The Role of Employee Ownership in the Total Rewards Strategy

Abstract

Employee ownership of organizations can promote motivation to contribute to the success of those organizations. “Ownership” can be economic and/or psychological and both forms align the interests of employees and the organizations. The benefits of psychological ownership can be realized by ensuring that employees understand what the organization needs and managing in a manner that convinces them they will be positively affected by success. Economic ownership must provide benefits in the form of tangible results that outweigh the costs of making employees owners. Each organization must determine the role that economic ownership should play in its rewards strategy based on a cost–benefit analysis.