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Learning From Mistakes

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 02-09-2013

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At speaking engagements or during webinars I’m often asked what key takeaways, what gems of wisdom have I learned during the course of my career.  Like most of you out there I’m still at it; learning something new every day.  But I’ve gained a valuable perspective from what I’ve seen and experienced.  I’ve learned that professional wisdom comes to each of us in two ways:  1) what you learn to do (what works), and 2) what mistakes you’ve seen or made (what doesn’t work).

It’s wonderful when your career development manages to stay on the straight and narrow – with positive role models and good experiences – but all too often we learn our most valuable lessons from failures, from tactics or decisions that didn’t work.  Or from failed managers for whom we’ve worked, and those who apparently made error repetition a personal career choice.

With that practical experience in hand you’ll find yourself saying either, “yes, I should do that, when the decision is mine” or conversely, “no, I’ll never do that.”  Both experiences can offer valuable lessons and help shape your career.

One manager’s gems . . . .

Putting together an all-inclusive list can be an endless affair, given the myriad scenarios, personalities and business circumstances that could be involved.  Instead we’ll try to highlight the big mistakes.

These are provided in no particular order of relative importance, and only reflect my own experiences.  No doubt I’ve missed a few, so feel free to add your own experiences.

  • General Adjustment vs. Merit:  Granting all employees the same pay raise, instead of varying increases on the basis of performance delivered.  It’s easy to administer, but rarely an effective strategy.
  • Performance vs. Entitlement:  Rewarding management with a more generous hand vs. other employee segments – simply because they’re management.  Leadership is no more entitled to fair and equitable rewards than any other employee group.
  • Overuse of Discretion vs. Objectivity:  Reliance on subjective measures in lieu of quantifiable results.  When assessing employees on a subjective vs. quantifiable basis management discretion can sometimes lead to abuses (favored sons, “halo” effect, or even discrimination).
  • Abuse of FLSA Exemptions:  Avoiding overtime by treating non-exempt employees as if they were exempt.  Managers try this tactic all the time, for numerous reasons.  This is when you need to put on your policeman’s hat.
  • Surveys says:  Using a title and a generic write-up for matching jobs against “the market.”  It’s the easy way; anyone can do it.  There’s nothing to interpret, is there?  And then there’s the matter of quality surveys vs. . . . the others.
  • The Performance Distribution Curve:  Assigning employee performance assessments in a manner set to follow a bell-shaped graph.  The operative dirty word here is “assign.”  Nobody likes this tactic, except perhaps employment lawyers.
  • Ignoring Internal Equity: Hiring candidates without consideration of how other like-qualified employees are paid.  There are no secrets, so pleasing the new one while angering two veterans is a dubious strategy.
  • Title Inflation:  That meaningless “bone” you toss employees you can’t otherwise reward.  This tactic will raise fixed compensation costs without providing a corresponding benefit to the company.  You’ll eventually regret the decision.
  • Absent Safety Valve:  It’s often said that a good compensation program should cover 85% to 90% of contingencies; for the remainder a degree of flexibility and common sense should guide the decision-maker.  For those more rigid in their thinking, for whom the policy manual is gospel, or those who avoid stick-out-your-neck decision-making, authorizing of exceptions can be a struggle.

Can you see possible rationalizations for each side of the above?  Of course, depending on a litany of possible mitigating circumstances, individuals and . . . whatever.  Just have a care that your rationalizations don’t become a pattern of excuses, and that you document.

. . . are another manager’s errors

Then there are those decisions that over the course of one’s career you continue to regret – wishing you had the time to reboot your thought processes.

  • Hiring a friend / relative: If you would hesitate to sell them a used car, why would you ever think that hiring them would be an idyllic experience?  Correcting this mistake can be painful.
  • Ignoring Office PoliticsI’m not very good at politics” is a poor response to an important reality that all managers must deal with.  It’s all around us, so to pretend you’re above it all, or otherwise ignore it, is likely counter-productive.
  • Performance will take care of everything:  No, it won’t.  Not anymore.  In today’s work environment image and exposure have grown in importance, to the extent that just doing a good job is no longer enough to ensure career progression, or even longevity.
  • I was too busy for networking:  I usually hear this from people in transition, from those who failed to connect with colleagues, peers and industry insiders while they were employed.  You build a network when you don’t need it, so it’s there for you when you do.

