article thumbnail

Huawei: A Case Study of When Profit Sharing Works

Harvard Business Review

At Huawei’s inception, Zhengfei designed the Employee Stock Ownership Plan (ESOP). The structure of the ESOP is based on two important premises. Huawei’s ESOP can satisfy both human needs. For its part, Huawei’s internal policy is to use U.S. law as the guiding law in their international business.).

article thumbnail

Treat Employees Like Business Owners

Harvard Business Review

And companies — except for the very smallest — can implement an employee stock ownership plan (ESOP), often funded through borrowing. Then, last summer, they launched an initiative to reduce COGS, cutting food waste, reconfiguring some dishes, and coming up with ways to operate more efficiently.

ESOP 8
Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

More than One Way to Organize a Business

Thin Difference

Instead of operating top-down, power is distributed throughout the organization, giving individuals and teams more freedom to self-manage, while staying aligned to the organization’s purpose. More information is available at the Democracy at Work Institute and the International Co-operative Alliance. Key Elements of Holacracy.

article thumbnail

Why the U.S. Needs More Worker-Owned Companies

Harvard Business Review

On their own merits, worker-owned businesses can show policy makers, investors, managers, and advisers that companies with democratic ownership values and structures are operated with the same profit motivation as other companies. ESOPs typically allocate shares to employees in proportion to their pay.

ESOP 13