Who is predicted the specialization of mental work and suggested profit sharing
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EMPLOYEE WORKS, PARTNER OWNS He believed that the more he shared profits with his associates, the more profit the company would gain. Other than sharing profits, Sam also provided them incentive bonuses, discount stock purchase plans, and health benefits. Show <3 Profit sharing is various incentive plans introduced by businesses that provide direct or indirect payments to employees that depend on company's profitability in addition to employees' regular salary and bonuses. In publicly traded companies these plans typically amount to allocation of shares to employees. The profit sharing plans are based on predetermined economic sharing rules that define the split of gains between the company as a principal and the employee as an agent.[1] For example, suppose the profits are x{\displaystyle x}  Profit-sharing tends to lead to less conflict and more cooperation between labor and their employers.[2][3] History[edit]Profit sharing has been common among traditional fishing communities in Indonesia.[4] In the West it was introduced by American politician Albert Gallatin on his glass works in the 1790s, but the modern type of profit-sharing plans was developed later in the 19th century.[5] William Cooper Procter established a profit-sharing plan in Procter & Gamble in 1887.[6] Another of early pioneers of profit sharing was English politician Theodore Taylor, who is known to have introduced the practice in his woollen mills during the late 1800s.[7] The share of profits paid to the management or to the board of directors is sometimes called the tantième.[citation needed] This French term is generally applied in describing the business and finance practices of certain European countries, including Germany, France, Belgium, and Sweden. It is usually paid in addition to the manager's (or director's) fixed salary and bonuses (bonuses usually depend on profits as well, and often bonuses and tantieme are treated as the same thing); laws vary from country to country. United States[edit]In the United States, a profit sharing plan can be set up where all or some of the employee's profit sharing amount can be contributed to a retirement plan. These are often used in conjunction with 401(k) plans. Gainsharing[edit]Gainsharing is a program that returns cost savings to the employees, usually as a lump-sum bonus. It is a productivity measure, as opposed to profit-sharing which is a profitability measure. There are three major types of gainsharing: Prior to the early 1900s, there was no management theory as we think of it today. Work happened as it always had—those with the skills did the work in the way they thought best (usually the way it had always been done). The concept that work could be studied and the work process improved did not formally exist before the ideas of Frederick Winslow Taylor. The scientific management movement produced revolutionary ideas for the time—ideas such as employee training and implementing standardized best practices to improve productivity. Taylor’s theory was called scientific because to develop it, he employed techniques borrowed from botanists and chemists, such as analysis, observation, synthesis, rationality, and logic. You may decide as you read more about Taylor that by today’s criteria he was not the worker’s “friend.” However, Taylor must be given credit for creating the concept of an organization being run “as a business” or in a “businesslike manner,” meaning efficiently and productively. Frederick W. TaylorFrederick Taylor (1856–1915) is called the Father of Scientific Management. Before the Industrial Revolution, most businesses were small operations, averaging three or four people. Owners frequently labored next to employees, knew what they were capable of, and closely directed their work. The dynamics of the workplace changed dramatically in the United States with the Industrial Revolution. Factory owners and managers did not possess close relationships with their employees. The workers “on the floor” controlled the work process and generally worked only hard enough to make sure they would not be fired. There was little or no incentive to work harder than the next man (or woman). Taylor was a mechanical engineer who was primarily interested in the type of work done in factories and mechanical shops. He observed that the owners and managers of the factories knew little about what actually took place in the workshops. Taylor believed that the system could be improved, and he looked around for an incentive. He settled on money. He believed a worker should get “a fair day’s pay for a fair day’s work”—no more, no less. If the worker couldn’t work to the target, then the person shouldn’t be working at all. Taylor also believed that management and labor should cooperate and work together to meet goals. He was the first to suggest that the primary functions of managers should be planning and training. In 1909, Taylor published The Principles of Scientific Management. In this book, he suggested that productivity would increase if jobs were optimized and simplified. He also proposed matching a worker to a particular job that suited the person’s skill level and then training the worker to do that job in a specific way. Taylor first developed the idea of breaking down each job into component parts and timing each part to determine the most efficient method of working. Soon afterward, two management theorists, Frank and Lillian Gilbreth, came up with the idea of filming workers to analyze their motions. Their ideas have since been combined into one process (called time and motion studies) for analyzing the most productive way to complete a task. Scientific management has at its heart four core principles that also apply to organizations today. They include the following:
