One of my EOS clients became an ESOP last year. Their CEO, Mike Beck, has given this book to everyone in his company. Thanks for recommending it Mike.
In the Great Game of Business Jack Stack provides a primer for managing any size company, including overarching principles and detailed actions. All small business owners should read this book. If you run an ESOP, it probably should be mandatory.
Springfield Remanufacturing Company (SRC) of Springfield, MO, was created when Jack Stack and a few other managers bought a failing division of International Harvester in 1983. Today SRC is a $400M ESOP, which has founded and funds 35 smaller entities begun by ex employees of SRC.
Stack advocates that if business leaders focus on what he believes is the only solution to the social ills of all 1st world counties – creating jobs – they can make a difference in their own futures, the futures of their own progeny, and the futures of all the citizens touched by their company.
His prescription is two fold. First educate all your employees on how to play the great game of business – teach them how to understand what it takes to run a successful business. SRC shares the details of their balance sheet and income statement weekly with all managers and anyone else who wants to attend the meeting. Then give them a voice in running the business directly tied to their own future success by enabling them to share in the equity of the business.
Everyone who reads the book will take away different nuggets of wisdom. In my case I particularly like the bonus program in use at SRC. You can read about it in Chapter 7 of the book, entitled “Skip the Praise – Give Us the Raise”. The phrase is abbreviated “STP-GUTR” and is pronounced Stop Gooter.
Stop Gooter is open to all employees after a year on the job. It is paid out quarterly (10%, 20%, 30%, 40% in Q1 through Q4) with any unearned part of one quarter rolling over into the next quarter, insuring motivation for the entire year. It also is based on both balance sheet (the current ratio is an example) and income statement (almost always pre-tax margins at SRC) results so as to assure balanced decision making for the long term good of SRC.
Jack Stack is a realist. He does not believe one size fits all, but he does believe that all companies are better off with an educated and informed workforce. The results speak for themselves.
The data is a bit dated; the book was last updated in 1993 I believe. But the principles and ideas are timeless.You can buy the book here on Amazon.
Photo Credit: Amazon