The Problem with ESOP’s
February 12, 2025
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The previous articles discussed the theme of rewards and their uses in modern organizations from multiple perspectives. The focus of the discussion was on how an effective rewards management system can boost productivity and improve job satisfaction leading to all round benefits to the companies and their employees.
This article discusses the cutting edge research in rewards management that has been studied in a recent book, Give and Take, by the noted Wharton Professor, Adam Grant. This research that has been published in 2013 notes that organizations are made up of employees who can be classified as givers, takers, and matchers.
The givers are the ones who proactively help others and build great teams whereas the takers are the ones who are always receiving help instead of giving back to the team. The matchers are evenly poised with their attitude of giving as much as they take and nothing more.
The givers operate in high performance cultures where they help others, share knowledge, offer to mentor other employees, and make connections without expecting anything in return.
The takers dominated culture on the other hand thrives by expecting others to help them as much as possible without giving anything in return. Of course, the research showed that most organizations fall somewhere in between with an equal amount of give and take and hence, these cultures are known as matcher cultures.
The implications for rewards management are that the rewards systems must encourage employees to seek and provide help, and reward these employees more than the matchers or the takers, and should screen out the takers so that they do not garner a major share of the rewards. This is a sure fire formula for success in the modern workplace.
The key point here is that in an organizational culture that encourages reciprocity there are fewer conflicts between employees and the rewards management systems must be geared towards encouraging the employees to both seek and provide assistance.
In many multinationals during the induction training, employees are told to not keep knowledge to themselves like they did in college and remember that now they are operating in a team environment where knowledge is to be shared instead of horded. The rewards systems likewise are tailored to ensure that the givers are encouraged and those who are selfish are sidelined.
Of course, it is easier said than done to implement giver cultures as the research proved. Employees most often struggle to make the transition from a competitive culture to a cooperative culture since the incentives are still aligned to results.
Hence, the implications for organizations are that their performance appraisals and rewards systems must include bonuses for those who contribute to the team the most and this has been proved in the research as well.
Finally, organizations must not view the rewards system as a zero sum game where the balance between the givers and the takers evens out. Instead, the rewards systems must be designed in a manner that would create synergies between the teams.
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