Success is rarely entirely due to an individual's own efforts, no matter how solitary the activity. Outside factors always play a part. Talent always has to be nurtured and equipment refined to create that winning margin. There is a big difference between being a winner and an also-ran. Yet the margins are tiny. For example, the average margin of victory in the Daytona 500 and Indianapolis 500 races over 10 years was 1.54 seconds! Yet the runner up earned less than half the winner! It hardly seems fair, does it?

Yet these disparities are true in any endeavour, not just sport, although they are perhaps more noticeable in sport. And perhaps they are more pronounced in motor sport than any other. Certainly it is unlikely that any other sport requires as many people to create a champion. In Formula 1 (F1) it takes a large, multi-skilled team to get any F1 car onto the race track. And it takes another large, multi-skilled team to get it round the track. Races are won, not by the driver's performance, but by the team's. Often it is the pit crew who determine the outcome of a close race. So who gets the glory? The driver!

It is the driver who gets the millionaire life-style and all the trappings of the jet set. Yet to whom is that extra fraction of a second really attributable? Yes the driver risks life and limb to become champion. But his team determine the degree of that risk, and his championship placing. Yet for them there is little more than the thrill and the pride and perhaps the shared glory of winning the Constructors' Title.

Of course some of this may be a legacy of history: a carry over from the days when the racing drivers led "crash-and-burn" lives with the very real risk of death at any moment. However, the sport has become so much safer these days that the risk, while by no means non-existent, is no longer such a spectre. Even at the reduced level of risk, however, these modern day gladiators perhaps still deserve their high rewards. Yet, in few other arenas are individuals so disproportionately highly rewarded for the results of others' efforts. The one glaring exception has to be business.

Racing drivers' earnings pale into insignificance in comparison with those of some business executives. But, until recently, there has been very little challenge to such extreme executive earnings. Yet there is perhaps greater cause to challenge both the rationale and the disparity.

Certainly the executive is taking nothing like the risks the racing driver does. Not only that, you can question whether the executive contribution to success is any greater than that of the driver's to winning a race. After all business success is a team effort, perhaps even more so than in sport, including F1. After all, come race day, the driver is the only one capable of getting the car round the track, and that is a pretty significant part of winning the race, even if it is the 7 second pit stop compared to the runner's-up 8 second stop that wins the race. What does an executive contribute that is comparably as personally significant?

Furthermore, the capitalist system underpinning business is premised on the philosophy that big earnings are the reward for risk. On that basis the driver is entitled to his reward for risking his life. What comparable risk does the executive take? In fact, one can actually argue that their people are the ones who bear the real risk of business. After all, they are the ones who lose their livelihoods if the executive decides he needs to increase profits. And they are the ones who lose their livelihoods if the business fails. Even if the executive faces the identical risks, the probability is that they will find alternative employment more easily than their employees will.

Admittedly an emphasis on performance has done more to inflate executive pay than that on risk. However, this is just as imbalanced, for who is ultimately responsible for a team's performance? A mechanic can lose a race or even a championship by failing to tighten a wheel nut properly. In the same way a computer programmer can miss a comma in a computer program and cost the business millions to severely dent its profits or even jeopardise its existence. Why then should success be attributed to the executive?

Of course it should not. And in a way, this has been partly recognised. Performance incentives for executives are nothing more than the result of the universal spread of performance related pay (PRP). They were born in the theory you can make a team more successful by rewarding individuals for improving their own performance. The idea is simply that if everyone performs better the team will do better as a result. Unfortunately, this plausible theory is logically flawed. In fact there are two areas where the logic fails.

Firstly, it fails to recognise the fundamental principle that team performance is the result of the way the team performs. Thus tampering with individual performance can actually have a markedly disruptive effect on the team. If you want to improve team performance then you have to reward the team for improved team performance. That has to be the primary rule.

Secondly, the inequity with which PRP has been implemented and incentives awarded. First of all, the fact that some people earn bonuses when others do not, breaks the above rule. This causes jealousy and creates conflict and division and undermines the team ethos completely. It is totally counter-productive. More than that, though, the problem is exacerbated by the disparity in the incentives awarded. In other words even if everyone gets their promised reward, unless it is in the same proportion to everyone else, you will still get the same disruptive effect. The team will never again operate at its previous equilibrium.

The problem becomes clear when you look at the disparity between executive earnings and the rest. Executive incentives have generally been significantly higher than those of their employees. This has contributed to a greater pay differential, that has widened the gap between rich and poor. This becomes a lightning rod for discontent and may well be the single biggest cause of employee disengagement.

Some hypothetical figures will illustrate the point. Imagine that you are earning an average income of 30,000 p.a. and you receive a 10% bonus. This means that your gross earnings have increased to 33,000. Now imagine your boss is getting a 500,000 p.a. basic salary. However, he gets a 20% bonus and his gross pay thus goes up to 600,000. This means that the difference in your pay has gone from a base 470,000 (500,000 minus 30,000) or 15.67 times (1566.67%) to 567,000 (600,000 minus 33,000) or 17.18 times (1718.18%). How do you think you will feel when your boss asks you to improve your productivity? It is no wonder that employee engagement is the major challenge it is. Action must be taken to reverse this or the problem will not go away and will only get worse.

Of course one way to solve the problem is to simply do away with PRP. Certainly there is no justification to retain it. That, however, does not address the problem that PRP was intended to solve - namely how to enhance team performance. Here too the solution is not difficult. It simply entails finding a way to refocus energy on the organisation as a single team. And what better way of doing this is there, than to make all employees co-owners of the business? This will re-create the sense of the organisation as a single team, while sharing profits equitably amongst the employees will ensure that the pay disparity at least stabilises. It will ensure that no-one gets the glory for success that they are not entitled to and will go an awfully long way to eliminating any lack of employee engagement.