semco are very different companies. Like every organization of any size, however, both of them are driven by information technology. And information technology, depending on how it is used throughout a business, has the potential to instill confidence or create suspicion among employees. It all comes down to trust. Do you use software to read employees’ e-mail—or do you write your own software to prevent it, as Semco did? Do you view instant messaging as a threat to corporate IT, or as a communications tool that can be turned into a business advantage? The choice is up to you.