Re: Incentives LO1143

Tom Burke (
Wed, 10 May 95 18:47 PDT

Replying to LO1119 --

Mike McMaster wrote:
>Mine was to point you outside of the set of thinking that you are
>bound by. Sorry that I failed so miserably.

Mike, I appreciate your kind reponse. I am don't believe you failed. I
just still disagree. I point me to any specific program which denies a
worker "fair" compensation which is seen as a positive to the worker. The
concept of what is "fair" will be defined by the worker. That definition,
IMHO, will be dynamic, it will change with time and place. If I were in a
biz that could generate enormouse revenues, I would want more than in a
biz where there were few resources. Example? Take baseball (please).
Millions of dollars for anyone playing that game is nearly insane.
Fairness, from the player point of view, includes what the others are
getting for their labor, which is also influenced by how much money exists
in the system (the ol' supply and demand stuff). To fail the attempt at
fairness brings dissonance. My system requires two primary tasks. One
task is to care for the service needs of a client. One task is to care
for all the data relating to that care. These two tasks are presently
being done by the same people. A Client Service Rep maintains the data
(input into a computer system and filing system!) and deals with the
client regarding their needs. The fair system, IMHO, begins with an equal
distribution of the work with equally competent people. With equal
competent people handeling eqully balanced work load, they should be paid
an equal amount of money.

There are several flaws to this equality. First, equally paid people do
not get rewarded in their takehome pay by equal amounts. I do see the
basic pay structure as an incentive. If it were not so, they would find
an incentive to work elsewhere. I, want certain things done. I want more
done of those things which I want done. Now I have tried to arrive at my
conclusions in a fair way, including others in the decisions, distributing
the authority, giving the keys to measurement to the staff. Yet, from
some I get more than others. I want to encourage both. Those who respond
by producing more of what I want will want more than those who don't. It
will be unfair to them to find equal rewards for unequal efforts. Even if
the efforts were equal, productivity will still be unequal. We get
unequal results.

We have a client who rewards my firm with their biz. There will be some
quantity of money in the system to distribute. I feel compelled to at
least distribute some of it. These workers are not being paid by me. My
investment goes to capital improvements and balance sheet stuff. It is
the client's money that pays the bills. This is important. The client
stays with us because of the direct effots of the staff. Those who do
better, keep more clients longer, producing more $$$ for the system. It
seems quite fair to pay for what their contribution to the system. Now,
let's pay them all based on a flat wage. One CSR produces X, another
produces X times 2. Into the system flows more rewards to the biz caused
by CSR number 2. Where is the equity in keeping them both at equal pay?
If we pay for what they are providing into the system, it seems they will
be encouraged to think about the system instead of the clock. It seems to
me that by working to enhance the system, they have some expectations from
the system. It would seem a proper loop.

I stand willing to be pointed anywhere. I want to find the data that
tells me I am wrong. Here is what I presently have planned. I will use
Best-Practices comparison to determine what the percentage of wages paid
should be to revenues. I will establish a base wage which will be
modestly lower than the set percentage. Then I will distribute the
percentage remaining in proportion to contribution to those revenues. In
order for anyone to get rewarded beyond the base, the group must do
better. In order for individuals to get more of what the group has
available, they must contribute more.

Where is the flaw? My thanks.
Tom Burke
Ramona, California