New Distribution Core: Unite the team, activate the team Mechanism Example 1: Profit-Sharing Mechanism 1. Profit-Sharing Mechanism (All-Employee Profit Sharing): Compare the total bonuses, red envelopes, and benefits distributed last year with last year's sales. Assume it's 1%. Distribute cash monthly, at a rate of 1% of sales. For example: If last month's turnover was 600,000, as long as each month exceeds this amount, distribute the excess to everyone. 2. Core of Profit-Sharing: Distributing Future Money
All-employee profit sharing, daily, for everyone.
Those with significant contributions share monthly.
Core senior management shares annually. Wisdom: Positive energy, aligned direction. Profit-sharing allocation must be available to everyone. For example: monthly, quarterly, annually. 3. The more people you can get to care, the greater the business you can achieve. A person cares only about what is related to them.
- Core
A. Only share present and future, not past.
B. The company wants employees to care about something; make it relevant to them.
C. The company wants employees to care about a specific area; create relevance there.
- Channels
A. Improve performance
B. Reduce costs
C. Increase capacity (efficiency)
- Operation Take all-employee profit sharing with monthly distribution as an example:
A. Set a baseline each month.
B. Distribute a certain profit ratio for amounts exceeding the baseline.
C. Distribute monthly, everyone gets a share. 4. Two Distribution Methods: A. The company only provides the money, not the distribution.
B. Each person's monthly share = (individual monthly salary / total company monthly salary) × company monthly profit-sharing amount. How to activate frontline employees and ignite their motivation? A wise organization gives more than 40% of benefits, policies, interests, and conveniences to frontline employees, such as all-employee profit sharing. 5. Three Principles for Generating Profit-Sharing Mechanisms Principle 1: Relevance
How many people are related to the desired "result"? Who is related? What is the relationship? How much relationship? (Establish profit-sharing based on that result.)
Principle 2: Human Nature
People, especially Chinese, share a common trait: I do what benefits me.
Principle 3: Position
Business leaders must always know where the company wants to achieve results and establish profit-sharing mechanisms there. 6. Wisdom of Profit-Sharing Distribution:
Wisdom 1: All frontline employees participate in profit sharing (coefficients based on position and individual contribution).
Middle and senior management do not participate.
Wisdom 2: The lifeblood of profit sharing
Where you want employees to care, create relevance (profit sharing) there.
How many employees you want to care, create relevance (profit sharing) for that many.
The more people you can get to care, the stronger your team.
Caring only happens when it's related to them.
Wisdom 3: About the profit-sharing cycle
The shorter the cycle, the better, based on the company's production and payment cycles.
Wisdom 4: About the profit-sharing plan
Initially, the boss decides, and everyone discusses together.
According to the rhythm, those involved attend meetings, decide together, and the boss only participates in discussion, sets the tone, and provides the profit-sharing ratio. Mechanism Example 2: Betting Mechanism 1. Betting
Betting is about becoming true partners with the boss, cooperating with the boss.
Betting is about our creativity.
Betting is about our potential.
Through betting, we ignite ourselves.
Where money is, the heart is.
Betting is about our future. Betting cycle: 1-3 months. Recommended not to exceed 3 months. 2. Betting Items:
Increase in performance
Improvement in efficiency
Savings in expenses
Number of store openings
Payment collection 3. Betting Stages: Stage 1: Bet on what the team finds easy. Stage 2: Bet on what the company's strategic development needs. 4. Betting Distribution Method: Extra created and extra saved are distributed after negotiating with the boss. During distribution, we grow the company and increase employee income. Distribution ratio is based on investment ratio (determined by contribution to the betting plan).
Betting
Implementation schedule PK for betting plan design. Top three fastest get cash rewards. 5. Betting Mechanism
Setting up the bet:
Participants must have hope.
The upper limit of returns must be several times greater than the investment.
Must be voluntary.
Must self-fund the bet.
Must be paid in full and on time.
- Core operation:
A. Benefits (indicators)
B. Bet amount
C. Payout
- Purpose of betting:
A. Activate the team during the process.
B. Train all members to become independent.
C. Increase organizational cohesion and generate wisdom.
- Key points:
A. Set a performance target that is barely achievable with effort as the betting standard (if it's obviously winnable, it's deception).
B. Conduct comprehensive data analysis.
Industry trends, product trends, seasonal trends, company trends, team trends, market trends.
C. Leadership leads the team to jointly develop sales channels, strategies, and promotions, guiding them to win. Mechanism Example 3: Internal Marketization Mechanism (Internal Automated Operation Mechanism) The biggest cost for a company is internal friction. 1. Deeply Experience the Internal Marketization Mechanism A. Marketization Like the state of the marketing department serving customers. B. Current Company Situation
- Departments have collaboration rules but cannot implement them.
- Semi-marketized, semi-feudal ("Emperor" arrives).