Have I missed anything?  Are there other ill-considered practices or policies that you’ve experienced during your own career?

Of course there are.

Make sure that you learn from them.

Are You the Stuff of Heroes?

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 21-08-2013

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Do you want to be admired and respected by your colleagues, recognized by senior leadership for who and what you are?  Do you want to be known throughout your universe as one who sets the standard?

Then solve a problem.  Stand up and show someone how to get things done.  Clear the pathway; support someone’s idea, save a step somewhere.  Do what it takes.

Just do it.

It’s not hard, really.  It’s a matter of thinking not of yourself first and foremost, but of a greater good that is broader than yourself – and of focusing your attention on getting the results that help the department, the team, the business.   It’s called a giving of yourself.

All too often what we see from many employees and managers, indeed at all levels of the organization, is an effort to be the star, the success story, the stuff of legend, but often at the expense of someone else.  Look at me,” these eager A-types seem to shout, “look at what I have achieved.”  These are folks who seem to have missed reading the memo on team effort.

We all have them in our organization.  They surround us.

Here’s a thought, though.  Isn’t it better to be lifted up (reward, recognition, a simple thanks, etc.) by someone else, then to be constantly trying to push yourself up there?  Doesn’t that ego rush get a bit tiring, what with the constant pressure of looking over your shoulder to gauge the competition?  To paln your next moves?  Do you have periodic stress headaches, where the muscles at the back of your neck tighten to stone?  Are you sleeping well?

Now picture yourself receiving that award, with the accompanying recognition, spotlight, accolades etc.  Nice feeling, isn’t it?  A proud moment.

I think it does make a difference in how one gets recognized.  I suppose that there are levels of self-satisfaction, but the highest must be when you’re lifted on someone’s shoulder.   When you hear the cheer of the audience.  Self advertisement, political deal-making and a passive resistance that holds others back can’t provide the same level of genuine personal satisfaction.  Because deep down you’ll know you cheated to get there.

Think about someone whom you really admire, in whatever field of endeavor you like.   Chances are it’s a person  who has accomplished something, delivered the desired results, made something of themselves.   They stood up for something.  Likely that person you admire so much isn’t someone who took shortcuts, pushed others aside, ignored the call for help or otherwise kept their focus solely on the mirror.

So why would you want to do that yourself?

Of course you wouldn’t.  But now reflect a bit on how you practice at your relationships at work.  Do you admire yourself to the exclusion of others, or can you spruce up your act a bit and become more of a team player?

Naive?  Politically incompetent?  Perhaps I am.  But I think we need more heroes out there, more decision-makers, more team players and more people willing to make a stand for what they believe in.

More folks who aren’t in it just for themselves.

But that’s just me.  What about you?

Don’t Shoot Yourself in the Foot

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 07-08-2013

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A company’s sales incentive plan is like the Pied Piper from the childhood fable; it plays a tune and the sales force follows.  Wherever the Pied Piper leads, the sales force will go – whether it be down the straight and narrow toward a successful business, or into the rough, down the hillside and over the cliff.  Because the melody being played is about money, and when that tune catches the ear those chasing behind will follow it anywhere.

I was once contacted by a client whose sales incentive plan rewarded the sale of products that generated an actual loss on each sale.  The sales reps got paid though – even though their actions were harmful to the company.   Bad behavior was rewarded, and therefore it was guaranteed to be repeated – over and over again.

Which begs the question, why would a tactical plan for incentivizing sales employees encourage  and reward actions that don’t support the company’s own self-interest? 

What behavior does your own plan reward? 

Can you be sure that you’re not doing the same thing?

