Have you ever used a babysitter?  This is when you have someone else assume your responsibilities while you take a break and focus on something else.  The babysitter stands in for you, is you during the period of your absence.  Someone else does your job.

Typically we think of babysitting when there’s actually a dependent child involved, but it’s not uncommon for ineffective managers in the workplace to use the same concept when dealing with their employees.  These managers seek to use the pay that their employees receive as a surrogate for leadership – for keeping those workers complacent, retained and generally “in line.”

The practice of manipulating rewards presumes that the employee will chase the money, and will be happy with their lot, while at the same time will not require much in the way of supervision, periodic direction or even meaningful conversation.  The thinking here is that, if I provide you with enough rewards you will act as desired in order to not jeopardize those rewards.  The goal is to place the employee’s attitude and performance on automatic pilot while the manager is engaged elsewhere.

So far, so good.  Not necessarily a problem, right?  The red flag goes up the pole when you ask whether these monies are warranted by either performance or business need, or are they simply bribes?

What are we talking about?

Scenarios where pay is used in lieu of actual management are easy to spot.

• The Grand Giveaway:  Where managers try to give away as much money as they can to as many as possible, not worrying overmuch with distinctions between individual performances.  The key is to build an employee’s appreciation of their manager’s largesse.

• Title inflation: The promise of bloated and meaningless titles that distort organizational structures, for the prime purpose of rewarding employees in lieu of cash.

• Over rated performance:  Play the good guy by over-rating performance during salary reviews.  Culprits are often seen rewarding activity over results.  So look busy!

• Assured compensation: Take the risk out of rewards.  Everybody receives an annual merit raise, everyone earns a bonus.  This fosters an attitude of entitlement.

• Counter-offers: “Let’s make a deal” attitude to keep resigning employees from actually leaving; a dangerous practice that increases costs and lowers morale.

What’s the cause of this behavior?   Managers typically receive inadequate training (if any) on how to use their company’s pay programs, so many use pay as a crutch instead.  Spending the company’s money effectively and efficiently isn’t on the radar screen.  They use employee pay like a club to get an employee’s attention.  And once they have that attention the manager is off doing something else – with the presumption that pay will substitute as supervision and motivation while the manager is absent – kind of like a babysitter.

Weak and ineffectual managers don’t actually manage their employees, in the sense of performance direction, leadership, setting good examples and decision-making.  Instead, they want to be liked.  They want to avoid conflict and they don’t want anyone to quit.  They want employees to get along, and to help foster a friendly team atmosphere they try to manipulate pay in support of their efforts.

It’s really kind of a bribe.

So what is “managing” to these people?  It’s not about making hard decisions.  Too often it’s trying to get the most for their employees, deserved or otherwise, whether the organization gains in the process or not.  The manager is focused on their own interests, and is using someone else’s money in the doing.

Why it doesn’t work

Relying on pay as a replacement for management has a short term effective life cycle, at best.

• Employees see arbitrary equal pay treatment as de-motivating to high performers.  Why bother extending yourself if you’re going to receive the same reward as the guy doing crossword puzzles?

• Employees resent favored-son treatment; the names of those who benefit for non-performance reasons will always become known.  There goes your morale.

• No amount of money replaces the value of honest performance direction and feedback.  Those with an interest in learning and growing appreciate the help.

• Absentee managers lose the respect of their employees, who know what’s going on.  Remember that employees leave managers, not companies.

• While employees will take any money carelessly handed out, the organization will not gain because of it.  So these “rewards” are ultimately wasted.

For managers who need a crutch to help motivate and retain their employees, to help them do their jobs, the above cautions likely won’t make a difference.  Their goal is not to manage, but to get-by, to be liked by their employees and to avoid disruptions to their routine.  This is not leadership, but administration.

But for those managers who wish to make a difference, who understand that managing employees is a challenging and rewarding role, abrogating responsibility through babysitting is not an option.  They recognize it as the opposite of management, a damaging practice that will not enhance anyone’s long term career prospects.