- Specific reasons: For example, in the distribution mechanism: management positions' salaries are not related to company performance (sales, gross profit, net profit). For example, in the management mechanism: management department cadres' assessments and promotions are not related to other employees, only decided by the boss or HR. C. Use internal marketization to solve:
- Each department must find its internal customers. For example: Whoever receives my products and services is my customer. For example: The next process is the customer of the previous process. For example: Whoever is closest to market customers is the major customer.
- Serve internal customers as you would external customers.
- Use customers to assess and promote. For example: Purchasing manager—purchasing gross profit ranks top three in the company; assessed by sales managers and employees; assessed by purchasing employees; boss reviews and signs.
- Salary directly linked to workload of serving internal customers.
- For companies with mature conditions, implement contractual management between departments, with clear terms, cash on delivery, and an internal banking-like mechanism. 2. Internal Customer Mechanism Key points:
- Each department must find its customers (mutual customers). For example: Kitchen—front of house. (So-called customers are those with whom I have a relationship; we are mutual customers.)
- Departments that are mutual customers generate ideas together and can make demands on each other.
- Must reach consensus.
- Must clarify what happens if not completed.
- Sign and seal.
- At least once a month. To use this thinking well, you must satisfy: A. Believe you are wise. B. Sincerely want to do things well. C. Find a pilot. 3. Internal Customer Theory:
- Each department finds its internal customers (if it can't find them, the department is automatically canceled). Wisdom for finding customers: Follow the vine to find the melon. The melon is the market customer. Whoever is closest to external market customers is the core internal customer, and use this as the melon to push forward.
- Service standards: Serve internal customers as the marketing department serves customers. All employees set service processes and requirements. All employees set punishment mechanisms. All employees sign and seal, and finance keeps records.
- Use direct or indirect customer departments to assess the department's income and promotion. In a company, if an employee's income exceeds the industry average by 20%, staff is basically stable; by 50%, employees work very hard; by 100%, employees work desperately. 4. Internal Operation Mechanism (Tasks)
- The ideal state: internal (absolute) marketization.
- The first resource is human resources; internal friction is the biggest cost (not visible in financial books).
- Treat each department as an independent company, with customer relationships between them.
- The sales department asks other departments what requirements they have for it.
- Clarify each item, the more detailed the better.
- The boss gives these departments a permission and score value (if production and sales cooperate more, production can have a higher score).
- The score for each item is based on its importance.
- Show all requirements written by each department to the sales department; after agreement, sign. At month-end salary, any unmet item (must be notified immediately, crossed out) is deducted from the total score.
- If any item is inappropriate or missing at month-end, it can be modified or supplemented, but must be agreed by the parties involved.
- For requirements proposed by the sales department, the sales department is responsible; for those not proposed, the department itself is responsible.
- Other departments follow the same process.
- First assess each department, then after smooth operation, assess each position.
- This assessment method can be linked to stock options and profit-sharing mechanisms.
- Assess coordination ability, not job-specific ability.
- Don't simplify democracy and centralism.
- If a person cannot cooperate with others, no matter how capable, it's useless. Mechanism Example 4: Position Compensation Mechanism In summary, the core of the compensation system: disparity. Perception 1: Without a 50-fold disparity, how can there be a 50-fold pull? The greater the disparity, the greater the pull. Perception 2: The difference in ability should be reflected in the difference in compensation. Perception 3: Since 80% of performance comes from 20% of top employees, that 20% should receive 80% of the performance profit. Reasonable and fair doesn't mean similar income; it means the more capable you are, the more you earn. Talented people prefer such systems. An effective compensation system makes the capable rich, the hesitant move, and the idle anxious. That's activation. Disparity itself is marketization. Core of Compensation Mechanism: Hope, Disparity Pricing core: Make it worth buying for others. Pricing wisdom: Make people feel empowered. Compensation system lifeblood: Let some get rich first. The power of role models is infinite. Lottery theory: The top prize is 5 million. If there were 10,000 prizes of 500 yuan, would people still buy frantically? So, the company's development speed depends on the income level of the top few employees. Base salary + commission + seniority + position + allowance + performance + subsidy + year-end bonus + profit sharing + ... (Composed of three parts: fixed + variable + binding) 1. Fixed Part For example: A. Base salary B. Seniority C. Full attendance 2. Variable Part For example: A. Commission B. Profit sharing C. Performance 3. Binding Part For example: A. Year-end bonus Mechanism Example 5: Heavy Reward Mechanism Heavy Reward Thinking Mechanism 1: Ranking Mechanism Different rankings, different treatment forever. Mechanism 2: Effects
- Internal ignition When to use: Use when useful, don't use when not (everything serves me). Use Mechanism 1: Innovation Mechanism Use Mechanism 2: Experiment Mechanism Use Mechanism 3: Idea Mechanism
- How to use: PK Mechanism
- PK with the same industry
- Team vs. team PK
- Target PK
- Self vs. self PK
- Example: By growth rate How to distribute: Six-three-one distribution (according to the 6-3-1 principle):
- Original practice: 60%-----10% 30%-----30% 10%------60%
- Current practice: 60%-----------First place 30%----------Second place 10%---------Third place
- Promotion Mechanism The greatest wisdom is to make children and those around you strong and sacred. Mechanism Example 6: Alliance Mechanism Alliance Mechanism:
- Upstream and downstream alliances
- Same-industry alliances
- Cross-industry alliances In the past, it was the art of planting trees; now it's the art of transplanting together to form a forest. 1. Close Alliance Unified brand, shared resources, independent operation, independent accounting. For example: The EU is like 27 small companies combined into one large company. For example: Mengniu unites small dairy producers, produces uniformly, and goes public together. For example: Home appliance industry Laundry powder industry For example: Supermarkets A, B, C, M (2, 3, 2 stores) (a medium-sized supermarket with 7 branches) Wisdom for close alliance operations:
- This is the result of competition.
