The State-owned Enterprise Research, Incentive And Restraint Mechanisms

There lies in dual deficiency of the Mechanism of Inspiration and Restriction in Chisese SOE(state-owned enterprises) managers. The System of Annual salary, Stock-holding and Stock Options Plan for managers, which are in practice now in our country and have already played an important role in western countries, have many malpractices, so we must probe into and build up a sort of these meachanisms for our managers. "The Method of Value Reward" proposed by the author is just of one these useful mechanisms. It combines the managcn's value with their real contribution to the enterprises, and also has long-term effect on the managers.This paper consists of four chapters:Chapter One: the present situation of the Mechanism of Inspiration and Restriction for Chinese SOE managers.Firstly, the author looks back on the history of Inspiration and Restriction in China, then he points out some problems lying in it, and so analyses briefly the cause of these problems.Chapter Two: the Mechanism of Inspiration and Restriction for managers in western countries (characterized by the U.S enterprises)In this chapter, the author broadens his vision to the outside, analying the managers' inspirational thinking in western countries and the methods and ways they adopting. And he puts attention mostly on the situations of Stock Options Plan in those countries.Chapter Three: the Mechanism of Inspiration and Restriction which is now being made experiment in China and its deficiency.At first, the author analyses the system of Annual salary and Stock-holding in China and their respective drawbacks, then he gives a clear analysis on the Stock Options Plan for managers in western countries, and finally he points out profoundly the obstacles which prevent the development of Stock Options Plan in our countryChapter Four: Try to probe into and build up a sort of mechanism which is appropriate to the condition of China.Form the foregoing context, we can see that there are many problems in the present mechanisms, and they are hard to be solved. So we must try our best to find out a practical way. After expounding the principles for probing into a new mechanism, the author presents a useful way-the Method of Value Reward- to be the creative Mechanism for our managers.