Case Study

Incentive Design

Gain-Sharing in the Apparel Industry

Praxis Consulting Group was engaged by a leading manufacturer in the apparel industry to assist them in developing a customized gain-sharing variable pay plan that would serve to support a strategy of cooperatively and flexibly moving work among their the North American Customer Service Centers (CSC’s). In addition, the gain-sharing initiative was intended to enable leadership to live up to its commitment to the workforce to increase earning opportunities and to be self-funded from measurable improvements in productivity and/or reductions in operating expenses. The plan also needed be easy to administer, easily understood by the workforce, and developed through workforce engagement.

Goals of Engagement

Obtain information regarding site leadership readiness to support a variable pay plan that recognizes and rewards improved performance based on CSC network wide performance
Begin a dialogue that served as a foundation of a robust and systematic communication and education effort in support of the variable pay plan
Begin the development of local subject matter experts who would support, help sell and have ongoing involvement in the variable pay plan
Develop a deep understanding of the opportunities for measurable improvement within the CSC’s
Develop a deep understanding of the capabilities of local systems to support the data collection and reporting requirements of a variable pay plan that was self-funded through improvement
Evaluate each sites cultural readiness to support the workforce engagement, problem-solving and improvement systems required to support the variable pay plan.

Results

In collaboration with the client’s Gain-sharing Task Force (GTF), developed several versions of a variable pay plan for testing against required outcomes
Designed and adopted a comprehensive communication and education plan to concurrently roll out with the implementation of the pay plan.
Worked closely with divisional management leadership during the design process to constantly adjust the variable pay plan to meet rapidly changing market conditions as a result of the most serious economic downturn experienced in the apparel retail sector since the 1930’s
Successfully launched the roll out of the variable pay plan in the 4th quarter of 2009
Organization Type
Corporate, Retail Apparel
Number of Employees
5400
Client Since
2008
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