Delta Airlines announced it was sharing $1.6b of profits with its employees payable on Valentine’s Day. Some people throw around these numbers like this without enough context. It equates to a two-month bonus for each of its 90,000 people.
Pretty good, right?
Delta crushed 2019. Total revenue of $47b. $3b back to shareholders. It has also done well in previous years. One article noted that it has shared over $1b in profit with employees in each of the past six years.
Why should you ever bonus your workforce?
Technically a public company belongs to its shareholders, right? Those owners should be fully compensated from profit. Aren’t the owners taking all the risks which means they should seize all the reward?
And why share profit when you could plow it back into new airplanes, more employees, more facilities, and potentially even more profits in the years ahead? Why not invest in company infrastructure?
It’s because Ed Bastian and other leaders (though not enough) seem to get it. Investing in your people is a long term strategy for improving your business.
Yes, investors need to be compensated. Yes, infrastructure is important. But If you want your people to behave as if they give a damn, then you need to treat them as if you give a damn.