Case: Large Enterprise and Entrepreneurial Spirit
A company has become an unwieldy behemoth. Apathy is rampant, mid-level managers do not understand the front-line business realities, politics have permeated the organization. Top-level management made a decision to change the company culture through gradual adjustment of the compensation model.
- Business-units transitioned to FairShare in the following way:
- Introduce impact-calculation linked to bonus compensation (FairImpact + FairPay).
- After 1 year, size of bonus is tied to business unit performance (FairShare).
- Initially this was deployed at new business units. Eventually a company-wide roll-out ensued.
- Transparent top-down/bottom-up expectation-based performance evaluation.
- Vesting: 2 years
- Divesting: 2 years
- Slimdown: business units slimmed down removing extra/inefficient/duplicate employees.
- Improved Work Ethic: after FairImpact and FairPay were introduced, employees started feeling a sense of obligation towards their peers. After FairShare was introduced, the 9-5 policy was removed, while employees voluntarily, without any directive from management, started putting in more hours when needed with a general improvement in efficiency.
- Improved Attitude towards Management: ability to evaluate their managers and FairShare-driven co-dependence gave employees a feeling that the management is there to support them rather than boss them around.
- Entrepreneurial Behavior: the combination of an improved relationship with management, co-dependence, and ability to profit proportional to business unit performance brought back the entrepreneurial spirit into a large organization.