W.L. Gore & Associates is a company well known for its GORE-TEX fabric for protective outerwear. In 2006, the company ranked fifth on Fortune's list "100 Best Companies to Work For.” It was the eighth year in a row the firm had made the list. One of Gore's hallmarks is innovation. Rather than job titles, bosses, and organization charts, Gore uses a team approach, with leaders, sponsors, and team members.
The goals of Gore's compensation plan are internal fairness and external competitiveness. Gore uses two approaches to achieve these goals. The first is straightforward and typically used by companies: comparing pay at Gore with pay for comparable jobs at other companies. That takes care of the external competitiveness part. It is the internal competitiveness part that is different at Gore. The process works like this: Associates (co-workers) on the same team rank each other based on contributions to the company for the year. Team members can provide comments to support their rankings and identify strengths or areas for improvement of the associates they rank. This information is then used for determining raises.
Answer the following questions by applying the concepts learned in Chapter 10. Also, conduct literature reviews on the subject of discussion and use to support your case study answers:
- Provide a critique of the compensation practices at Gore, indicating the pros and cons of each approach.
- Do you think that Gore can achieve its goals of internal fairness and external competitiveness with the two approaches used?
- Would you want to work for this company? Why or why not?
Compensation At W. L. Gore
GORE-TEX is awarded as one of best companies for many time. The organizational structure is not based on traditional one with bosses, superior and inferiors etc. But there are team members, leaders and sponsors. Gore is achieving competitive to another ones that having higher pay structure and the process of workflow is different. Team members are involved on supporting their ranking and improving the ranks associated.
Compensation practices at Gore
Gore is implementing compensation plan of internal fairness and external fairness that means the compensation is kept fair enough and transparent within the company whereas the pay scale is higher than that of competing organizations. Associates of a team ranks each other's based on their contribution. Other team member provides comments supporting ranking with identification of strength or improvement.
- This approach is more participatory as team members are involved directly on raking team members
- Process is clear and transparent because all information is open to each member of team
- Evaluation by co-workers will give relevant information that ranking done by strangers out of that team
- There might be chance of influencing each other for better ranking
- Compensation scheme open to each other might cause unhealthy competition between employees such that they wish to show more quantitative tasks rather than qualitative
- Each team member being responsible for ranking might misuse the concept to influence each other
Possibility of achieving its goals
Gore is implementing its goal of internal fairness and external competitiveness that is unique on contemporary market. To achieve this company is implementing payment that is competitive on market and team members evaluated based on contributions. The approach of cross evaluation is likely to achieve internal fairness to some extent because evaluation is not done by single. Evaluation done by person out of the team might not know everything about them. Moreover payment of comparatively good will not let labor retention. Team member provide comments supporting ranking to identify strength and weakness for improvement.
Likelihood of joining the company
As stated on given case the company is making comparatively good impression on customers, the structure is fair enough. Each members being responsible for cross evaluation will make feeling of belonging. What I like about that company is lack of traditional bosses and staffs hierarchy. Everyone in the company are equally respected and provided chance to evaluate team members. Thus uniqueness of participation and fairness makes me interested on joining that company.
Not all companies treat employees equally and provide participatory respect. Gore is healthy internally with fair competition and transparency on evaluation where as it is excellent on comparing to other firms too, that led to make this company one of the best eight times.
Lepak, D. &Gowan, M. (2010). Human resource management: Managing employees for competitive advantage. Upper Saddle River, NJ: Pearson/Prentice Hall
Hrcouncil.ca,. (2015). Employee Benefits | Compensation & Benefits | HR Toolkit | hrcouncil.ca. Retrieved 11 October 2015, from http://hrcouncil.ca/hr-toolkit/compensation-employee.cfm