Study The Incentives Of Managers Of State-owned Enterprises In China

As a thesis on the motivation mechanism of our state-owned enterprisemanagers, this article concentrates, from the perspective of earningmotivation system, on the overall analysis of motivation condition ofstate-owned enterprise managers. Meanwhile, according to the chronologicalorder of reform and open-door process, it reviews the selection andappointment of enterprise managers. Finally, it comes to the conclusion that avast majority of state-owned enterprises haven't developed the efficient andwell-established manager motivation mechanism. On the basis of the aboveanalysis, the article also highlights the study of five main motivation modelsof state-owned enterprise managers: the annual salary system, personnel'sshareholding, management buy-out, stock options and stock appreciation right,and focuses on the research into their basic concepts, operation processes, keyoperations and comparison of advantages and disadvantages. Then, inconsideration of the relevant cases, it probes into the common problems ofthese motivation models when they are used in the specific applicationenvironments, and suggests some definite and feasible solutions.The article is divided into three chapters. The first chapter reviews thestatus quo and problems of Chinese state-owned enterprise managermotivation mechanism in the course of reform and opening to the outside.Since the reform and open-door policy was adopted in 1978, the majorexecutives of state-owned enterprises have received quite low salaries for aconsiderable period of time, and their values and contributions to theenterprises have not been properly materialized against the unfavorablecondition that the salary structure remains misbalanced and the selection andpromotion are conducted in an unfair manner. As the state-owned enterprisesgrow and expand, the motivation mechanism fails to develop accordingly. Ithasn't functioned as an effective motivation method, but instead provided afavorable condition for the corruption, the irrational post-based consumptionand the abuse of power for personal gains. As a result, the "59-year-oldphenomena" have never ceased to occur. The motivation mechanism ofstate-owned enterprise managers shall be improved without any delay! Thesecond chapter in this article expounds the concepts and relevantimplementation rules of other four motivation models with the annual salarysystem and the equity motivation as a focus. The third chapter starts from theperspective of practice use to analyze the specific application environment,precautions, possible problems and solutions of five motivation models, andalso chooses the relevant cases from the materials publicly reported in themedia to support its arguments.