Flatter Pyramid
Ralph Waldo Emerson once said that “what lies behind you and what lies in front of you, pales in comparison to what lies inside of you” – this could not be any truer with regards to a corporation. Lee Valley Tools has decided to narrow the spectrum of corporate executives’ salary and the salary of a relatively low-entry job. Leonard Lee, the founder of Lee Valley Tools has adopted a spectrum of 10:1 with respect to highest-paid worker and the lowest-paid worker. Corporate culture often defines power measured by salary, but Lee Valley Tools challenges this status quo. When the highest-paid worker receives only 10x more than the lowest-paid worker, Lee states that “[they] get tremendous loyalty from employees” (qtd. in Grant). With respect to Emerson’s quote, the past recession, profit losses, loss in market share, etc. hardly exist as a threat to the organizational culture within. Likewise, future profit projections, or financial goals compare very minutely to the corporate culture. All of these past and future failures, successes, goals, and challenges all exist to shape the corporate culture and in order to recover from past failures, and to ready for future successes, the corporate culture must be harmonious. Certain organizations like Lee Valley Tools, Whole Foods Corp, Costco, and the company covered in class – Zappos – have adopted this method of having corporate executives receive a drastically low pay. However, this remains beneficial because employees feel needed, respected, and connected, which improves the working environment allowing for increased efficiency and productivity which ultimately converts to profit.
References:
http://www.activelivingzoomers.com/in-praise-of-lee-valley-tools/