area51novel #311 - Difficulties with dividends and incentives
#311 - Difficulties with dividends and incentives
The iteration of computers was a big deal. After successfully completing this major transaction, the recovered funds made Dawn Computer Company rich overnight!
As a product company directly under the Dawn Research Institute, this was their first large-scale realization of profits.
Previously, domestic applications were not priced according to market rules but based on cost. This meant that the early research and development would have resulted in a loss if it weren't for Ren Zhong's knack for making money, turning a penicillin business into a cash cow, reaping considerable profits worldwide to support the enormous expenses of the entire research institute.
Now, it was the computer's turn to significantly replenish funds.
Yanjing.
Dawn Computer Company was filled with jubilation.
"Director An, do you think the money earned this time will allow our company to realize performance-based bonuses?" An Ke's secretary, Li Houcheng, couldn't help but ask excitedly after reporting on today's work.
"Little Li, were you asked to inquire on behalf of others?" An Ke glanced at him.
"Hehe, Director An, everyone is very concerned," Li Houcheng chuckled, implicitly admitting it.
"Tell everyone to focus on their work and ensure the production and delivery of this batch of products. Let's do our job well first. If we achieve results, the company will naturally issue corresponding rewards. Stop snooping around all day," An Ke said somewhat sternly.
"Yes, Director An! I understand," Li Houcheng didn't receive a clear signal, but it was evident that the company still had incentives. This meant that everyone would indeed have a windfall beyond their salaries, just unsure how much.
"The combination of immediate and long-term incentives, with performance-based incentives in addition to the monthly salary, is a good design. However, the total amount of incentives is still too small. Xiao An, your idea of letting the wealthy lead the way for others is commendable. Some fraternal units do have slower cycles to see results, and the technology for the products is also provided by the research institute. The profit is indeed not solely due to the efforts of the computer company itself.
Therefore, giving half of the bonus to the institute for overall planning and sharing it with other fraternal units, I think this approach is without problems."
This wave of major deals for Dawn Computer, when converted into domestic currency, amounted to at least 500 million in gross profit! The net profit was also over 300 million. According to previous regulations, the company team's bonus options were 5% of the profit, which would be 15 million!
You must know that everyone's salary is still between 30 and 100 yuan. Now that the computer company only has over 500 people, if this bonus were to be distributed, the average would be around 3,000 yuan per person, which would be a huge sum for people now.
If it were to be realized, it would undoubtedly cause a great uproar.
Of course, if it's not realized, the consequences would be significant.
The patch solution proposed by An Ke and others is currently considered acceptable for companies under the Dawn Research Institute system.
"In addition, I suggest that besides giving money, you can also consider various welfare methods, such as setting it aside as everyone's housing provident fund, improving employees' housing in batches, without all waiting for the government to distribute welfare housing."
An Ke recorded Ren Zhong's suggestions one by one. As the first pilot unit for performance-based distribution, this plan couldn't be more cautious.
After seeing An Ke and his group off, Ren Zhong also fell into deep thought.
When considering this mechanism initially, he hadn't thought it through clearly enough.
Many companies and technologies are currently unable to be fully marketized, and the realization of benefits in enterprises is very distorted, especially military-related companies and departments, which are now allocated at cost price, and this doesn't reflect the benefits of good company operations.
Therefore, this issue is a major problem for the Dawn Research Institute.
It is also a challenge for the management of the entire pillar state-owned enterprises.
Ren Zhong began to take it seriously now that he was truly about to start implementing it.
Not only was he thinking about it, but he also brought this issue back to the main world, allowing keyboard warriors to think about it.
"This plan is good, perfectly realizing the unity of spiritual and material incentives, and also realizing the unity of long-term and short-term incentives. It doesn't disrupt the current salary system and takes into account the characteristics of fairness, justice, and openness. Not bad, really not bad!"
When Staff Officer Ye saw Ren Zhong's new plan and read it carefully, he couldn't help but praise it.
From the perspective of incentive methods, Ren Zhong limited the gap in salaries, advancing from both the management and technical levels. The management level assesses efficiency, while the technical level assesses value realization. Public assessments are conducted annually, and the results are announced, with the top 10% being rated as advanced individuals. The assessment grades are divided into four levels: ABCD, with A grades given priority for promotion in position and rank, and D grades will be demoted. Three consecutive years of D grades will be considered for dismissal, solving the problem of being able to move up and down, in and out.
In terms of salary differences, the upper limit is capped within a 3-fold difference.
However, in terms of welfare, according to the current mechanism, bonuses can be converted into housing. From single collective dormitories to one-bedroom, two-bedroom, and three-bedroom suites, companies can apply to use bonuses to build housing and distribute it to their employees to improve their living conditions.
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In this way, employees can still receive the profits they create, but in terms of social impact, this has less impact than directly distributing money, and it also benefits the stability of the employee team.
As for the portion handed over to the institute, it is regarded as pure technical dividends. These clauses also apply to technical inventors created by the enterprise itself, that is, if the technology is obtained through the invention and creation of the company, then the profit realized by this technology belongs to the company's own technical invention team.
"Old Brother Ren, you really have broad ideas and a high level. The bonus issues of my enterprises have also become prominent. Now that I have your plan, I think they can all be easily solved," Staff Officer Ye praised.
"Perhaps it's okay now, but in the long run, after all, much of it relies on manual operation for implementation. These policies are likely to be distorted during implementation, creating drawbacks. We must improve the supervision and auditing systems of these enterprises and not allow these drawbacks to be amplified and expanded. We will handle each case as it is discovered," Ren Zhong wasn't so optimistic.
However, it's enough for the current stage. People are widely focused on contributing and emphasizing spiritual incentives.
It's just that Ren Zhong has explored spiritual and material incentives in advance, roughly improving them by one level compared to chaotic, purely manual operation.
At least, it's enough for the current stage.
"Old Brother Ren, you're right. Most of our comrades are good under most circumstances, but now that we have entered a new construction phase, it is inevitable that some will be lost in the new social conditions. Through supervision and auditing, we can also prevent problems before they occur and reduce the opportunities for these comrades to make mistakes and large mistakes. We will definitely improve and resolutely implement these strategies."
Second update, continuing to ask for monthly tickets.