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Author: Kasandra Murray
As the owner of Unlucky Umbrella Studio, Kasandra focuses on the importance of growing marketing and operations together. She has over a decade of experience in management, operations, and marketing. She aims to help businesses resolve critical issues and increase revenue, which leads to happier clients and a better work culture.
TL;DR: LaserWeld, a Texas fabrication shop, pays its teams for what they produce instead of the hours they work, and it runs without supervisors. The result is higher pay, more output, and less overtime. Research backs it up. In this post, we cover:
How LaserWeld's team productivity model works
Why hourly pay and overtime work against you
How to design incentives that don't backfire
If you want help building better incentives for your team, we're here to help.
What if paying your team more actually solved low productivity, instead of causing it? That’s the question at the heart of LaserWeld’s team productivity model, and it’s one every business owner needs to consider.
Finding great people is tougher than ever. If companies don’t rethink how they attract and keep talent, up to 1.9 million manufacturing jobs could go unfilled by 2033. Meanwhile, global employee engagement dropped to just 20% in 2025, costing businesses around the world nearly $10 trillion in lost productivity, according to Gallup.
In a recent episode, LaserWeld’s Mark Lewis and Noah shared how their model works in practice. One team managed to more than double an employee’s weekly pay while also boosting production.
At Unlucky Umbrella Studio, we help businesses grow by connecting marketing and operations. How you pay your team is a key part of that. Here’s what LaserWeld is doing—and what you can take away for your own business.
What Is LaserWeld's Team Productivity Model?
LaserWeld pays production teams for what they actually produce, not just the hours they’re on the clock. Teams own their work from start to finish, with no supervisors or managers in the way. When the team gets better, everyone’s paycheck goes up.
LaserWeld is a family-owned heavy fabrication company in Katy, Texas. It makes parts for the forklift, aerospace, wastewater, oil and gas, and construction industries.
In the video, the team explains how they operate with no supervisors or managers. Teams decide how to get the job done. If someone spots a better way, the team tries it out and keeps what works.
One goal really stood out to us: LaserWeld wants to give employees and their families more time back. When teams work smarter, they can earn more without spending all their time at work. LaserWeld is also sharing this model with other companies in the U.S. and Romania through their Manufacturing Revival effort.
Can Paying Workers More Actually Make a Business More Profitable?
Yes, when higher pay is linked to team results. Studies show that group incentives in manufacturing lead to big jumps in productivity and quality. Those gains usually cover the higher wages and more, because the business gets more done with the same people, equipment, and overhead.
One field study tracked production teams after a group incentive plan started. Labor productivity jumped 68% and defects dropped 95%. That’s not just a small improvement—that’s a whole new level of performance.
Research from the National Bureau of Economic Research found something similar. When manufacturers moved away from individual piece rates, group gain-sharing was linked to improved firm profitability. The study also found that individual piece rates don't fit modern shops, where quality and teamwork matter as much as speed.
The logic is simple. When productivity goes up, it can pay for higher wages without raising prices for your customers. This is called gainsharing: when the team creates extra output or savings, everyone shares in the gain. The same research found that gainsharing also cuts spoilage and absenteeism.
We've written before about how profit sharing improves retention. Team incentives work the same way. When people have a real stake in the results, they act like owners.
Why Hourly Pay and Overtime Quietly Work Against You
Hourly pay rewards time, not results. If someone figures out how to finish a job in half the time, they often end up earning less. That’s not the message you want to send your best problem solvers.
Overtime makes it worse. Overtime pay usually costs 1.5 to 2 times regular wages, but you don't get 1.5 times the output. Stanford economist John Pencavel found that productivity drops after about 50 hours a week and stops altogether around 63 hours. Long hours also bring more accidents, injuries, and defective products.
Too many businesses pay extra for their least productive, most error-prone hours. Then they wonder why margins are tight and their teams are burned out.
LaserWeld turns this on its head. Teams earn more by producing more during regular hours. Overtime drops, pay rises, and people get their evenings back.
What Happens When You Remove Supervisors?
Removing supervisors works when teams have clear goals, shared rewards, and the authority to solve problems themselves. Research shows that ownership plus employee participation drives real results. Without both, just cutting managers usually leads to confusion, not productivity.
Managers carry a lot of weight in most businesses. Gallup found that manager engagement dropped from 27% to 22% in just one year. When managers are stretched thin, their teams feel the impact.
LaserWeld’s answer is to hand decision-making power to the teams. Research backs this up, with one important catch. Studies show that ownership combined with participative management is a powerful advantage, but neither works well alone. Pay people more without giving them a voice, and you won’t get far. Give them a voice without a stake, and you won’t get far either.
Teams usually know exactly where the process breaks down. Our posts on how work really happens and our Operations Improvement Funnel show how to let teams fix those gaps without blame.
