Questions continually arise with respect to employee owned businesses concerning the effects employee ownership on the operational and financial performance of such enterprises. Assumptions are often made in the affirmative with respect to such questions because it is thought that employees work harder when they are owners. These assumptions create a problem because definitive assessments concerning the assumptions are not widely available. This problem was investigated in this research study. The problem statement/purpose, problem background, research questions, operational definitions, dependent and independent variables, definition of technical terms, hypotheses, scope and limitations, and general procedures applicable to this study are covered in this chapter.
The motivation of employees and the improvement of productivity are topics which have generated significant levels of interest for management, labor, government, and academia for several decades. One of the many approaches employed as a means of enhancing both motivation and productivity is one that is based on profit sharing between an organization and its production employees. It should be noted, however, that the profit sharing concept has never been widely implemented with respect to production employees by large North American corporations.
The profit sharing concept may be employed in several ways. Probably the most common application found in the United States
is similar to the arrangement found in the automobile industry. In the automobile industry, profit sharing agreements are written into collective bargaining contracts (Bureau of Labor Statistics, 1984, p. 54). Under arrangements such as the one found in the automobile industry, corporations share profits with their production employees at predetermined rates, once the minimum level of profits specified in the collective bargaining agreements have been attained. In such arrangements, the prod...