◼ TECHNOLOGY Bloomberg Businessweek June 24, 201930
dailyauctionsofworkassignmentsandbattles
forthebestideasintheaptlynamed“Colosseum.”
Paymentsaresettledina virtualcurrencycalled
“Will,”withbalancespaidinyenattheendofeach
quarter.“We’vecreateda freeeconomiczone,just
likewhatexistsoutsidethecompany,”saysToshio
Naito,whodesignedtheprogramandhascontin-
uedtoworkonit sinceitsimplementationin2011.
“Workshouldbeaboutfreedom,notorders.”
Theapproachhassofarpaidoff.Disco’soper-
atingmarginhasrisento26%from16%sincethe
experimentwasimplementedeightyearsago,
anditsprofitabilityis theenvyoftheindustry.Its
sharepricehasalmostquadrupledinthatperiod,
toroughly16,000yen($148),givingthecompany
a $5billionmarketvalue.Thankstobonuses,
workerpayis morethandoublethenationalaver-
ageof4.7millionyen,andin2017,Discowasthe
firsttowina newgovernmentawardforcreating
anidealworkplace.
Yetdespiteitsprovensuccessanddozensof
inquiriesandtrainingsessionswithothercompa-
nies,nonehaveadoptedtheideasofar.Engineers
havequit,complainingtheapproachdetractsfrom
theirabilitytofocuspurelyonresearch.Othershave
beendrivenawaybythenever-endingpressureto
performtogeta bonus.Andbigpayoutsaren’tguar-
anteed,whichmeansenduringa high-pressurework
environmentwithoutmuchofa benefit.Therelent-
lessfocusonquarterlyprofitscanencourageshort-
termthinking,saysTakashiShimizu,a professorat
WasedaUniversityinTokyowhostudiesaccount-
ingandmanagementsystems.“Seniormanage-
mentmustnotgettrappedina short-termloop,”he
says.There’salsoa culturalchallenge.It tookabout
fiveyearsforstaffinJapantoadjust,andworkersin
theU.S.andChinastillhaven’tfullyembracedthe
approach,Naitosays.
Butthosewhoadaptemphasizethefreedomto
shapetheirowndayandthevalueplacedontheir
effortsandtheirowntimeinparticular.Theysay
theruthlessnessofa hardcorefree-marketapproach
is dilutedina settingwherepeopleworkside-by-
side.“It’sbecomelikesecondnature,”saysNaoki
Sakamoto,a DiscofactoryworkerinHiroshima.
“Beingabletomeasureeverythingcreatesmore
interestandconfidence.”
Disco,foundedin 1937 asDai-IchiSeitoshoCo.,
beganbysupplyingcuttingtoolstotheJapanesemil-
itarypriortoWorldWarII.Itssawsanddiamond
bladeshavesincebeenusedtocuteverything,even
moonrocksbroughtbackfromtheApollo11 mis-
sion. Today, it’s the world’s largest maker of equip-
ment that slices and dices silicon ingots and wafers
before they’re converted into electronic chips. Likemany manufacturers, Disco spent decades looking
for ways to boost efficiency, settling on an approach
based on Kyocera Corp.’s Amoeba Management,
which operates its thousands of internal teams as
individual companies (amoebas). Disco, under
Naito’s guidance, extended that autonomy to indi-
vidual employees and called it “Personal Will” (from
which the virtual currency’s name is derived).
At the heart of the program is a compensation
system that meticulously tracks how much every
person and team contributes to earnings. Workers
receive a base salary, which they augment by earn-
ing Will for completing tasks. Quarterly bonuses can
rival a year’s pay for top performers, says Naito. “It’s
enough to buy a foreign-brand car every year,” he
says. “We call it the ‘Will Dream.’ ”
Earning virtual currency begins at the team
level, where bosses allocate a portion of the group’s
Will budget to each task they must complete. Team
members then use an app to bid in an auction for
those jobs. Assignments that don’t attract any bids
often turn out to be unnecessary, Naito says. And
managers who’ve misused or abused the system
have been abandoned by their workers, who are
free to move to other teams.
Groups pay each other to complete tasks. Sales
teams pay factory workers to produce goods, who
in turn pay engineers to design products. Once a
sale is made, it generates a certain amount of Will
that trickles through to everyone in the supply
chain, including human resources and IT support
staff. “For example, today I paid Will for this meet-
ing room and also for Naito to come in and spend
his time to talk to you,” Sumio Masuchi, head of
Disco’s press team, tells Bloomberg reporters. “But
once your article is published, I’ll get Will for gen-
erating publicity.”
There’s a penalty system for inefficient behavior,
which includes piling up unnecessary inventory or
even working late. Overtime hours have fallen 9%
since penalties were implemented in 2015, aligning
with the Japanese government’s goal to improve
work-life balance. “Economic forces are doing all
the things managers used to spend time on,” says
Naito. Employees can earn extra Will by helping
each other: A parent who wants to see a kid’s base-
ball game can pay a colleague in the currency to fin-
ish a report. A software engineer can earn extra by
offering coding skills to another team. Creating Excel
macros or translation work are typical requests.
Then there are the daily competitions in the
Colosseum, a 200-seat auditorium at headquar-
ters where employees and executives make bets
on ideas that have been implemented by the
teams to increase profits. Any employee can make“He wanted a
system like in
Final Fantasy or
Dragon Quest
that would
make work
fun but also
strengthen the
company”