Taylor designed his approach for use in places where the work could be quantified, systemized, and standardized, such as in factories. In scientific management, there is one right way to do a task; workers were not encouraged (in fact, they were forbidden) to make decisions or evaluate actions that might produce a better result. Taylor was concerned about the output more than worker satisfaction or motivation. Taylor’s work introduced for the first time the idea of systematic training and selection, and it encouraged business owners to work with employees to increase productivity and efficiency. And he introduced a “first-class worker” concept to set the standard for what a worker should be able to produce in a set period of time. Scientific management grew in popularity among big businesses because productivity rose, proving that it worked. Today, an updated version of his original theory is used by such companies as FedEx and Amazon. Digital Taylorism is based on maximizing efficiency by standardizing the tools and techniques for completing each task involved with a given job. Every task is broken down to the smallest motion and translated into an exact procedure that must be followed to complete that task. Because everyone is operating in the same mechanistic way, it increases predictability and consistency while reducing errors. It is relatively easy for managers to replace workers and retain the same productivity. The criticism of this type of management approach is similar to that of Taylor’s original theory: It reduces worker creativity; it requires management to monitor all aspects of employee behavior; and it is unforgiving to workers who don’t meet the standard. Frank and Lillian GilbrethTwo more pioneers in the field of management theory were Frank and Lillian Gilbreth, who conducted research about the same time as Taylor. Like Taylor, the Gilbreths were interested in worker productivity, specifically how movement and motion affected efficiency. Lillian Gilbreth. The book and film Cheaper By the Dozen were based on her and Frank’s experiences raising twelve children according to their theories of time and motion studies. As stated above, the Gilbreths used films to analyze worker activity. They would break the tasks into discrete elements and movements and record the time it took to complete one element. In this way, they were able to predict the most efficient workflow for a particular job. The films the Gilbreths made were also useful for creating training videos to instruct employees in how to work productively. Taylor and the Gilbreths belonged to the classical school of management, which emphasized increasing worker productivity by scientific analysis. They differed, however, on the importance of the worker. Taylor’s emphasis was on profitability and productivity; the Gilbreths were also focused on worker welfare and motivation. They believed that by reducing the amount of motions associated with a particular task, they could also increase the worker’s well-being. Their research, along with Taylor’s, provided many important principles later incorporated into quality assurance and quality control programs begun in the 1920s and 1930s. Eventually, their work led to the science of ergonomics and industrial psychology. (Ergonomics is the scientific discipline concerned with understanding the interactions of humans with other elements of a system.) You can watch some of the Gilbreths’ films below to get an idea of how they documented their time and motion studies in an effort to increase efficiency and safety.
Henry GanttHenry Gantt (1861–1919) was also an associate of Taylor. He is probably best known for two key contributions to classical management theory: the Gantt chart and the task and bonus system. The Gantt chart is a tool that provides a visual (graphic) representation of what occurs over the course of a project. The focus of the chart is the sequential performance of tasks that make up a project. It identifies key tasks, assigns an estimated time to complete the task, and determines a starting date for each element of a task. Gantt differentiated between a terminal element that must be completed as part of a larger task. The related terminal elements together created what he called the summary element. An example of a simple Gantt chart The Gantt chart has multiple benefits for project management:
Let’s apply the Gantt chart principles to a simple project. Imagine that you want to paint a room. The summary element is the finished, painted room. The individual terminal tasks might include calculating the square footage of the room, preparing the walls, choosing the paint, purchasing the paint, putting down the drop cloth, taping the windows, applying the paint, and final cleanup. Some of these elements are independent, and some elements are dependent upon others. Purchasing the paint is dependent upon knowing the square footage and choosing the paint color. Before painting can start, the walls must be prepared and the paint must be purchased. But purchasing the paint is not dependent upon preparing the walls—these tasks could be started at the same time. There are several distinct tasks involved in painting a room. Gantt also promoted the task and bonus plan that modified Taylor’s “a fair day’s pay for a fair day’s work” premise. Gantt wanted to establish a standard (average) time for a piece of work or task. Then, if a worker took more that the standard time, his pay was docked. But if he took less time, he was paid for the additional pieces of work and a bonus of up to 20 percent more. Also known as the progressive rate system, this plan was preferred by workers who were willing to work harder for additional wages. Although Gantt is not the best known of the classic management theorists, many of his ideas are still being used in project management. Key PointsScientific management was the first widespread promotion of rational processes to improve efficiency. The goal was to develop a standard against which work performance could be measured. Training became an important part of the management process. By the 1930s, however, many unions and workers were suspicious of the intentions of scientific management. Who suggested profitIn the West it was introduced by American politician Albert Gallatin on his glass works in the 1790s, but the modern type of profit-sharing plans was developed later in the 19th century. William Cooper Procter established a profit-sharing plan in Procter & Gamble in 1887.
What is profitProfit sharing is a type of pre-tax contribution plan for employees that gives workers a certain amount of a company's profits. The profit-sharing payments depend on the: Business's profitability. Employee's regular wages and bonuses. Amount set by the business.
What is the purpose of a profitA profit-sharing plan is a retirement plan that allows an employer or company owner to share the profits in the business, up to 25 percent of the company's payroll, with the firm's employees. The employer can decide how much to set aside each year, and any size employer can use the plan.
What is profitprofit sharing, system by which employees are paid a share of the net profits of the company that employs them, in accordance with a written formula defined in advance. Such payments, which may vary according to salary or wage, are distinct from and additional to regular earnings.
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