The concept of fluid shares
was coined by Jonar Nader
in his book How to lose friends and infuriate people
. The fluid share program, designed to start a "chain-reaction" in underperforming companies, involves four steps:
- The average salary in the company (from general manager to receptionist) is calculated, and assigned to every employee.
- A generous portion of the net profit of the company — for example, ten percent — is distributed amongst the employees at the end of each month.
- An education campaign is begun, to teach people about the effort required to generate a dollar of net profit after tax.
- Targeted cost-reduction goals.
As Nader predicted in his book, the idea has been widely derided by critics, and labelled as Marxist. However critics often ignore vital implications of the scheme, such as increased pressure for all employees to put in the same high level of effort, and to reduce headcount.
Fluid shares have been implemented, but in some cases with a small salary difference (eg. US$5,000 between the top and bottom of the organisation).