Employees Seeking ‘Ownership’

It has long been believed that payment for a worker’s services should typically consist of a living wage, a few perks and a pension. But today’s talented employees, and managers, aren’t buying that definition. They also would like a “piece of the action.”

In a recent column, I discussed the push by talented managers and key employees for payback that transcends traditional cash-based compensation packages. Following the lead of free-agent sports figures, entertainers, Fortune 500 execs and tech-savvy nerds in Silicon Valley, personnel with exceptional, marketable talents are holding out for the kinds of participation, powers, perks and paybacks that resemble those historically reserved for the business owners.

In essence, they want to share in ownership. And, given the dynamism, sophistication and vulnerability of contemporary economic enterprises, they are increasingly getting what they seek.

The distribution of “ownership” can take many forms. Equity-based signing bonuses in high-tech start-ups, stock-option plans in corporate behemoths, and profit-sharing arrangements with athletes and entertainers have become standard fare. Since the talented, me-centered, independent generation of yuppies has become an influential force in talent-dependent business enterprises, the demand for “ownership entitlements” as a condition of employment is spreading rapidly.

Classic owners are not taking to this enthusiastically. Most still prefer to see a very firm line of demarcation between “capital” and “labor” and the respective - and, in their opinion, decidedly different - entitlements of each.

But sharing ownership can be beneficial to all parties. In fact, the things that ambitious managers want to “take away” from the owners of companies are usually the powers and permissions that could enable them to make the enterprise more competitive, more successful, more profitable and more valuable.

Contemporary managers are asking for the responsibility, authority and rewards that will let them do their best for the enterprise, for themselves, and for the owners who employ them. This emerging manager-owner paradigm promises to convert the feared “take aways” into far greater “paybacks” for all concerned.

Inevitably, the roles of “manager” and “owner” will continue to meld as we move into the new millennium and see the “information age” give way to the “bio age,” where the human element will increasingly take precedence over institutional interests. The critical contributions of capable, contemporary managers will give them the clout to demand even more of the prerogatives of ownership.

These enlightened individuals will seek not only tangible economic benefits but want to participate in the control of the institution and in the forging of its contributions to economic society. Indeed, the concept of ownership, itself, is changing, independent of any formal concessions by “traditional” owners.

Workers are beginning to see that they are already owners, in that they posses important personal resources. A manager’s knowledge, experience, and talents are his personal “equity.” In reality, each worker is a free-agent with unique abilities that he or she can refine and “monetize.” These are individually-owned talents, the value of which can be enhanced through learning, experience and reflection.

Importantly, there is an increasing number of ways in which workers can cash in on these talents. For example, many individuals who heretofore might have unthinkingly snuggled into a career track in a large company are choosing instead to preserve total ownership of their talents - in their own business enterprise - and sell their abilities as a vendor to the company that, under classic circumstances, might have been their employer.

They believe that this arm’s-length supplier-consumer relationship gives them the best immediate monetary return and the control they need to continue to refine the talent they are selling. This approach is obviously growing in popularity. Over 850,000 new business are formed each year. Still others are opting for alliances with temporary help firms or agencies that lease managers to firms on an ad hoc basis. Once again, the ultimate owner of the talent has the opportunity to preserve complete freedom to nurture his talent while still holding out for the best price it can command.