Case: Large Enterprise and Entrepreneurial Spirit

Scenario

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.

Deployment

• 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

Impact

• 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.