Suggestion schemes work on the premise that no-one should understand the job in hand better than the person actually performing it, and that the ideas that they may have on improving their job (and any other aspects within the Organisation) are worth consideration. Although improving profitability and/or productivity, and efficiency or saving money are quantifiable effects of operating such a scheme, of greater value may be the motivational benefit that result from employees discussing and seeing their own ideas implemented for improvements.


All ideas should be recognised, not just to acknowledge the thought of the originator but also to encourage others to contribute. The Work Foundation estimated recently that there were between 400 and 500 schemes in operation, and in its own survey of 103 schemes, noted that over 73,000 suggestions had been received, or roughly 5 from every 100 employees, with around 20% taken up.

In Japan the concept is far more widely recognised than in the UK, and Toyota take up over 99% of the ideas put forward by their employees.

Setting Up

Any such scheme must be introduced carefully, ideas must be considered fairly and impartially, and above all, the scheme must be promoted continuously.

Suggested Procedure
  1. Plan the whole scheme carefully - ensuring that as many employees as possible are eligible. Almost inevitably it will be necessary to exclude those involved in research and development (part of whose responsibilities will normally include generating new ideas) as well as those involved in production study, organisation and methods, etc.

  2. Appoint a senior manager to take responsibility for introducing and running the scheme. With a large workforce the time requirements should not be under-estimated. The fact that a senior person is involved will provide an indication that top management are committed to the concept. The scheme must be constantly promoted and supported - this takes a considerable amount of dedication from the top.

  3. Set up a judging panel which should be objective and impartial. Representatives of employees should sit on such a panel with possibly a non-executive director or even someone not directly connected with the Organisation taking the chair. No-one connected with the judging panel should be able to make a suggestion. This may militate against employees participating in the panel, although to preserve this option, 'terms of office' could be kept short.

  4. Rewards should be paid. The average seems to be about a fifth of the value of the idea. It may be helpful for each idea adopted to set a useful life (restricted to a period no longer than, say, three years) and pay out a proportion of the value each year. In this way the successful 'suggester' as well as his or her colleagues, will be reminded of the value of the scheme - and tax should be minimised.

  5. The paperwork should be kept as simple as possible. The more complex the paperwork, the less likely employees are to complete it. The paperwork must encourage suggestions rather than pose a barrier to their submission.

  6. Confidentiality should be preserved to minimise the possibility of 'poaching' of ideas. This can be effected by the suggestions being handed in sealed envelopes to the administrator and a receipt bearing the date, the name of the 'suggester' and a rough guide to the idea, being issued. The person making the suggestion may gain 'rights' to the suggestion and adequate protection of such rights needs to be provided.


    Reference should be made to the Confidentiality clause included in the draft CONTRACT from which it will be noted that the employer reserves to itself, subject to legal limitations (see below), the rights to inventions, etc., originated during employment. Normally these restrictions apply to work which the employee was performing, and for this reason such schemes often exclude personnel working in research, development or design departments. The concept of the suggestion scheme is to endeavour to encourage all employees to put forward ideas which can relate to subjects outside their own responsibilities.

  7. All ideas should be given initial consideration and a likely decision (that is acceptance or not) within 2 weeks. Leaving the consideration time longer than this may militate against employees' continuing interests. It may help if every (sensible) idea receives a nominal award regardless of take-up or rejection.

  8. The scheme should be given constant and original publicity, and whenever an award is made, photos should be taken and promulgated widely.

  9. The scheme's success depends on the commitment of the workforce. Ideally, the scheme should have an element of fun. The promotional material should stress this aspect without trivialising the scheme.

  10. It may be helpful to award an additional 'star prize' to the most valuable suggestion in a year. If the value of individual suggestions is not thought likely to be valuable, it may be advisable to make this subject to either the total savings or gains exceeding a set figure, or to an individual suggestion exceeding that figure. However, the purpose of this 'star prize' is to aid promotion and hedging it with too many provisos is the surest way to demotivate the very people whose participation the scheme seeks.

An Holistic Approach

Whilst suggestion schemes can be a valuable means of supporting a comprehensive COMMUNICATION process as well as a means of generating extra profits and employee commitment, they cannot perform such tasks on their own. There is a need for a genuine communication policy and practice to be in place first, to ensure the success of the scheme. Without this some schemes fail miserably. Whilst the mechanics may be correct, the attitude of the target audience will be wrong. In many ways this has a cyclical effect: to launch a scheme there needs to be good communication, whilst the implementation and operation of a suggestion scheme can form an important part of successful employer: employee communication.