What is one advantage of instituting a profit-sharing plan for employees?

One significant advantage of instituting a profit-sharing plan for employees is the alignment of goals between employees and the company. When employees have a stake in the company's profits, their personal success becomes intertwined with the company's success. This shared interest encourages employees to work harder and smarter, as they can directly benefit from their contributions to the company’s profitability.

As employees see their efforts rewarded through profit-sharing, they are likely to be more motivated and engaged in their work, leading to higher productivity and a stronger collaboration among teams. This alignment fosters a sense of ownership and encourages employees to contribute to strategic initiatives that drive performance, creating a mutually beneficial relationship between the workforce and the company’s objectives.

While increased profits and reduced turnover can result from such plans, the core advantage lies in this alignment, which ensures that everyone is working towards common goals.