Skyline Construction Case Study Help Analysis With Solution

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Workers at Skyline Construction Choose Own Mix of Salary and Bonus
Mark Trento and Adam Chelini had a rare opportunity last year. They got to pick their own salaries, in a range between $125,000 and $150,000. The catch: Choosing a lower salary meant a shot at a larger bonus. Trento, a vicepresident for San Francisco-based Skyline Construction Inc., chose the safety of $150,000…
Hayes says the plan fits well with Skyline’s culture, which focuses on open-book management and employee ownership. “Owners get more reward for taking risk,” he says. “That’s business, and that’s the entrepreneurial spirit that we are seeking to capture.”
Case Questions
1. Why might being given some choice in the mix of guaranteed salary and bonus be motivational?
2. What kind of motivational problem might Skyline senior managers have in a year when the company did not generate a profit?

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3. What does the analogy “skin in the game” imply from a motivational standpoint?
4. Given the opportunity, what mix of salary and bonus would you choose? Why?

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