It’s up to those who design the sales incentive plans to carefully pick the right pathway.  Because as long as the money is flowing the sales rep isn’t going to raise a red flag and ask, “are you sure you want us to do this?”  Ain’t gonna happen, as most incentive plans are not self-correcting.  The lemmings will race over the cliff as long as a dollar bill is waved in front of them.

Have you looked at the details of your own plan lately?  Do they outline a plan of action that rewards the type of behavior (sales volume, revenue, margin, market share, etc.) that supports the company’s objectives – that drives the sort of behavior that helps to deliver business success?  Are you expecting a Return on Investment (ROI) for the incentive money you’ve targeted for payment?

Considerations

While there may be more variations in sales incentive schemes than snowflakes in the winter sky, certain fundamental design elements do apply as prerequisites for success.

  • The company has to succeed.  Only sales objectives whose achievement advances the company’s operations (bottom line) should be used to incent employees.  Otherwise, you might be paying for busy work.
  • Spell out what you want the sales force to achieve.   Employees should understand their specific objectives; what they’ll be paid to achieve.
  • Provide enough reward to change behavior.  If you want to encourage certain behaviors you need to place a fat carrot out in front.  Otherwise, you might be paying for what would have happened anyway.
  • Measure  performance against quantifiable milestones.   An objective you can’t measure is hard to effectively reward.  Avoid payments made on the basis of discretionary judgment.

Yes, there are other important criteria for sales plan success, but unless you start with a clear map that details what you want your sales force to focus their efforts on, you run the risk of missing the mark – which can be an expensive mistake. 

The success and continued use of a sales incentive plan should be measured by the success of the business, not by how busy employees are, or even (solely) how much revenue is generated.  Unless activities can be measured and achieved, and support the company’s business plan, you’re better off with a straight base salary plan (horrors!).  Because providing incentive rewards that don’t advantage the company is often paying for disconnected busy work.

So ask yourself, does your sales incentive plan encourage the right sort of behavior, activities that will drive business success?  Are you paying for the results you need?  Are you getting your money’s worth?

It might be time to check.

 

Beware The Manager Bearing Gifts

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 02-08-2013

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A client once asked me why a Senior Accountant (non-exempt) reported to an Accountant (exempt).  This same company used the title “Supervisor” to describe individual contributor positions and it wasn’t uncommon for Managers to report to Managers and Directors to report to Directors. 

Given that these situations occurred in a large and presumably sophisticated company, one might ask – what’s the big deal, and is anyone being harmed?  Advocates say that offering an employee a special title is a harmless and inexpensive reward, one that doesn’t increase employer costs. 

I don’t think so.

Source of the problem

·         Managers grant esoteric titles to those for whom they have limited means of reward.  I can’t give you the increase you deserve, so let’s change your title to xxxxx.”  Like greasing a squeaky wheel for a short term fix they want to do something to keep the employee quiet.

·         Employees are given titles where none should exist, like the Secretary / Administrative Assistant promoted to Office Manager, while still performing the same job.

·         A “special” title is used because the position is considered so different from other jobs that it needs to be specifically identified.  Unique titles can also be seen as reflecting on the importance of the managers themselves.

A bitter harvest

Let ‘s look ahead at what you can expect from planting these problem “seeds.”

·         Role clarity (job duties, business impact, decision-making, etc.) becomes blurred.  This in turn generates confusion as the company creates Senior Managers and Group or Area Directors and other in-between titles to differentiate the “real” jobs from inflated titles.

·         When reviewing market competitiveness the less accurate the title is in relation to the work performed, the more likely your analysis will be skewed.  Benchmarking unique, employee-specific and inflated titles hampers an accurate assessment of your competitiveness. 

·         Those with inflated titles will expect the perks or privileges that accompany the title, and their absence could cause difficulties.  It’s an awkward conversation when you tell an employee that the import of their new level in the organization is “title only.”

·         Inflated titles can be a detriment to incumbents as well, such as the “Director” who now only qualifies for a “Manager” title with a prospective employer.  Opportunities outside your company are limited because potential employers would be reluctant to hire someone where the new title is lateral or even backward to that currently held. 

