Who dunnit differently – remuneration and incentives

The one who wins is the one who dies with the most toys, right? The happiest employee is the one who is paid the most? Hmmm… Far be it from me to say no to these attractive options, but what if you became an owner when you started at your new job. Or if you only had to work 4 days a week or if you could go on early retirement…

So, let’s look at the different kinds of carrots out there…
At Fog Creek they did some research and found out that most people think they do a pretty decent job so performance reviews are generally useless. So, management rate the performance of their employees and pay is adjusted according to their findings. There are some cool benefits for the employees including:
  • Vacation (sure glad they didn’t leave that out)
  • Training
  • Medical aid
  • Health club membership (that’s more like it)
  • Free internet access from home (now we’re talking!)
  • Paid for professional subscriptions
At 37signals they found people worked harder and were happier on a Monday when you gave them a four day week!

At Semco the motivation behind the company’s existence was happy employees and happy customers. Here employees determine their own working hours and salaries (the mind boggles). Employees hire and rate their bosses and they can go on early retirement which means that they have one day a week off, that they have to work in after they go on retirement.
At John Lewis Partnership you get to own part of the company when you start working there (along with 70 000 others). The whole purpose of the business has been the sharing of
  • profit
  • knowledge
  • and power
Some incentives for employees are
  • Profit sharing
  • You buy anything in the store at cost
  • A sabbatical of 6 months after 25 years of service
  • Education
  • Club membership
At Netflix they have a simple remuneration philosophy to attract the best employees: They pay the best salaries. What makes this different? The fact that they consciously go out to do it.
A penny for your thoughts?


  1. Sep 7, 2010
    3:34 pm


    I believe the above examples are true, but they are only part of the truth, they are cosmetic and will deliver results for a short period of time. Then other issues play a role such as real happiness. This comes from within and can only be fostered by the individual himself. Part (the part that the employer can control) of contributing to this happiness is cosmetics such as the above, BUT also his management style and strong leadership. Many leaders do not know the difference between leadership and management. Some have an idea, but never investigate to check if they actually comply. To illustrate, John C. Lewis writes:" Most employees do not resign from the company, but they resign from employer/manager."
    Salaries and incentives are hardly ever the most important reasons why employees resign, but skills development, employer relationships and growth opportunities are always listed at the top. For the same reason I believe it will aslo not lead to constant ispiration in the work place.
    I believe a manager/leader must understand the art of verbal communication and motivation. They must understand what makes the 20% of the employees that deliver 80% of the results tick. What do they need to energise them? What do they need for inspiration to come up with new ideas???!!!!
    This can only come from the manager/leader. Employees need constant inputs from the top to keep them inspired and innovative.
    Example of a CEO that understands this is Bryan Dyson-former CEO of Coca Cola. In his address to his top management he said:"Imagine life as a game in which you are juggling some five balls in the air. They areWORK, FAMILY, HEALTH, FRIENDS AND SPIRIT, and you are keeping all of these balls in the air. You will soon understand that WORK is a rubber ball. If you drop it, it will bounce back. But the other four balls are made of glass. If you drop one of these; they will be irrevocably damaged, marked, nicked, or shattered. They will never be the same. You must understand that and strive for it. Work efficiently during office hours and leave on time. Give the required time to your family, friends and have a proper rest. VALUE HAS A VALUE ONLY IF ITS VALUE IS VALUED."
    This is fantastic, thoughts of a man that understands life in the wider context outside incentives such as money, time off, etc.
    The type of cosmetics that employees need will be determined by the management and leadrship style.

  2. Sep 7, 2010
    4:49 pm


    I've battled with the "20% of the employees that deliver 80% of the results tick" concept over the last couple of years. Is this just something you have to settle with or can you say that all employees should contribute to the results … just a thought.

  3. Sep 10, 2010
    9:35 am


    Hi Walther. Yes all employees should in principal contribute evenly. This is as you know, hardly ever possible. I agree with you that it won’t be possible to have equal contribution by all employees. But John C. Maxwell is of the opinion that you should invest 80% of your resources and time in the top 20% and then have that 20% train and inspire the next best 20%. One should bear in mind that the other 80% also contribute to the success of the Co in their own way, but should not be entitled to the lion share of your time and resources. One very often find that the weak links in the Co utilize a lion share of your time.

  4. Sep 28, 2010
    3:25 pm


    I know paring is good for the systems we write; but my word – working from home with the company paying for your ADSL line is just GREAT!… I love it!!!

  5. Oct 7, 2010
    8:42 am


    Stop bragging Liliana!

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