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| The PRO-Productivity System (tm) | |
by Laurence G. Lyon Because of the length of this article, we have broken it into several sections. Below is the index, which is linked to each section. If you are interested in a particular subject, click on it to go there. Otherwise, you will find a link at the bottom of each section that offers you the the choice of returning to the index or continuing on to the following section.
7. THE EXECUTIVE DECISION
9. INVOLVING ALL EMPLOYEES
10. THE NEXT STEP
The PRO-Productivity System (tm) Participation -- Responsibility -- Ownership
Copyright ©1996-1999 by Laurence G. Lyon and by Menke & Associates, Inc. All rights reserved.
You've read about them--companies that seem to have found the key to success in an unstable business environment:
"Sales Jump 312% as Employees Learn Rules of the Game" at Springfield Remanufacturing Corporation in Missouri. Management Accounting, 5/92. Inc. magazine awards its Entrepreneur of the Year award to all 240 owner-employees of the Connecticut firm Reflexite, Inc. Out of 2700 private companies evaluated, 4 of the 5 finalists had substantial employee ownership. Inc., 1/92. "Improving Productivity Earns Dalton Foundries Senate Award" -- "The Warsaw, Indiana foundry was presented the United States Senate's highest honor, its Productivity Award ... [Employees] bet their jobs and retirements on the ESOP and knew they had a lot to lose if the buyout failed." modern casting, 1/92. The National Association of Employee Ownership contrasted private companies before and after installing an Employee Stock Ownership Plan: 73% "significantly improved their performance." Harvard Business Review, 9/87. Even if you don't subscribe to modern casting, it's hard to overlook results like these. Over 11,000 of America's most successful companies are currently using Employee Stock Ownership Plans to increase productivity and profitability, to grow the company, and to cash out shareholders tax free.
The increasing popularity of ESOPs as a business tool stems from their flexibility. How the program will be applied by managers and understood by the employees depends almost completely on the choices of current shareholders. Owners can legitimately utilize ESOP-based productivity enhancement programs whenever they're concerned about any one of the four S's: Success, Survival, Satisfaction, or Succession.
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