·         The natural extension of inflated titles is inflated grades / salary ranges, as the bogus “senior” position would be placed in a higher grade than the “intermediate” position.  This practice increases your fixed costs without a corresponding rise in either capability or performance.

·         Employees don’t like giving up inappropriate titles.  Thus employee relations  issues will likely develop as you try to correct past practices.  You may have to develop creative “buy out” or “grandfather” scenarios.

What to do

If you do find yourself in a situation with inflated and confusing job titles, what steps can improve your lot? 

1.       Organize a cleaning exercise; start with the low hanging fruit and eliminate all unoccupied titles.

2.       Accompany that initiative by implementing tighter authorization procedures before a new title is created.  This would cut off the flow of new problems even as you address the core issue – incumbents.

3.       Fewer job descriptions would be needed if wording was more generalized.  Standardized titles would clear away much of the role responsibility confusion.

The general nature of clerical duties (filing, record keeping, secretarial, forms processing, etc.) lends itself to standardization – which in turn makes it easier to transfer employees without having to “promote” someone when their title changes. 

Remember though, that  title standardization makes more sense in a conference room than it does during an employee discussion.  A “Senior Depository Research Clerk” sounds more important than a “Clerk III” or even “Senior Clerk.”

Fewer titles provide greater role clarity, improved accuracy in assessing pay competitiveness, more control of labor costs and higher morale as employees know where they stand and what they must do to succeed in your organization.

A final caution: be careful of setting up titles without occupants “in case we want to promote someone down the road.”  Guess what?  You will.

Do You Really Pay For Performance?

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 17-07-2013

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To answer this question most companies would say that, yes – they have a pay-for-performance (PFP) program.  Such a statement is chic, politically correct and offers a positive message about how the company values its employees.  What’s to argue with?  Paying employees on the basis of what they have contributed to the company makes sense, does it not?  If they give more they receive more.

On the other hand, to answer that question in the negative is to suggest that you are not being fair to your employees, that your idea of a proper reward is to bypass individual performance in favor of treating everyone the same, regardless of contribution.  However, as that acknowledgement would paint you as an employer who is insensitive to variations of employee effort and achievement, it’s more likely that you’ll fall in line and say “yes, of course we pay our employees for their performance.”

But do they?  Do you?

There is an entrenched viewpoint by many in management that the granting of variable pay increases automatically means that their company provides pay for performance.  However, if as is usually the case practically everyone receives some form of pay increase (90%+), is there really a meaningful distinction being made between high performers and those who merely occupied a chair for the past 12 months?  Isn’t such a practice (if we haven’t fired you, then you’ll get an increase) more like a modified attendance award?

If you’re serious about it, your decision to adopt an effective pay-for-performance strategy should include two critical elements:

  • The decision not to pay if the employee hasn’t performed
  • The decision to make it worthwhile for an employee to be a high performer

One of the common pay practices that continue to hamper the effectiveness of PFP plans for base salary increases is the misuse of the annual merit pay pool through inflated performance evaluations and automatic increases.   Continued use of this practice will increase your fixed costs, but in a manner that will not effectively reward employee performance or encourage extra effort.

Making PFP actually work for your company will require hard decisions from line managers who are otherwise accustomed to maintaining employee morale through the avoidance of objective performance reviews.  We have seen that, while there is a shift toward greater rewarding of individual effort, additional monies are not being provided as a result of that shift.  Merit spend budgets will not increase to accommodate “feel good” increases.  So in order to more effectively use available salary increase dollars companies need to reward their high performers with money effectively taken away from (not granted to) those performing at lower levels.  You can call this, “taking from Peter (average) to pay Paul (higher performer).”

This may also mean that many average performers, the bulwark of most companies, will receive less than they might otherwise have expected from past experience (which is at least an average raise).  What it comes down to is a company’s ability to afford proper rewards for their higher achieving employees (thus motivating and retaining them in the process) by reducing or eliminating rewards to those deemed as underperforming or going through the motions.

