What is the scanlon plan?

Scanlon plan is a model for business organization. This type of organizational structure is a program sharing program and seeks to involve employees directly in the company's decision -making processes to benefit from employees' proposals and contributions. Employees are rewarded for their entry and assistance through sharing plans to dispel part of the economic benefits generated by a more engaged work force to members of this workforce. These plans work best in environments where employees have a relatively stable and long -term attachment to one corporation.

Joseph Scanlon, for which this type of management plan is named, implemented the first such system in the first years of great depression. Its initial goal was to save businesses endangered by economic collapse and thus draw collective skills and wisdom of the entire labor force in the company. Early examples of the Scanlon plan were generally Successful, and this approach to relationships with work management in the coming years firmly gained land.

A simple piece of logic is the core of the scanlon plan: if all employees have a personal and tangible financial share in the success of the corporation, they contribute more actively to its success. This share is usually created using a profit sharing system. In such a system, employees are part of the process of allocating work and capital resources within the company. Employees then share part of any cost savings that are able to generate through systematic improvements or more devoted and productive work.

employees' proposals are generally filtered through committees. In the standard scanlon plan, many manufacturing committees operate at the level of the department to obtain and discuss ways to improve productivity. Screening Committee operates at a higher level and consists of members of workforce and leadership representatives. This committee reviews progress in improving efficiency and calculatesThe amount of further compensation to be paid to workers as their share in these improvements.

Scanlon plan can dramatically improve the efficiency of production and operation in the company, large or small. These plans create a gradual incremental improvement and create results in medium or long -term rather rapid cost savings. Such plans are most effective when they have time to work. They also benefit from real, rather than formal participation of workers and administration. If both workers and management are actively devoted to the scanlon plan and stick to it in a few years, the rewards may be considerable.