Gainsharing

From Wikipedia, the free encyclopedia

Gainsharing is a corporate incentive plan designed to involve employees with management to increase productivity by directly linking compensation to specific productivity and cost gains. Gains that can be easily and quantitatively measured, such as hours logged, complaints satisfactorily resolved or materials used, are measured and entered into a predetermined compensation formula. These gains are then shared with the employees. The intended result is a more proactive and efficient workforce with a keen interest in the corporate bottomline. Instead of rewarding input, compensation is tilted towards outcome and employees eager to enjoy further compensation will increase attention to organizational goals and objectives.

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