The risk exposure is that if managers, through the utilization of performance management programs, do not properly identify and restrict awards for less deserving employees, the PFP budget will not have enough funds to afford appropriate rewards for high performers.  So you should ask yourself, who is it you would rather disappoint?  Who has less impact on your business and whose loss would be less disruptive to your operations?

While published reports clearly indicate a trend away from one-size-fits-all reward systems, one should look below the surface to learn whether employee performance is being appropriately measured and rewarded.  That distinction is the true measure of PFP.

Getting serious

To effectively use a pay-for-performance system a company should:

  • Educate employees as to what performance will be rewarded.  This requires measurements, and performance objectives that align vertically in the organization (employee goals relate to supervision, whose own goals relate to management, and on upward to corporate goals).
  • Provide a well-defined rating scale that helps managers distinguish between levels of performance.  Be careful of the word, “average,” as many managers use that as a default rating.
  • Provide a clear distinction of reward between those who have delivered and those who have not.  An employee who does not see a relative gain from working hard all year (2%+ differential) is less likely to repeat their performance the following year.  For an extra 1%, would you?

So the next time you are asked whether your company rewards employees for their performance, perhaps your answer might not differ, but now you recognize the distinction being made by your employees.   It’s up to you whether to be satisfied with your answer.

DIY Isn’t For Everyone

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 11-07-2013

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Does changing a light bulb make you an electrician?  Does replacing your car’s oil make you an auto mechanic?

No?  When it comes to Human Resources, though – sometimes the perception is different .

In a smallish company the role of Compensation is essentially one of market pricing.  Managers want to know how much a job is worth out there in the marketplace.  Nothing fancy, nothing complicated, just answer the question – how much?  Given the easy access to survey information some HR Managers tend to diminish the significance of compensation analysis with a shrug of the shoulders and a smug, “oh, we can do that.”

Piece of cake

To their view, market pricing is a simple process of matching a job description to a generic, boiled down paragraph from a survey source, then noting the highlighted figure that corresponds to that job.  How difficult is that? 

How bad can it get, they figure, to ask an HR generalist or even a department manager to flip the pages of a survey to find the “going rate”?  Are they going to be that far off?

Yes, they can.  Yes, they will.

Now I admit to having a bit of a bias, but consider this:

  • Survey complexity has increased as customers demand ever greater degrees of “slice and dice” data analysis / market segmentation (industry, revenue,  geography, etc.).
  • Surveys no longer provide just “the number,” but multiple figures to choose from.  Which is best for you?
  • The HR Generalist already has a full time job, and not a lot of time to spend dabbling in the intricacies of market pricing.  They’re looking for the quick answer.  Does quick suit your needs?
  • The periodic dabblers may also be affected by their own biases (they know the job holder) and a simplified grasp of the job under review (relying on title matches or abbreviated “descriptions”).
  • What happens when a critical job isn’t well matched in the survey?  Do you check off “no match” and move on?  What if you really need the data?  Is your ad hoc analyst able to triangulate other jobs into a reasonable assumption of an appropriate market rate?
  • When dealing with international jobs there are a host of limitations on data availability not commonly experienced in the US.  Market pricing overseas can become more of an art than a science.

What can go wrong

The inherent risk is in misreading relationships between jobs, where a wrong job match or an out-of-context figure could become the single domino that starts a chain of distortions.

If a mistake is made with a Systems Analyst, likely that error will be compounded when coming up with the Senior Systems Analyst figure.  And if you’ve historically considered a Financial Analyst similar in value to the Systems Analyst, you can easily peg the Financial Analyst to the wrong market rate.  And so the story goes, for as often as other jobs are considered of similar value. 

But perhaps the greatest challenge to the wannabe analyst is when they’re challenged by two commonly asked questions:

  • Are you sure of these figures?  In other words, defend them as if they were your own creation.  What survey(s) did you use, who are the participants, did you properly match the job, let me see the data, etc.
  • What do we do now?  Having the data is usually the tip of the problem, and like an iceberg there’s always a lot more underneath.  How do we take the knowledge of competitive market pricing and develop tactical strategies to move the organization from a problem zone to safer ground?

