374 ENTREPRENEURSHIP
Each business needs to identify its own managerial strengths and develop a system
around them. That is what the companies described below have done, and it has earned
them a reputation as some of the best entrepreneurial companies in the United States to
work for.^78 These practices can be used as benchmarks by others, but the real challenge
is to customize them to the special context of each enterprise.Best Compensation Practices
The level of pay alone does not motivate workers, but it is an essential component. Pay
fairness is equally important, and so is a transparent process that enables people to see
how pay is determined. Rewards must relate directly to what the company wants its peo-
ple to accomplish. It is fallacy to hope that people will do A when their rewards come
from B.- A photo-image printing firm empowers employees to determine what skills are
needed to do the job and then rewards them for proficiency and for their ability to
teach others. They grade themselves. - A communications equipment maker sets compensation for each employee
at the level of customer satisfaction. An annual customer survey and a measure of
product service and reliability are used. - A software services consultant offers customized pay packages with cafeteria-style
benefits. A menu of annual salary, hourly salary, or a blend can foster mutual risk
sharing between employer and employee. - A midwestern manufacturer instituted a gain-sharing program that rewards
employees with a percentage of the savings or profits from their suggestions and
innovations. It also encourages ideas with a Gainsharing News newsletter.
Best Training Practices
Training is an investment in human resources, and exceptional training can be a source
of SCA for the enterprise. Skill-intensive training improves the current level of employ-
ee productivity. Training can anticipate changes in the nature of work so that when job
requirements change, there is no decline in productivity. Management training serves
three purposes: It enables workers to better understand their managers’ roles, it helps
employees manage themselves, and it prepares people for promotion to management
ranks.- A computer systems installer enables employees to mentor each other. An expert
employee spreads both skill and management knowledge to peers. - An airplane furniture maker focuses training on “learning to learn.” Saturday ses-
sions of exercises and role-playing allow people to break down barriers to commu-
nication and improve teamwork. - Coffee megastar Starbucks ties training to business strategy by formally
building employees’ identification with the company. Classes stress everything from
basic product knowledge to interpersonal relationships.