In the early stages of his leadership journey, Ricardo Semler, the CEO of Semco SA, initially embraced a conventional authoritarian leadership approach characterized by top-down decision-making and rigid hierarchical structures. This initial method aligned with theories like Trait Theory, suggesting that effective leadership is an innate quality, and the Great Man Theory, which highlights the significance of exceptional individuals in leadership roles. During this phase, Semler's leadership style prioritized control, efficiency, and adherence to conventional business norms.

One clear example of Semler's early leadership approach was his steadfast commitment to traditional organizational structures and procedures. Inheriting Semco SA from his father, Semler maintained a hierarchical management system where decisions were made by top executives and cascaded downward through the organization. This approach resonates with McGregor's Theory X, which assumes that employees are inherently unmotivated and require close supervision.

Moreover, Semler's leadership style in the early days was marked by centralized decision-making, where he held the authority to make critical strategic decisions with minimal input from employees. This autocratic approach was evident in Semco's operations, where Semler tightly controlled various aspects of the business, including production processes and employee schedules. This leadership style reflects the principles of Transactional Leadership theory, which emphasizes leader-follower exchanges based on rewards and penalties.