I decide my salary with my colleagues!

Written by Hugo Chatel, on 23 May 2018

After experiencing an initial entrepreneurial failure that affected his family and friends who were investors, Kozo Takei understood the importance of sharing responsibility within a company. More than just a mantra, he wanted his employees to be fully accountable for their activities within the company, including their compensation. But how to allow employees to decide their own compensation?

First and foremost, clear rules are needed. Diamond Media's rules are fourfold:

  • Total transparency is necessary (including salaries and company accounts).
  • Only intrinsic motivation incentives are allowed.
  • Facts are better than opinions.
  • Knowledge sharing is essential.

All interactions and decisions within the company must follow these foundational principles, including decisions about compensation.

"You can't force someone to be happy, but you can create an environment that enables it." - Kozo Takei

To provide a framework for deciding on compensation, Kozo started by implementing a bi-monthly "salary meeting." During this meeting, everyone has the opportunity to request a raise. The only requirement is to justify it based on the value they believe they bring to the company (supported by figures and examples). Indeed, one cannot truly be responsible for their salary without being aware of what it costs the company.

As Kozo admits, egos must be set aside in these discussions. However, a natural solution always emerges because, whatever one might say, salary is ultimately determined by the market price and the value the individual brings to the company. At least... it should be.

However, after a while, employees felt that something was missing to improve their compensation decision-making process. That something was considering all other expenses of the company.

Thus, the bi-monthly meeting transformed into a meeting they call "How to use our money wisely." Now, before discussing salaries, the company's financial experts share the figures from the previous meeting, allowing everyone to better understand the company's financial health and adjust their requests and arguments accordingly.

"I learned the importance of information: data, facts, communication, interpersonal relationships - everything can be considered information." - Kozo Takei