Laney Liu started a discussion

[Compensation] Pay-by-User

Networked enterprise compensation concept: From pay-by-enterprise to pay-by-user
Haier's model overturns the traditional compensation system: Intraditional enterprises, staff receive payment based on position and job grade. Employees execute orders from superiors who evaluate their performance, and receive pay from the enterprise. The compensation system of a networked enterprise developed by Haier is pay-by-user, where employees create value for users who, in turn, evaluate the value. The compensation then comes from extra profit sharing. The traditional compensation system is a fixed compensation system with ex-post evaluation. Haier compensation system adopts VAM pay related to user value, which requires commitment-oriented planning. The resource investment for creating user value depends on VAM and co-investment
instead of allocation by superiors. The microenterprise takes the initial risk, and pays employees their co-investment capital first if it fails to create value for users and the VAM comes to nothing.

3 June 2021 : 04:11 am


Leave a comment

If you want to share something you need create an account. It only takes 1 minute and it is completely free.

Join - it's free! Already an account?