HKBN staff staking their salary in the name of digital transformation

The 'pain-gain' initiative is how the Hong Kong-based telco gets motivation for success out of its staff.

Hong Kong Broadband Network (HKBN) is in the midst of transforming its business from a traditional telecom into a technology services provider.

However, it has taken a different approach to spurring motivation among its staff along this journey, with those across the business staking a portion of their salary on the success of a project.

Speaking at Mulesoft Connect in Sydney earlier this month, HKBN co-owner and head of digital Samuel Hui said that the "pain-gain" initiative sees staff bet 20% of their salary before a project is undertaken. If the project succeeds, they get a "multiple" back; if it fails, the 20% is docked from salaries and given to charity.

"The telecom market in Hong Kong is actually quite competitive, because it's a small area with a lot of overlapping coverage and that's why we use a war zone kind of analogy quite a bit," Hui said.

See also: Digital transformation: A CXO's guide (ZDNet special report) | Download the report as a PDF (TechRepublic)

"In the past, IT would generally be seen as a weapons factory, and then the sales and marketing folks would be in the frontline in the trenches kind of fighting ... then they would send a memo back, create this weapon for me, push it out there, but then by then it was too late. So what we did very differently at HKBN was we actually brought the IT, brought the weapons specialists right into the frontline with us as we fight these battles."

Each of the squads, Hui said, have a clear objective of what targets they need to hit. He said they're empowered enough such that they actually are able to "course correct, or create new weapons or use strategies" to achieve those objectives.

"The business side and the IT side, each of us have a core objective, is it increasing sales, is it increasing retention, etc, and each of these commanders actually put actual money into achieving these objectives and if we hit it, we get a multiple back from the company, if we don't hit it, the money that we put into this pot gets donated to charity, so good on both ways," he explained.

"That's what we call pain-gain and that's really how we started pulling business and IT closer together."

The 20% stake is made by all parts of the business, not just IT, with customer service and operations, and even partners such as those from Salesforce-owned Mulesoft are putting their own money on the line.

"When they say, 'Hey this is something that we really back, this digital transformation is something we really back, here's 20% of my salary into this product', then the executives take notice, because you're putting money on the line," Hui said.  "It all makes business sense because the increase in revenue that we generate from the business out of these projects well covers how much we're getting back, we're just getting a share of it."

HKBN is Hong Kong's second largest telco. Hui said the organisation currently boasts 1 in 3 families using its services, and on the enterprise side, 1 in 2 companies in Hong Kong.

"But we are only really capturing one-tenth of the whole industry revenue which means that there's quite a bit of value that we can bring additionally to our customers and that's really where our whole digital transformation journey comes from, how do we engage our customers more effectively, especially with such a large CRM database," Hui explained.

"How do we cross-sell, up-sell, create loyalty, etc to our customers from a brand and from an experience perspective -- and that's really the vision guiding along our journey with digital transformation."

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