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The company which I work for has a program whereby employees may propose new innovations/ideas for an incentive.

I have never submitted anything nor heard of anybody who has. So I do not know what kind of incentives they offer. At this point I'd like some advice first before approaching them.

Notes:

  • We do have Intellectual Property clauses in our contracts.

  • This employer has screwed me over before.

I have an idea which may (or may not) be lucrative. Considering that my employer is currently exploiting me financially, I am reluctant to share ideas or otherwise help them for free. I insist on being rewarded with a profit share of the prospective project for our whole team. I am also weary of trusting them to honour such an agreement.

Another concern is that if I sit on the idea too long, somebody else will eventually think of it and I'll be simple instructed to do it. And I won't be rewarded because it would then just be part of my job.

My conundrum is:

How do I propose the idea, whilst ensuring that they honour the agreement to give us a profit share and not just steal my idea?

Edit: Excerpts from the HR policy

Definition of an Innovation

An innovation can be a new product, a new product set, a new distribution or OEM vendor, or a newly integrated solution or application, a new or revised process, a new line of business, the condition being that the newness is related to its nature, its composition, its target market, its application, or the commercial models through which it is deployed, or a combination of these things. Where the word "product" is used, it includes services in any form.

Qualifying Innovations

The following solutions qualify for the incentive:

  • New innovations directly applicable to the current area(s) of business of company X
  • New innovations related to the current area(s) of business of company X
  • New innovations unrelated to current area(s) of business of company X, but with the potential to complement or enhance company X from an overall solution offering portfolio, a profitability or viability perspective of from an organisational effectiveness perspective.

Eligibility for Incentive Bonus pay-out

To receive the bonus

  • The qualifying employee should have originated the qualifying innovation idea on the relevant online forum provided.
  • The solution must have been in principle approved for implementation, i.e. it must have approved for further consideration by the company X Innovation Forum.

Edit: Update

I have noticed further down their policy that they offer a flat once-off bonus of R10000 per accepted proposal. Not good enough. And they are stingy and inflexible in their remuneration policies - that's why I am so negative in the first place.

The idea is specific to this company so I would not be able to use it own my own. I have already decided to leave here and am in the process of interviewing already. But I do not want to rush into another job that makes me miserable just for money. So I'm patiently looking for the right opportunity.

In the meantime I thought I could maybe make the most of my remaining time here by floating my ideas.

I wish I could accept everyone's answer as they are all helpful and applicable. Thank you.

I have decided to rather keep my mouth shut for now. I'll start implementing it quietly on the side, it'll be a good learning experience for me either way, and then I'll show them the results and say: "Like what you see? What's it worth to you?"

  • is this program somehow documented? if so does the documentation reads something about the kind of the incentive is offered? – LaughU Jun 28 '18 at 6:18
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    If somebody else is going to think of this idea, it's not good enough to get a profit share. – Philip Kendall Jun 28 '18 at 6:28
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    Are you sure your contract doesn't contain a clause that says something like 'all intellectual property you generate as a part of working for <company> belongs to <company>'? IANAL, but it's a pretty standard clause and if it's in your contract, I'm pretty sure this isn't a case of anyone 'stealing' your idea: it's theirs in the first place unless you thought of it completely without using any of your knowledge you use and gain from your work. – Cronax Jun 28 '18 at 8:07
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    Your company wants to award that incentive. They will make a big deal about it if your idea pans out because it gets more people engaged. – IDrinkandIKnowThings Jun 28 '18 at 12:41
  • This question is confusing. You first indicate that "I do not know what kind of incentives they offer.", but then go on to say that the incentive is a flat fee. So which is it? – Donald Jun 29 '18 at 16:27
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You may want to read the book called The Myths of Innovation. If you want to see your idea come to fruition, it is more likely that you will have to shove the idea down people's throat. This negotiation will likely fall on deaf ears. You will have to fight hard to just get the approval to work on the idea, let alone be compensated.

Your language describing your current employer is pretty harsh. Why would you want to continue to work for this company? Perhaps some effort should be put into finding a different employer. Furthermore, if the language is accurate, and your idea is profitable they will find a way to keep you from sharing profits.

So I would ask you some questions:

1) Would this idea be applicable to a different company? Are some of those companies one you would like to work for?

2) Can you bootstrap this idea into a business of your own? Can you do it without much capital?

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  • +1 For the first 2 paragraphs, however he should have a lawyer review the intellectual property clauses in his contract before taking the idea elsewhere. – Ben Mz Jun 29 '18 at 13:43
  • There is no protection at all for ideas. Ideas are ten a penny and anyone can copy them. – gnasher729 Jun 29 '18 at 22:23
  • @gnasher729 a) I’m not a layer, but I know to consult one when I’m unsure. b) Contracts can create limitations where they don’t ordinary exist in law. c) Contracts between employer and employee can define who owns inventions which were the direct result of a persons employment. d) Non-compete agreements may limit the kinds of products an employee can sell to customers of a previous employer. e) Not dealing with a lawsuit is usually much more preferable to winning a lawsuit. f) Are you speaking about South-African law? – Ben Mz Jun 30 '18 at 4:55
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How do I propose the idea, whilst ensuring that they honour the agreement to give us a profit share and not just steal my idea?

Since the terms of the HR policy use the word "bonus" and not "profit sharing", it appears that you will need to get the policy changed before you submit your idea.

Talk with HR and learn how to get such a policy changed.

Once it is changed, only then should you submit your idea to the online forum and to the Innovation Forum for approval.

All that said, if you really feel you are being exploited by this company, you should skip all of this and find yourself a new job then quit.

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The key point, in my opinion, is, that you had a bad experience in the past. Therefore I suggest creating a paper trail, which can be used later to support your claim.

With the documentation you provided it seems that they only pay a certain amount and not a share of the profits. Therefore write an email to the next one up the line of command, that you want to submit an idea but only on the conditions you layed out. If they agree (in writing) proceed with the outlined process from the HR document.

The key aspects are not sharing your idea too soon, so you have a paper trail in place when ready to share and to their process so they can't claim you didn't follow normal procedure.

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As an employee, a fixed salary is usually preferable to a profit sharing agreement.

The problem with profit sharing is that it generates a lot of pressure on you:

  • If the idea doesn't generate profit, you get nothing.
  • If the company decides to no longer support the idea, you get nothing.
  • There are a lot of different ways for a company to calculate the costs and revenues of any individual business process. So if your company wants to screw you over, they can find some cost calculation method where that process makes no profit at all. Then you get nothing.
  • You don't know how much profit it will generate, so you don't have any security for your personal finance planning.

Profit sharing agreements with employees also have several disadvantages for the company:

  • Employees will want profits, but they won't be able or willing to cover it if a business process ends up losing money. So the employee gets the reward, but the company covers the risk.
  • After some business processes with profit sharing were implemented, employees will favor those business processes they profit from over those other employees profit from. That will result in decisions being made which are suboptimal for the company as a whole. (this problem already exists in companies where employees compete for prestige, but adding a direct financial incentive would worsen the problem)
  • If the company is successful, it will end up paying a lot of its profits to employees and none into the growth of the company itself.

So bottom line is, you don't want this and they don't want this either.

Go through the standard process. R10000 is R10000 more than I get from my company when I make a good proposal. If it turns out well, use it as leverage when you ask for a raise in your next performance review.

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