- Alliance participants must have a leader.
- Participants must be those who have already "landed" (not short of money, want to build a career in the second half of life).
- Must start with two companies.
- You must become a top player in the industry. A. Top players study how to build careers together. B. Middle players study how to play together. C. Lower players indulge together.
- Clearly define exit and punishment mechanisms. The purpose of a close alliance is to establish a true group company. How to set standards: Ask them. Don't command; manage their willingness. They always love doing what they decide. Only when things are clearly divided can cooperation be pleasant. Divide responsibilities, power, and interests. 2. Semi-Close Alliance: Independent brand, shared resources. Independent operation, independent accounting. A. Same industry: Exchange skills with local or distant peers. B. Different industries: Exchange channels and customer resources. For example: Puma and Ferrari Banks and airlines How to navigate the business world: A. The basic form of market and economy is transaction. B. The essence of transaction is exchange. C. Exchange must be based on equality. Make employees believe in the product; that's the lifeblood. Mechanism Example 7: Recruitment and Retention Mechanism A. Touch employee needs: Why do employees join the company? Why do they leave?
- Are their current needs met? For example: Material needs (salary, food, clothing, housing, transportation) For example: Environmental needs (happiness, comfort, fairness, safety)
- Can they see results, future, and promotion? For example: Career planning, life navigation map, promotion mechanism
- Do they receive recognition, guidance, and development from leaders? B. Who to recruit?
- Recruit those who like the company, boss, industry, team, and culture.
- Recruit employees with high motivation, low resistance, and strong beliefs.
- Recruit those with results, teams, and vibrant vitality. C. Who recruits?
- Those with results recruit.
- Those who like the company and have beliefs recruit.
- Those with good attitude, attractive, and energetic recruit. D. Retention How to retain people? Retain with career, emotion, and compensation. For example: Bole mechanism, Maxima mechanism For example: Game management mechanism—promotion mechanism For example: Employee success rate and turnover rate are linked to supervisor's salary and promotion. Mechanism Example 8: Performance Improvement Mechanism Mechanisms must be related to employee income and promotion. For example: Lottery mechanism (heavy reward mechanism) For example: Betting mechanism (stakes must be taken seriously) For example: Full house mechanism (employees help and supervise each other) For example: Immediate profit-sharing reward mechanism Everyone gets a share, same-day settlement, distributed by salary proportion. ... Mechanism = Relationship The greater the relationship, the greater the care, the greater the motivation. The 3rd (CFIC) China FMCG + Internet Conference will be held in Chongqing in November 2017. The conference will closely focus on the theme "New Forces, New Ecology," inviting 1000+ distributors, 500+ brand owners, 200+ B2B platform founders, and 100+ investment and financing institutions to jointly explore a new chapter of cross-border integration! Core Topics of This Conference:
How can the FMCG industry leverage B2B to achieve new growth opportunities?
How should the new supply chain behind new retail be built?
How can intra-city logistics help B2B achieve leapfrog development? Highlights of This Conference:
The industry's first "2017 China FMCG B2B Industry Competitiveness White Paper"
Case sharing of excellent distributors in transformation and upgrading
Conference + Exhibition upgrade, Hall 6 Internet Technology Exhibition strengthens networking
Alibaba Retail Link, Puhua Finance, Eternal Asia Supply Chain, Best Store Plus, Yijiu Pi, Haiding—leaders from various well-known enterprises will deliver keynote speeches and share pioneering views.
Registration is now open. Long press the QR code below or click "Read Original" to register. Early bird tickets before September 17 enjoy a 30% discount! Add friend with note "Conference Registration" Click the links below to review the highlights of the 1st and 2nd FMCG + Internet Conferences: 2016 "FMCG + Internet" Summit Forum 2017 (2nd) China FMCG + Internet Conference Click the links below to review the highlights of the 1st and 2nd FMCG + Internet Conferences: 2016 "FMCG + Internet" Summit Forum -END-