Wawa Inc.
The Wawa associates have an ESOP which plays a key role in Wawa’s culture of ownership. This case explores the role of incentives and levers of control to create a successful retail chain.
Employee Ownership: A Theoretical and Empirical Investigation of Management Entrenchment vs. Reward Management
Employee ownership is often used not only as a reward management tool but also as an entrenchment mechanism. The literature suggests that good managers use employee ownership as a reward management tool, whereas bad managers implement it for entrenchment, thus suggesting the existence of an equilibrium level of employee ownership. The contributions of this paper … Read More
Workplace Democracy in the Lab
While intuition suggests that empowering workers to have some say in the control of the firm is likely to have beneficial effects, empirical evidence of such effects is hard to come by because of numerous confounding factors in the naturally occurring data. We report evidence from a real‐effort experiment confirming that worker performance is sensitive … Read More
Money Left on the Table: An Analysis of Participation in Employee Stock Purchase Plans
This paper analyzes participation decisions in employee stock purchase plans. These plans allow employees to buy company stock at a discount from the market price and resell it immediately for a sure profit. Although an average employee stands to gain $3,079 annually, only 30% of individuals take advantage of this risk-free opportunity. Participation is more … Read More
Wunnerful, Wunnerful! The Lawrence Welk ESOP
In 1964, the famous television bandleader Lawrence Welk went for a drive in the country north of San Diego, Calif. planning to invest in a grove of orange trees. Instead he bought a motel and a nine-hole golf course. One of the keys to their business success has been their philosophy of treating their employees like family…
ESOP and 401(k) Coordination Tips in a Post-Disclosure World
After several postponements, 401(k) fee disclosure was mandated by the Department of Labor (DOL) before July 1st of 2012. So what kind of impact have we seen in the ESOP world? Has it been successful in helping plan sponsors and participants understand the costs of their 401(k) plans?
Can Employee-Owned Companies Reboot the Economy?
If owners of businesses are reaping the rewards of economic growth at the expense of workers, then why not just try to increase the number of workers who also own a piece of the firms that employ them?
Note on Motivation
This note discusses the complex topic of motivation, including the issue of contingent compensation…
Broad-Based Equity Compensation, Employee Turnover, and Unit Performance
This study, which consists of two essays, examines the performance effects of a deferred equity plan on both individual employee and business unit outcomes. The first essay investigates the effects of deferred compensation plan characteristics on voluntary turnover decisions, using detailed data on store-level employees of a large retail firm. Overall, I find that employees … Read More
Employee Stock Ownership Plans and Their Effect on Productivity: The Case of Huawei
This case study describes Huawei, a Chinese telecommunications equipment company, which heavily utilizes ESOP ownership, and applies Huawei’s results to describe ESOPs as a powerful tool for achieving corporate efficiency and growth.
Selling Ownership to an ESOP: An Attractive Route to Cashing Out
Any business owner who evaluates their succession options without investigating the concept of an employee stock ownership plan will be making a mistake. What is an ESOP, and how does it work?
Communication for an Employee-Owned Company
Communication benefits the employee-ownership plan of a company in many ways. A well-communicated plan and a well-planned communication campaign are much more likely to accomplish your objectives…
Owning Our Future: The Emerging Ownership Revolution
Looking around at the wreckage left in the wake of the world economy’s latest crisis, veteran business journalist Marjorie Kelly noticed that some institutions were left relatively unscathed. What did they have in common? The key, Kelly realized, is seemingly obscure: ownership. Prominent among the survivors were organizations that combined the flexibility of traditional private ownership with a focus on the common good…
Democratic Enterprise: Ethical Business for the 21st Century
Designed for undergraduate students, Democratic Enterprise provides an open access, introductory-level analysis of democratic models of enterprise, namely co-operatives and employee-owned businesses.
Client Profile: Dini Partners, Inc.
Dini Partners, Inc. became an S-Corporation as of Jan. 1, 2012. ‘It was clearly a way to define an ownership transition. The ESOP provided a path to an orderly transition of ownership. Also, as some of our senior members of the staff transition into retirement, we needed a vehicle to incentivize the younger, talented professionals to have a long-term stake in the firm.’
Using Ownership Incentives in China
Roy Weber met Cheng Wang, a business consultant and Chinese entrepreneur, at Cheng’s hotel bar in Silicon Valley. Although Roy was slightly familiar with Chinese business practices, he welcomed more advice from a Chinese national. Could Roy transplant Silicon Valley’s model of employee ownership to China, and what would this process entail for a technology startup?
Client Profile: CMC Rescue, Inc.
CMC Rescue became 92 percent employee owned in 2011. Jim came to the realization that employee ownership could realistically be the only way to assure continuation of CMC with its current operations and employees…
Client Profile: n-Link Corporation
n-Link Founder Sandra Green explains that in the early days she wasn’t exactly certain what employee ownership entailed but knew intrinsically that it was a good thing for the company and the employees.
Sustaining Employee Ownership for the Long Term: The Challenge of the Mature ESOP Company
What do veteran ESOP companies have much to teach us about what it takes to sustain employee ownership over the long term?
Creating a High-Performing Workplace
Beyster Institute Senior Consultant Martin Staubus is teaching a course entitled ‘Management 269: Creating a High-Performing Workplace.’ In this interview, Professor Staubus describes the course’s five themes.
Employees Matter: Maximizing Company Value Through Workforce Engagement
Increasing numbers of businesses view their employees not as a mere cost but as invaluable contributors for business success. These firms are implementing strategies to fully engage employees at all levels. The Employees Matter report identifies sixteen fast growing entrepreneurial firms that employ employee ownership and engagement strategies which they perceive as directly linked with improved business performance. Eight other notable companies with key lessons to share are included as sidebar profiles.
Taking Stock: Are Employee Options Good for Business?
Many workers view stock options as a way to get a piece of their company’s action and share a stake in its overall performance. But what’s in it for employers?
Client Profile: Los Angeles Engineering
Learn more about a unique engineering company that has been providing critical infrastructure services throughout southern California since 1986…
Elizabeth Jacobs: Price-Earnings Ratios and Employee Stock Option Grants
Elizabeth had a number of concerns related to the heavy use of employee stock options as incentives and employee compensation in the high-technology sector…
Science Applications International Corporation (SAIC) (A, B)
At the start, Dr. Beyster made the decision that SAIC would be employee owned and that ownership would be based on merit and contribution to the company, not tenure. Using employee ownership as a selling point to prospective hires, Dr. Beyster was able to recruit talented employees and build a successful organizational culture. However, changes made after Dr. Beyster stepped down would have implications for SAIC’s company culture…