So have a care when flipping pages through a survey, searching for the right number.  The figures can mislead you, even as you don’t know what to do with what you have.

Sometimes you do need an electrician, because DIY won’t get you where you need to go.

Thanks For The Advice, But . . . .

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 01-07-2013

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Have you ever faced a situation where management ignored your advice?   Went left when you said go right?

Of course you have.  Likely it’s happened to you more than once.  The experience is a frustrating one, isn’t it?  And can be more than a little blow to the ego,  if you dwell on it.  After all, you’re the professional, the knowledge expert responsible for Compensation in your organization.  That’s what you’re being paid for.  To know what to do.  Not only should management  be listening to you, or so you think, they should be agreeing with you.

Wake up and smell the coffee

But this isn’t the classroom or a WorldatWork or SHRM certification seminar.  What all too often happens in the real world can be quite a bit different than what you see in the textbooks or hear from conference or webinar speakers.  Sometimes management takes your input, listens to your reasoning and proposals,  but then decides to move in a direction different from what you had recommended.  And they may not even explain why.

Every seasoned practitioner at some point needs to become accustomed to the realization that the recommendations they present to management, be they for large projects or part of day-to-day advice, aren’t always going to be accepted – and not necessarily because they’re bad ideas.  When management decides to go “rogue” on you it’s not necessarily a reflection of your capabilities or professionalism.   Or even mistakes that you might have made.  They simply have a different perspective than you.

In such circumstancesthe decision-makers usually have more angles to consider than only the compensation point of view.  Whether they be looking at business projections, the potential impact of share price, financial strength of the company or simply confidential plans going forward that you’re not privy to, they need to weigh your recommendations against what else they know that relates to the matter at hand.

After all, it’s their business, their budgets, their employees.  They can do what they want.  Hard as that may be for you to swallow.

What you have to be careful about is how much you want to push your viewpoint in the face of management reluctance, self-interest or just flat-out bias.  That may not be a career enhancing move.

Don’t have a thin skin about this

When leadership chooses a different path than the one you’ve recommended, that decision doesn’t diminish your role in the organization, or the degree to which your viewpoint is valued.  If you have done your job and made sure that the relevant information and decision points are on the table, and that your leadership therefore has their eyes open to the issues and ramifications, you can relax that you’ve done all that there was to do.  You can sleep well tonight.

Because your responsibility is to advise, to offer the best professional recommendations that your knowledge and experience has prepared you to offer.  Management is counting on you to provide this.  That is the measure of your importance.

Consider the police officer making an arrest.  Their job is to gather information (clues) and apprehend a suspect based on those clues.  But then someone else is responsible to prosecute that suspect, using the information gathered by the police.  Or they could decide not to prosecute.  It’s their decision.

But we’re still human, and it can rankle.  Often we’ll find that our ego is in full bloom once we make a recommendation – as if anyone who disagrees with us doesn’t respect us or value our opinion.  That they don’t love us anymore.

Get over it.  Shake it off.  Because they’ll be another issue tomorrow.  And you can be a hero then.

Understanding the Employee Perspective on Pay

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 28-06-2013

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When it comes to paying employees for the work they perform, what do you think they expect?

__________________________

Or do many in management even care enough to ask this question anymore?  Perhaps the collective attitude these days is more typically either, 1) “they’re lucky to have a job,” 2) “where are they going to go“? or 3) my personal favorite, “I pay, you work.”

When employees feel mistreated or taken advantage of in the performance = reward equation you’ll see the result through lowered morale, mental disengagement, reduced productivity and even separations.   Given the business risks involved it’s discouraging that not enough of those in charge actually consider the issue of pay from the perspective of those doing the work – or don’t seem to care.  

Such an important issue should generate a better reaction than supposition and negative bias.

What’s the problem?

Any manager worth the title should be expected to anticipate employee issues, especially those that have the power to harm the business.  It’s about knowing your employees, about being prepared.

