The relationship between profit-sharing/gain-sharing plans, productivity and economic value added

Journal of the Academy of Business and Economics, Jan, 2004 by Elizabeth Krauter, Leonardo Fernando Cruz Basso, Herbert Kimura

The table 2 displays the agreement and disagreement of the respondents.

The assertion 1--"the company adopts a system of variable remuneration"--had the agreement of 65.9% of the respondents and the disagreement of 24.2%. The median was 2, what indicates little agreement with the assertion.

87.9% of the respondents agreed with the assertion 2--"the company has a profitsharing or a gainsharing plan". The median was 1, a high agreement degree.

The vast majority, or 81.3% of the respondents, agreed with the assertion 3--"the participation plan attains all the hierarchical levels". The median of the answers was 1.

The assertion 4--"the company deployed the profitsharing or the gainsharing plan by legal imposition"--obtained the agreement of 51.6% and the disagreement of 37.4%. The median was 2.

70.3% of the respondents agreed with the assertion 5--"the company deployed the participation plan to increase productivity". 20.9% disagreed of the assertion. The median was 2.

The assertion 6--"the participation plan is based only on profits and conditioned to goals"--had the agreement of 31.9% and the disagreement of 59.3% of the respondents. The median was 5, which demonstrates a high degree of disagreement.

57.1% of the respondents agreed with the assertion 7--"the participation plan is based only on results and conditioned to goals", and 29.7% disagreed. The median was 2.

The assertion 8--"the participation plan is based on profits and results and conditioned to goals" obtained the agreement of 58.2% of the respondents and the disagreement of 30.8%. The median was 2,5, i.e., between I agree to some extent and indifferent.

"The company pays a fixed value as participation plan" was the assertion 9, which had the agreement of 41.7% and the disagreement of 50.6% of the respondents. The median was 4, i.e., the respondents disagreed little of the assertion.

With a basis on this data, we can infer that more than half of the companies that participated in the survey adopt a system of variable remuneration, and most of those companies have a profitsharing or a gainsharing plan. This plan attains all the hierarchical levels at the vast majority of companies. Slightly more than half of the sample group deployed the plan, as it is mandatory by law. Most of the companies deployed the plan with the objective of boosting productivity. Practically the same percentage of the companies deployed a plan based on results and conditioned to goals, and a plan based on profits and results and conditioned to goals. An expressive percentage of companies pay a fixed value as participation.

50.5% of the respondents agreed with the assertion 10--"the company considers its more important concern to generate profit to the shareholder". 38.5% disagreed. The median was 2.

The assertion 11--"the shareholder is entitled of collecting a higher return of his/her company on the invested capital in the company, to the return that would have if his/her applied in other investments" had the agreement of 72.7% and the disagreement of 19.8% of the respondents. The median was 2.