Let's imagine, for all intensive purposes, that it became known that you can make money by running long distances. Now suppose that to make this money you organized two groups.
The first group was told to come in at 6:00 AM and leave at 9:00 AM and they had to ask when they wanted to go to the bathroom. In addition, they were told that all of the profit would be managed by someone that would be brought in. He would keep track of the money and pay everyone exactly the same (so that everything was fair) and he would keep the rest of the money for himself. Also, he would make sure that they clocked in at exactly 6:00 AM and left no earlier than 9:00 AM. He would also make sure they were all running fast enough and not cutting corners. You can probably see where this is going.
The second group decided they would run 3 hours a day. Together they decided to run in groups of at least 7 to encourage team work and safety. Group leaders, hirings, and firings were all decided by secret votes of the group members. In addition, each person chose his/her own salary based on needs and desires and obviously...peer pressure.
Which group do you think would create the biggest profits? Which group would have the happiest runners? Which group would be more creative and innovative?
You may also be thinking what I thought the first time I heard of the idea...If everyone chooses their own salary, wouldn't everyone choose the highest salary they could get and work the least they can? The truth is, a company called Semco, which has over 5,000 employees, revenues of more than $1 Billion, and is one of the fastest growing companies in Brazil does exactly this. Ricardo Semler's (CEO of Semco) employees choose their own wages and work whenever they want to. Wouldn't you like to have that kind of boss? What is his secret? The secret is that he doesn't act like a boss. Ricardo Semler doesn't even have the power to fire an employee. There are only three levels of management and he treats his employees like adults and not adolescents. Novel idea? No...common sense.