Innovative Employees Are Paid with Shares or Even a Share of Profits

In a speech by Ivan Vidaković, the General Director of IBM Croatia, who emphasized the importance of transforming business processes as well as the importance of explaining to people where these changes lead them, the fifth IBM Forum formally concluded on Friday.

Vidaković, in his brief speech, essentially ‘drew a line’ under the discussions at two round tables at this forum. He pointed out the importance and interdependence of the people who make up the organization, the processes that are created within it, but also need to change.

Just before Vidaković’s speech, a round table titled ‘What Makes You Special? People. Technology. Processes.’ was held, which is actually the motto of this year’s IBM gathering of business people and IT professionals, one of the most important ICT events in Croatia. The round table was moderated by Zvonko Pavić, the president of the Association of IT Journalists of the Croatian Journalists’ Society, and featured Danijela Bistrički Morović, the director of network management at Vipnet, Draženko Kopljar, a member of the management board of PBZ, Aleksandar Raić, the director of Global Business Service – IT (the independent IT division of Pliva), and Zoran Kordić, the director of the IT sector of the Croatian Pension Insurance Institute.

When asked what makes their organization special, Draženko Kopljar provided the most original answer, recalling that they wanted to be completely different from others when they approached the transformation of PBZ, and that from the beginning of that change in 1998, the motto was almost identical to the Forum’s motto: ‘People, organization, technology’, and that all of this needed strong technological support. In PBZ, they chose a longer and harder path relying on themselves and their horse, not because there are no ready-made software solutions, but to not be the same as others, as they wanted to be innovative and create a positive difference. PBZ’s strongest IT expert claims that they do 98% of the work themselves, and that their paradigm is to develop core banking, while e-banking, for example, cannot bring an advantage, so others do that for them, but they focus on what brings an advantage. In this sense, he noted that PBZ is the only one on the market that offers online loans without human decision-making.

Kopljar also recalled an anecdote from the early days of the changes when part of the middle management resisted transformations, especially the introduction of email, as these directors had been accustomed for years to having their secretaries handle all correspondence. When the CEO heard this, he said: ‘Install it for me first, and let’s see who won’t read my emails!’

A member of PBZ’s Management Board revealed that for spending in the IT sector at PBZ, there is more than 385 million kuna available, and that with this amount, miracles can be made, but also a lot of damage.

The director from the pension fund assessed his budget as good, admitting that it amounts to between 30 and 45 million kuna annually, and that they balance with different technologies, but that most of it is produced in the Institute because there are no packages tailored to our pension system, and that they are not in a hurry with procurements and are conservative when purchasing. Kordić also complained about the status of a public institution, a poor public image, but also the inability to reward employees. He mentioned that he had just created a team of seven young experts, but now only one remains, as three went to Erste and three to Privredna banka. Kopljar from PBZ apologized for the emotional pain and noted that he has about 400 people in the bank’s IT sector, but he still needs 36 more.

The director of Global Business Services explained that during the outsourcing process, i.e., the separation from Pliva, he lost about 25% of the staff. As a process that will differentiate them from the competition, but also a quick response to problems within solutions like SAP for which they have a whole support system.

– If we push 420 people to be creative, then they must also be rewarded for it. We reward innovation through a whole range: money, shares, promotions, expensive training, and team building. A person must feel this materially, and sometimes a warm human word is enough as a reward. A spirit of innovation has been created – those who are innovative are more valued – explained Kopljar. Danijela Bistrički Morović added to his words by stating that Vipnet recently introduced an innovation management process – employees submit proposals for new products or improvements to business processes, and they are paid a share of the profits generated by that innovation or savings.

When asked who the people are that make a difference in their organizations, only Raić directly answered by naming his four deputies. (Igor Škevin)