Henry L. Gantt (1861-1919) worked with Frederick Taylor on scientific management experiments over the course of 14 years, before striking out on his own as a management consultant. He originated a unique pay arrangement in which all workers were entitled to a basic daily wage, compared with Taylor's differential piece rate pay system, which paid according to output. In Gantt's task and bonus system, if employees completed their tasks on time they earned a bonus, and if they performed beyond expectations they were again rewarded, as were their supervisors. Gantt wanted to encourage supervisors to coach employees rather than drive them to perform. Productivity doubled in some organizations after management instituted this pay system, reinforcing Gantt's belief that humanitarian management was the key to achieving organizational goals.
More recently, F. Kenneth Iverson, CEO of the steelmaker Nucor, has initiated a base wage system with bonuses tied to productivity. The base hourly wage is about $8, and bonuses are paid on employees' ability to turn out products in less than the standard time.
Employees are very productive and are paid accordingly in an average week, the bonus makes up more than half of a typical employee's paycheck. Another Gantt innovation was a chart to compare actual output to expected output over time, a useful tool for planning and control functions.
More recently, F. Kenneth Iverson, CEO of the steelmaker Nucor, has initiated a base wage system with bonuses tied to productivity. The base hourly wage is about $8, and bonuses are paid on employees' ability to turn out products in less than the standard time.
Employees are very productive and are paid accordingly in an average week, the bonus makes up more than half of a typical employee's paycheck. Another Gantt innovation was a chart to compare actual output to expected output over time, a useful tool for planning and control functions.
