Wednesday, December 3, 2008

Capitalism in the Workplace

Plot of S&P Composite Real Price Index, Earnin...Image via WikipediaA bit more on the compensation end of what I spoke of.

I would love to see people derive a large part of their compensation from revenue from the projects they've worked on. Employees could be given a percentage of the project's profits (shares) in exchange for not getting part of their salary.

If a project fails, employees would lose money too.

But what if employees could buy and sell those shares of the project's future revenue (or some amount of money earned by success) in an internal market? A stock price for all your projects would give you a pretty good idea of what employees working on the project really think.

What could be more valuable? Believe me, employees will not be blowing sunshine you know where when their own money is at stake.

I'd also make it so everybody could select what projects to work on and could leave them if they decided another project would be more profitable. By having some skin in the game and being able to act in their own interests, employees would be helping make decisions about where the company can most profitably deploy its capital.

Can't get on a project? Maybe you need some skills development or a course in manners. The company can offer a coach that gets his extra compensation only when you're on projects that succeed.

Still can't get someone to pick you for your team? Well maybe your base compensation starts declining gradually until you change that situation or decide another easier company is right for you.

I think such an approach would make everyone in the organization tune in to what really matters. High value opportunities, revenue-rich markets, eliminating effort wherever it doesn't create value. And everyone would be selling themselves, selling others on opportunities and selling to the world.
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