Summary
This paper addresses the issue of how gainsharing programs work by proposing a model of gainsharing as an organizational learning system. We analyzed employee suggestions submitted over the first four years of a gainsharing plan at one plant and found that although traditional explanations of how gainsharing works predicted changes in volume of total suggestions, changes in the content of those suggestions were consistent with an organizational learning process. Suggestions indicating first-order learning were initially high but declined over time as a percentage of total suggestions, while suggestions congruent with second-order learning became a larger portion of the total suggestions over time.