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Awarding bonuses to employees who recruit new people has been an effective management ploy since the days of the Model T, but these days you may do better if you also give them a shot at winning, say, a brand-new Mercedes-Benz 190E. That's how Boston-based Fidelity Investments keeps employees focused on the recruitment process, and it has helped the growing financial-services company save hundreds of thousands of dollars in employment-agency fees.

Fidelity's data-processing division began using employees as recruiters in 1985, with a program that offered employee sponsors $2,000 for each recruitee remaining on the payroll after one year. Under this system, the division brought in 73 new workers in 1986 at a cost of $97,000 -- a lot to give away, perhaps, but only a fraction of the 20%-of-salary fee that employment agencies would have charged. Recognizing, however, that employee attention might wane despite the lure of easy money, Fidelity threw in the additional incentive of the $30,000 Benz, to be raffled off among successful employee recruiters.

And what does Fidelity get in return? Employees who are more reliable, more loyal, and less likely to quit, according to Kevin Mahoney, manager of human resources. "You don't recommend someone who isn't good when you know you're going to work with him." As for the new hires, they have an easier time fitting in, since they already have connections on the staff.