Have you heard this one?  “The Company would rather pay more to an outsider than give one of us insiders a decent promotion.”

The complaint is that, when considering two individuals for the same job someone on the inside oftentimes will be offered a lower salary than if the company went outside to hire a stranger.  To compound the insult, it is not unusual for managers to ask insiders to train and orient the new ‘wunderkinde” in how the company operates.

Aggrieved employees feel that an insider already knows the company, the people, the products / services as well as the policies / procedures.  That knowledge and experience is an advantage, they say, shortening any learning curve and cultural orientation.  Taking on the role and responsibilities of the new position and not being paid the “going rate” seems unfair – actually a penalty for being an insider.  It’s as if the company realizes they don’t have to pay as much for an existing employee, that the time spent in the company somehow reduces their market value and limits a willingness to pay a competitive wage.

Prevailing practice is that when a company looks to the outside recruiters will be instructed to search for someone who already meets the qualifications of the job; an experienced candidate who has already performed the job, whose only learning curve would be a brief acclimation to new policies and procedures.  Outsiders are considered to be free of “baggage”: no biases, preconceived notions or social network, and are thus considered more reliable as agents for change within the company.

Note: if someone already has performed the subject role the chances are good they are already being paid about the competitive rate.  If that is the case then the company would be forced to pay a premium to attract such qualified talent.  They would likely have to pay above the going rate (or above the midpoint in some companies).

So, what’s an insider to do?  How can you best position yourself for the inevitable comparison with an outside candidate?

Compare yourself against the description or requirements of the new position and try to be as honest as you can with your internal assessment.  Can you do this job from Day 1, or how much of a learning curve would you need?  Are there aspects of the new responsibilities that you haven’t experienced before?  The results of this assessment will give you an opening for your talk with HR.  They in turn will push the “we’re giving you an opportunity” angle, and you both know they could always go outside for a better qualified candidate.  In fact, an advantage you have is that you are likely a cheaper choice for the Company.  So don’t push the pay issue too hard, or you risk throwing the baby out with the bathwater.

Here’s a checklist for you to remember when you’re doing your self-assessment:

1) Are you already familiar with company policies, procedures and personnel?

2) In your present role have you already demonstrated an ability with the technical side of the new position?

3) An advantage: internal promotions look and sound good to other employees, and managers know this

4) Can you develop an inside track with the manager (the all-important “fit)

5) You are likely a cheaper option than hiring from the outside.  Use that fact to your advantage.

Don’t be afraid of compromise.  Your plan should be to gain visibility for your performance and value, though it may take some time for a positive result to work its way through the bureaucracy.  No matter what you gain from your initial conversation (short of complete victory) suggest a follow-up salary review in three months.  Managers know they’d have a better chance of getting an adjustment approved after the initial hire / promotion, when it’s more likely an exception would be approved.  A manager who agrees to that review (and who will be thankful to avoid a contentious meeting) is already halfway to approving an adjustment down the road.

By being aware of the restrictions your managers are operating under you may be able to help them help you.  Do not beat yourself against the wall of bureaucracy, but plan for your next step; use your insiders knowledge to your eventual advantage.

In our last post we introduced you to Step # 5 of the Seven Step Compensation Diet – the need to set up a pay increase budget and stick with it.  Managers make fewer questionable reward decisions when funds are limited, when they are held accountable and when Finance is double-checking and reporting on transactions.

Hand in glove with this financial tool is the need to obtain Senior Management support for your program re-design strategies.  To gain their support you need to pro-actively make your case.

Step #6: Develop a Metrics Awareness Program

You can grab the attention of your senior leaders by telling them the story of their largest single expense item – your company’s reward program.  They will want to know whether that huge expense (40% to 60% of revenue) is being properly managed.  If there are challenges ahead, or a crisis at their doorstep, you will have their attention.  You will need to tell them what has happened, and why.   They will ask about implications (liabilities, competitive picture, morale, turnover, etc.) and what would it take to resolve the issues being faced.

You had better be ready.