Because payroll is likely your largest single expense, representing 40% – 60% of revenue.  Shouldn’t how you handle pay be as carefully considered as the way you would view the cost of raw materials, the acquisition of a new business, or the financing of more brick and mortar?  You should look at this expense from every possible angle, to better understand the underlying causes and how you can do better.  To manage reward dollars without harming the business you need to understand those factors that impact employee pay, as well as the attitude of those being paid.

Taking that hard look will mean trying to understand the employee perspective – the human factor behind the cost of labor.  It will mean understanding how company pay decisions are perceived by those on the receiving end.

It can help when you think of pay from the other side of the desk.  Employees provide a service and you pay them for it.  But that shouldn’t be the end of the equation, as money doesn’t manage people – you do.

What do employees expect?

Do you know what employees expect from managers, and from the company?  Their basic wants and needs have a direct connection to their performance, and to their commitment to your organization.  Because you can pay someone and still not get much out of them.

While individual circumstances might vary somewhat, it’s reasonable to say that employee expectations fall into several broad categories:

·         Competitive pay:  No surprise here, because that’s probably what you want too.  You don’t need to be a premium payer, and should avoid the label of “law baller,” as you ensure that provided pay opportunities are consistent with market practice.

·         Opportunity to earn more: Employees should know that opportunities are available to them through pay increases, variable compensation, promotions and even overtime as appropriate.

·         Regular pay reviews: Don’t let employees hang in the wind; avoid the comical stereotype of employees concerned over how to ask the boss for a raise.  You don’t have to grant anything, but let employees know that you have regularly scheduled reviews of pay and performance. 

·         Timely and accurate payroll: Anything less than 100% performance is a problem, as perfection is demanded – especially by those living paycheck to paycheck.  Payroll providers will tell you that you never hear from the 99%, but only from those with problems.  And the calls always start with an accusation.  So get it right and keep it right.

·         Fair treatment: Employees have a distaste for “favored sons” or special treatment cases – especially if the perception is that such treatment isn’t deserved.   Recipients will become known, so don’t start putting skeletons in the closet.

Do you understand these expectations?  Do you consider them reasonable?  Are they the sort of expectations that you have yourself, for how you want to be treated? 

How you and other managers react to someone’s expectations, by either actions taken or by lack of attention (ignoring) will set the tone for your employees; you dismiss their concerns at your peril.  You don’t have to do anything, of course.  But your eyes should be open and your decisions based at least partly on knowledge of what your employees are thinking – and expecting.

Otherwise you’re making decisions in the dark, and how many gems of wisdom come from that process?

Think about whether your management treats employees as “we” vs. “them.”  Are employees viewed as boxes on an organization chart or as real people?  Are they considered an important asset to the business, or a cost item to be managed (dealt with)?  Whatever the answer, your attitudes will become known and discussed among the staff.

Take the time to understand where your employees are coming from.  That bit of research will provide dividends down the road – no matter how you choose to pay your people.

Five Reasons For Reading This Article

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 20-06-2013

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5, by sideshowbarkerThat got your attention, didn’t it?  Quite a teaser title, grabbing your attention and compelling you to at least read the opening paragraph.  And that of course is the reason that blog authors use and over-use this tactic.  It’s a hook that dangles a quick fix answer in front of your nose.  You can lose weight, increase sales, get a new job, manage your boss and cure cancer – all by condensing the apparent solution down to a few simple steps.

Who can resist the lure?

In our own field of Compensation this basic check mark tactic is in full bloom, with repeated examples diluting the complexity of every problem and offering simplistic solutions that in all truthfulness should be obvious answers to most.  How often are those quick steps actually little more than common sense, and have you the reader muttering, “Of course“?  And there perhaps lies the rub.  What you gain from these “steps” is often less gems of wisdom than a condensed rehash of what you already know, only now formatted with a seductive lure.

By comparison, most workplace problems have more moving parts, more complexities and more risks associated with wrong moves than would be suggested by a short “just follow these steps” inducement.  I don’t have an EASY button where I work.  Do you?

But real-answer articles are more complex to write, require more words to explain themselves and may suffer lack of attention from a “don’t have the time” audience.

