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Huawei: A Case Study of When Profit Sharing Works

Harvard Business Review

At Huawei’s inception, Zhengfei designed the Employee Stock Ownership Plan (ESOP). At the time, Zhengfei had no idea what a stock option system was – not being familiar at that time with the types of incentives systems developed in the West. The structure of the ESOP is based on two important premises.

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Treat Employees Like Business Owners

Harvard Business Review

And companies — except for the very smallest — can implement an employee stock ownership plan (ESOP), often funded through borrowing. Then, last summer, they launched an initiative to reduce COGS, cutting food waste, reconfiguring some dishes, and coming up with ways to operate more efficiently.

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