Crowd-sourced bonuses might be the wave of the future for small business.

Frank and Helena/cultura/Corbis

• Are we on the cusp of a solar energy boom?
• The time's not right for Tesla
• Making money: Shopping for disability insurance, and more

ome cutting-edge companies are experimenting with a new bonus model, says Rachel Silverman at The Wall Street Journal, in which your year-end windfall is decided not by your boss, but by those who perhaps know your work best: Your co-workers. In the case of San Francisco-based Coffee & Power, employees are given 12,000 stock options each, which they can dole out to the colleagues whom they deem most deserving. Some analysts say the move directs bonuses to the right places, while others argue that it could make for some fairly awkward water-cooler conversation. Here, an excerpt: 

Exchanges like those at Coffee & Power make the labor market of an individual office fluid, crowd-sourced, and open to constant feedback. Allowing employees to vote on one another's performances also holds workers accountable and raises the stakes for those who don't contribute, managers say. On the flip side, there is a chance these markets could devolve into popularity contests, or lead to hard feelings among those who aren't recognized by the group.

Rank-and-file workers often have the best information about how others really perform, says Denise Rousseau, a management professor at Carnegie Mellon University.

"Who knows better than employees themselves who the contributors are...?"

Read the entire article at The Wall Street Journal