logo image

Gainsharing and profitsharing are not the same things Essay

Very often people mix up the concepts of gainsharing and profitsharing thinking those are the same things. Yet, this is a mistaken conviction, since the above mention phenomena though have a lot in common, but still have to be differed from one another.

Profit is an economic term, which refers to the sum of money that remains after all the expenses are subtracted. Gross profit does include taxes, while net profit doesn’t. Simply saying, profit is an economic category that shows the functional effectiveness of an enterprise. Profit is always represented in accounting documents and is material category, which can be easily calculated. The best example of profitsharing is bonuses, which employees get depending on their contribution to the overall performance or specific project. Profitsharing is strictly referred to financial (material) assumption.

Gains are much broader category, which contains both material and immaterial things like goodwill, reputation, brand name, popularity etc. Gains are everything that improves firms status, image, financial stability. For example, good image of the company substantially facilitates for its employees the process of potential customers and partners attraction and involvement into business, since the latter already trust this firm as the player with strong reputation ad principles. Strong reputation,

Need essay sample on "Gainsharing and profitsharing are not the same things"? We will write a custom essay sample specifically for you for only $ 13.90/page

in turn, might increase the value of the company and subsequently reflect positively on company’s share prices. The latter not only strengthen enterprises financial stability and reflect on higher share dividends.

In such a way, the difference between profitsharing and gainsharing is quite clear and obvious. The former is referred to some monetary basis that employees get usually at the end of certain financial period. The latter can also possess immaterial character and be expressed in such categories as better reputation, stronger brand, enhanced trust and sound popularity. Ultimately, the gainsharing might not reflect in accounting documents while profit always does.

References

Dosi G. (2001) “The nature and dynamics of organizational capabilities” Oxford University Press, Oxford, England

Can’t wait to take that assignment burden offyour shoulders?

Let us know what it is and we will show you how it can be done!
×
Sorry, but copying text is forbidden on this website. If you need this or any other sample, please register

Already on Businessays? Login here

No, thanks. I prefer suffering on my own
Sorry, but copying text is forbidden on this website. If you need this or any other sample register now and get a free access to all papers, carefully proofread and edited by our experts.
Sign in / Sign up
No, thanks. I prefer suffering on my own
Not quite the topic you need?
We would be happy to write it
Join and witness the magic
Service Open At All Times
|
Complete Buyer Protection
|
Plagiarism-Free Writing

Emily from Businessays

Hi there, would you like to get such a paper? How about receiving a customized one? Check it out https://goo.gl/chNgQy

We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy