Profile of a Successful Company

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OL:325: Total Rewards 2-2 Case Study Eileen Bertera Gain Sharing at CircleWorks Many companies must deal with employee motivation issues for increased productivity and overall improved company performance. As we review CircleWorks, a bicycle manufacturing organization, we see the HR director, Sheila Gaines, struggling with the best motivational incentive to increase productivity and morale of the employees. CircleWorks is a fourth generation family run organization that is firmly ground in its traditional management practices and this view dominates the organizational culture. With the onset of future competition, Ms. Gaines is concerned about employee motivation. Management is indifferent to employee input and feels the satisfaction should come from the job itself. Knowing motivation is becoming an issue in overall company performance, Ms. Gaines seeks to find an incentive program suitable for this organization. All the bikes are built with a team of four or five employees. With the team in mind, Ms. Gaines is seeking an incentive plan geared more towards the group scenario versus individual incentive plans. She has considered productivity bonuses awarded to the teams, but has also considered implementing a gain sharing plan. Productivity bonuses limit motivation to the entire staff as it is based on individual performance. This may lead to undesirable workplace behavior in quality versus output. Gainsharing offers a group incentive system that provides participating employees with an incentive payment based on improved company performance and increased productivity. This group incentive rewards employees for collective performance, not individual performance. Gainsharing as a motivational tool encourages teamwork and provides a basis for participation and empowerment. The primary components of an effective gainsharing plan include: * A formula to keep

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