“I used to run the company that made Formula 409, the spray cleaner. From modest entrepreneurial beginnings, we’d gone national and shipped the hell out of P& G, Colgate, Drackett, and every other giant that raised its head. From the beginning, I’d employed a simple incentive plan based on ‘case sales’: Every month, every salesman and executive received a bonus check based on how many cases of 409 he’d sold. Even bonuses for the support staff were based on monthly case sales. It was a happy time, with everyone making a lot of money, including me.” “We abandoned our monthly case- sales bonus plan and installed an annual profit- sharing plan, based on personnel evaluations. It didn’t take long for the new plan to produce results.” Source: Wilson Harrell, “Inspire Action: What Really Motivates Your People to Excel?” Success, September 1995.

What do you think happened at this company after it started the annual profit- sharing plan?

  • CreatedDecember 15, 2014
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