Labor and Capital

The primary function of a commercial company is to produce wealth for the benefit of those who invest in it.

Under such definition, the providers of financial capital on the one hand, and the employees and management on the other, can be considered as co-investors.

Labor and capital are the two fundamental resources of any entrepreneurial project. The aim of the WorK is K method is to provide a company with the necessary tools to allow it to optimize the use of that wealth created through a better balance between remuneration of labor and remuneration of capital.

Sharing added value is not an end in itself ; it is the way to align the interests of providers of labor and capital, and maybe to even create a genuine community of interests.

 

The alignment of the interests of providers of labor and capital is one condition of structural cost reduction, of efficient governance and of uniting energies around company goals. It ensures that stakeholders will maximize their return on investment while preserving the conditions for company growth.

WorK is K provides solutions to optimize the use of wealth created through the implementation of a corporate contract that ensures the alignment of the interests of all stakeholders.

The basic principles are quite simple:

  • uniting and motivating stakeholders around the same performance objectives;
  • reducing structural costs and organizational risks carried by the company;and
  • aligning the long-term interests of co-investors

In the context of a firm, practical implementation is also simple. No transformation is required.

 

Optimization is achieved according to entrepreneurial criteria; company cohesion, stakeholder loyalty, sharing corporate risk, and investment stability.

These criteria are met by the alignment of the interests of stakeholders for both the short and long term,an alignment that is obtained by a profit-sharing rule that confers on stakeholders the role of co-investor in a common enterprise.

 

Thus, it is in the measurable interest of both providers of labor and providers of capital to implement sharing of the value created in due proportion to the investments or efforts that each put in.