Managing Principles

We are aware of the disadvantages of the size. As free-market radicals, we know that the spontaneous order of the market is much more efficient than the central planning of a corporation. Therefore, organizationally we always try to emulate and replicate market-based mechanisms and incentives inside the company. This translates in a few organizational principles that we apply to all our ventures:
a) The profit and loss agents must be as low as possible in the organizational chart. For example, in pharmaceutical retail, each sales point is a business unit, and the manager is evaluated on the results of his/her pharmacy. While some decisions (pricing , lay-out and negotiating with providers, essentially) are centralized, all other decisions are left to manager of the pharmacy, from the level of staffing and inventory, to local advertising, cash management, and recruiting, compensation and firing.
b) We believe that staff positions are essentially parasitic, it is the line that brings home the bacon. We are extremely lean, and all the staff positions must be paid voluntary by the agents of the business units from their P&L. For example, in the entire group we have only one person of human resources.
c) We trust but verify. We leave the business unit managers a lot of leeway, but at the same time we are require timely and precise information. Each business unit has to close the books daily, sending to the center a complete P&L and balance sheet the following day.
d) We are meritocratic. Starting from lower-management positions, 20-30% of salary is variable, based on results and paid monthly. The same applies to career-development: some of the most senior positions, responsible of tens of millions dollars in yearly sales, are covered by high-school drop-outs. We do not care where or what people studied, we just look at their results in the company.