Then again, perhaps a bit of silver lining can be for those using the list of steps as check marks for their own activities, sort of as a reminder to buy the milk, take out the garbage, feed the cat, etc.  Not rocket science, but a convenient to-do list reminder.  Whenever you’re undertaking a major project, having a project plan that includes a list of necessary activities could be a useful tactic to keep things on track and on time.

You can’t take the chance

We’re helpless to resist the step-by-step hook though, perhaps out of fear that we might be missing the solution to the Gordian Knot, the Rosetta Stone or perhaps finding the location of Atlantis.  That promised quick fix answer to our most frustrating challenge, the one that has seemed just out of reach for so long – might be right here in front of us, miraculously, and all dumbed down to make it seem so simple.  All we have to do is read this article, blog post or link to another website.  It’s like taking a diet pill, isn’t it?

Oh, and the five reasons I teased you with at the start?  Let’s see:

  • Bullet points are easier to remember than paragraphs
  • You’ll be able to recite the points later, perhaps at a meeting where you’ll look good
  • Remembering the 1-2-3 steps will gain you instant credibility outside your functional circle
  • There’s less risk of challenge to bullet points than to explanatory text
  • The author can prepare an article or posting faster this way

And in case you haven’t guessed it by the above, yes, the number of steps, reasons, causes, etc. is usually a made-up affair.  Many authors first decide on the number, then back into the explanations.

It’s all about getting you to read their stuff.

But that would be a 6th reason.

Is Your Guess as Good as Mine?

Posted by Chuck Csizmar | Posted in Articles, Universal Compensation | Posted on 12-06-2013

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Why do we think that compensation survey data is the equivalent of Moses coming down from the Mount with the tablets – the ten commandments?  That whatever the survey says must be right?  We don’t believe that about what we read in newspapers anymore, or see on television, or certainly not from the “anything goes” internet.  So do you think that a compensation survey is somehow the last bastion of a “trust me, I saw it here” innocence?

Are you kidding me?

Consider your own organization; who is responsible for completing those compensation survey questionnaires?  Some high level specialist possessing an in-depth knowledge of the organization’s jobs, organization charts and inter-relationships?  Or perhaps you tap the lowest level employee,  the newbie, who finds themselves assigned with the task that no one else wants?

Do you think that your organization is the only one using the inexperienced to complete undesirable tasks?  Or is that common practice?  And somehow out of this skewed process you think that the result of inexperience, rushed deadlines and minimalist involvement delivers gold?  Delivers results that deserve to be treated as gospel?  That whatever the resultant survey report says must be accurate, must be a reflection of the prevailing pay practices out there, and must be representative of what others are paying for your job?

Seriously?

I have the number!

Compensation practitioners will tell you, that management has a tendency to take the number you give them and run with it – often ignoring whatever cautions or qualifiers you might have tried to provide.  Perhaps the job match is tentative, or only five companies showed a match at all, or all that is available is national data, not your industry or revenue size.  Many managers won’t see it, they won’t hear  the “yes, but,” because now they have the number in their hands.  That’s what they care about.  Unless of course they don’t like the number you gave them; then you’ll get their attention – usually in the form of criticism over the data sources, the process and on a bad day even your professionalism.

Some survey providers or consultancies offer their own “system” of job evaluation that’s tied to a proprietary survey software – or an evaluation process advertised as objective.  This could also mean that they’re guessing at a market number, based on algorithms (how many managers understand what that is) and formulae to project a marketplace figure – on the basis of what other jobs are being paid.  So if you know the value of Job A and Job B the “system” would offer you a projected figure for Job C.

Yeah, you could take that to the bank.

So what’s a good practitioner to do?

Of course, if all you’re looking at is a number in your hand, you might lose sight of the fact that the figure you’re running down the hall with is a simple formulaic guess.  Which could later burn you and the poor soul who gave you the data.

So I have two simple pieces of advice: 1) use multiple survey sources to establish a trend of information, and 2) avoid giving out draft information.  And if you can’t do #2, provide the figures in writing, accompanied by whatever qualifiers you feel are necessary.

CYA.