Aug. 4, 1998
Contact: Charlotte Crystal
	(804) 924-6858


McIntire Professor Suggests "Open-Book Management"
SHARING DATA WITH WORKERS IS KEY TO BUSINESS SUCCESS
	
	Even as technology changes the world of business, human beings
continue to hold the key to success.
	Many companies hire good people then fail to let them experience
growth and satisfaction on the job.  They don't let them in on how each
fits into the corporate big picture, says William G. Shenkir, the
William Stamps Farish Professor of Free Enterprise at the University of
Virginia's McIntire School of Commerce.
	"Open-Book Management: Creating an Ownership Culture," a new
book co-authored by Shenkir and published by Financial Executives
Research Foundation Inc., suggests a way to strengthen the ties between
employees and employer and encourages employees to think like owners.
	"Open-book management" refers to a method of business management
that requires top managers to share financial information with
employees. It teaches employees what the information means and how the
company makes money, while empowering them as management's trusted
partners to use the information in their jobs. Employees are rewarded
through a bonus system when the company is successful.
	"Open-book management represents a seismic shift in the way most
companies operate today," Shenkir said. "The challenge for senior
management is to get employees to think like owners, not hired hands.
Having employees who understand how the company makes money and who
share in its success through a profit-sharing system can be a powerful
competitive tool in today's global market place."						
	Shenkir co-authored the book with Thomas L. Baron, professor of
accounting and KPMG Peat Marwick Fellow at the University of North
Florida, and Thomas N. Tyson, professor of 
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accounting at St. John Fisher College in Rochester, N.Y.
	The book provides an in-depth look at seven companies as they
implemented open-book management in the 1980s and 1990s. It explores the
kinds of financial information shared with employees and the effects on
productivity and morale.
	The companies studied are: ComSonics Inc., a manufacturer and
repairer of cable television equipment, based in Harrisonburg, Va.; GE
Fanuc Automation North America Inc., a maker of computer controls for
industrial processes and systems, Charlottesville, Va.; Mid-States
Technical Staffing Services Inc., a temporary engineering and drafting
employment service, Bettendorf, Iowa; North American Signs, a
manufacturer of outdoor signs, South Bend, Ind.; Physician Sales &
Service Inc., a medical supply distributor, Jacksonville, Fla.; Plow &
Hearth Inc., a mail order home furnishings retailer, Madison, Va.; and
Springfield ReManufacturing Corp., a remanufacturer of diesel and
automotive engines, Springfield, Mo.
	"In an open-book company, employees feel engaged, they see the
big picture of how the company makes money and develop creative ways of
saving the company money while working more efficiently," Shenkir said.
"Anything employees can do to improve the bottom line benefits them
personally in an open-book company. Especially during a business
downturn, which every business experiences at some point, this approach
can be vital to a company's survival."
	Despite these benefits, open-book management is not for every
company. It requires an extraordinary commitment on the part of senior
management, especially the chief executive officer and the chief
financial officer, according to Shenkir.
	There is no such thing as "open-book management lite." A company
is either open-book or it's not, Shenkir notes. Either a high degree of
trust exists between management and employees -- or it doesn't. A
company either shares its financial information regularly, routinely and
thoroughly -- or it doesn't. It trains employees, empowers them and
rewards them -- or it doesn't.
	Employers must decide whether they have the nerve to undertake
open-book management. But for Shenkir the choice would be easy: The
risks are low and the potential payoff is great.

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	For more information, call William Shenkir at the McIntire
School of Commerce at (804) 924-4146, or write him by email at
wgs2z@virginia.edu

	Television reporters should call the TV News Office at (804)
924-7550.