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Benefits and Quality

Chart depicting how incentive structures of motivated and unmotivated companies improve work quality.
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Companies with the highest motivation to improve quality are the most committed to treating their employees well, according to an Ernst & Young survey of more than 200 small companies. The greatest disparity between motivated and unmotivated companies is in the number offering 401(k) plans, with or without matching by the employer. Of the companies committed to quality improvement, 74% offer some kind of 401(k) plan, whereas only 46% of companies judged unmotivated offer one.

Type of compensation or benefit offered % of companies motivated to improve quality % of companies unmotivated toimprove quality
Base salary 96% 95%
Bonus/incentive pay 94 89
401(k) with some matching 47 36
Equity incentive 41 34
Employment agreement/contract 35 27
Defined-benefit pension plan 29 20
Defined-contribution retirement plan 21 13
401(k) with no matching 27 10
Nonqualified deferred-compensation retirement plan 11 18

Source: Ernst & Young survey of 259 members of the Institute of American Entrepreneurs, Dallas, May 1992.




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