Why We Paid Trainers More Than Managers
At my previous company, we made a similar choice. We invested more in trainers than in managers. Our trainers were among the highest-paid people in the business, and that was intentional.
We had two reasons. First, a great trainer gets new employees up to speed quickly. People become efficient, effective, and independent fast. That lowered our hiring costs and reduced turnover, because employees who feel confident in their roles are less likely to leave.
Second, trainers filled the gaps as we grew. They knew their departments inside and out. When workloads spiked or we were between hires, trainers stepped in and kept everything moving.
That’s the same principle LaserWeld uses: invest where productivity happens. It’s also why 86% of HR professionals say training helps attract and keep top talent.
How Do You Design Incentives That Don't Backfire?
Reward the outcomes you actually want, like profitable and high-quality work, not just numbers that are easy to game. Keep the plan simple so every employee understands it, involve your team in building it, and pay out quickly so people see the connection between effort and reward.
Incentives are powerful, which is why bad ones can be risky. Wells Fargo is a classic example. Aggressive sales goals tied to new accounts led to 5,300 employees being fired for creating over 2 million fake accounts. The incentive worked; it just rewarded the wrong thing.
Here's how to avoid that trap:
Measure what matters. Tie rewards to good output, not just more output. Build quality, rework, or customer complaints into the formula.
Reward the team. Group plans encourage people to help each other instead of competing.
Involve employees. Without input and clear communication, people may decide the rewards are out of reach no matter how hard they try.
Keep it simple. If people need a spreadsheet to figure out their bonus, the plan won’t motivate anyone.
Pay fast. The closer the reward is to the work, the stronger the connection.
Where Marketing and Operations Meet
This is exactly where LaserWeld’s story connects to what we do every day.
Marketing grows your business. Operations sustain that growth. When a campaign works, orders increase. If your team has no reason to scale with that demand, growth turns into overtime, missed deadlines, and burnout. Your marketing dollars end up creating headaches instead of profit.
Incentives are the bridge. When your team earns more as output grows, a busy month is good news for everyone, not just the owner.
That’s why our fractional COO services always include a close look at how teams are measured, trained, and rewarded. Our fractional CMO support makes sure your marketing brings in work your operations are ready to handle.
Lessons Any Business Can Borrow From LaserWeld
You don’t need to run a fabrication shop to use these ideas. Print shops, construction crews, agencies, and service businesses can all apply the same thinking.
Define team output. Pick a clear measure, like jobs completed, units shipped, or projects delivered, with a quality check built in.
Start with one pilot team. Test the plan on a small scale before rolling it out everywhere.
Share the gains. Decide up front what portion of improved output goes back to the team.
Give teams decision rights. Let the people doing the work suggest and test improvements.
Invest in trainers. Pay well for the people who make everyone else better.
Track the results. Compare productivity, overtime, quality, and turnover before and after.
Conclusion
LaserWeld’s team productivity model proves that higher pay and higher profits can go hand in hand. The key is how you pay. Reward results instead of hours, design incentives around the outcomes you want, and give your team real ownership of their work.
When you get this right, your people earn more, work less overtime, and stick around longer. Your business gets more output, better quality, and room to grow.
If you’re looking for ways to better incentivize your team and boost productivity, let’s connect. We’ll help you build a system your team believes in, so growth feels like a win for everyone.
Frequently Asked Questions
What is a team productivity model?
A team productivity model pays groups of employees based on what the team produces, not the hours they work. Teams share in the gains when output and quality improve. LaserWeld in Katy, Texas, uses this approach and runs without supervisors or managers.
Does gainsharing really increase productivity?
Research says yes. One manufacturing field study found that labor productivity rose 68% and defects fell 95% after a group incentive plan started. Another study found that gainsharing also reduced spoilage and absenteeism.
Is profit sharing or gainsharing better for small businesses?
Gainsharing rewards teams for results they can see and control, like output or less waste, so the link between effort and reward is clear. Profit sharing ties rewards to overall company profit, which builds an ownership mindset but can feel distant to frontline staff. Many businesses start with gainsharing for production teams and add profit sharing later.
Can a company really run without managers?
Some can, as LaserWeld shows. It works best when teams have clear goals, shared rewards, and the authority to make decisions. Research finds that ownership combined with participative management drives performance, while either one alone does little.
How do I start an incentive program without hurting my budget?
Start with one pilot team and fund the rewards from the gains that team creates. Because higher productivity can pay for higher wages without raising prices, a well-designed plan should pay for itself. Track output, overtime, and quality so you know it's working.
LaserWeld, a Texas fabrication shop, pays its teams for what they produce instead of hours worked and runs without a single supervisor. We break down how their team productivity model raises pay, cuts overtime, and boosts profits, plus how to design incentives for your own team that don’t backfire.