To tell a compelling story that describes real or potential problems with your compensation program(s), you will need to present facts and figures.  You will need to be specific.  Suppositions, theories from management magazines or best guesses based on your years of experience will not make the sale.

You will also face the passive resistance of those accustomed to the laid back philosophy of “if it ain’t broke . . .”   Unless there’s a problem staring them directly in the face, management won’t recognize that the barn is on fire, or that it soon will be.  You will need to instill a sense of urgency by presenting evidence.

Specifics are listened to

To understand the plot points of your story you should establish a series of quantifiable indicators (metrics) that record the factors and activities that impact your compensation programs.  Some examples:

• Average salary / wage

• Compa-ratios

• Count of employees per segment (hourly, non-exempt, professional, management)

• Average performance ratings

• Average pay rise for each performance rating

• Count and average promotional and “equity” increases

• Voluntary turnover (employees who decided to leave)

• Average employee age and length of service

I could go on and on and on (we only have so much space), but you get the point.  Measure what is important to you.  The further refine these and other measures by breaking them down per salary grade, employee segment, male / female, etc.

Once you have the metrics established (collectively called the “dashboard”) and a current status baseline in place, determine where immediate problems might be festering.  I use a simple red light, yellow light, green light code to mark problems, cautions and thumbs up for each criterion.  Follow this by setting specific targets going forward to improve your weak areas, and create periodic milestones to mark your progress.

What to look for

Every organization has different pressure points.  However, if your metrics data indictaes any of the following situations, it’s likely a specific problem that your management would want to know about.

• Average performance ratings that exceed how the business was rated

• A workforce where key segments are approaching retirement age

• Promotion and “equity” increase activity that overwhelms the merit budget

• Low compa-ratios indicate you are not paying your salary ranges

• Any figure that is an unpleasant surprise

Having a series of quantifiable measures will give you a sense of direction, as well as a method to gauge your progress.  Lacking that, your activities would likely spin you around in a circle, achieving little but data collection.  You need to use the data.

Start the ball rolling.  Create quantifiable metrics that will collectively illustrate the well-being of your compensation program(s) – and then establish baselines and targets for each performance indicator.  This key step will help you understand whether your costs are being contained (your diet is working) and whether the ROI on employee rewards is at the level your company requires.

Have you ever watched and wondered how it is that some employees in your organization are recognized and moved upward, while others with more impressive credentials, experience and achievements seem to stagnate – and then eventually move out?

There’s a reason for that counter-intuitive phenomenon; you may have within your management ranks a form of “star chamber” or informal clique that anoints some employees (the chosen ones) while sidelining others.  Which explains why leadership mediocrity is sometimes overlooked, why personality trumps achievement and better qualified employees can be passed over for promotion.  For the select few, middle-of-the-road performance is not a barrier to success – like it is for the rest of us.

Not exactly what you hear in Management 101 training class is it?

What you are witnessing is an evolution of the informal pass-fail rating system that companies have used for generations to decide whether an employee is “one of us”.  Those deemed worthy receive a “get out of jail card” that boosts their career.  Those lacking sponsors are categorized as having questionable value and are liable to suffer a fall at the next organizational bump in the road.

Do you remember the “in crowd” from your high school days?  You may not have escaped them after all.

It’s all about PIE

Psychologists have identified several human factors that describe an employee’s ability to relate to their work environment.  While each may vary in importance from one organization to another, their combination has a critical impact on an employee’s likelihood for success.

Performance: your demonstrated ability to perform the job you were hired for.  How well do you handle your role?  Do you achieve results?  The rating scale is the traditional range of from wonderful to woeful.

Image: do you “fit” within the organization?  Is the image you project (personality, interests, clothing, demeanor, etc.) accepted by the rest of Management?  This rating scale ranges from “one of us” to “one of them”.

Exposure: to what extent are you known or would be recognized in the hallways by senior management?  Who are you rubbing shoulders with?  Here the rating scale ranges from “You are known” to “Who?”

The Way it Was

It wasn’t that long ago that Performance was King; that no matter what eccentricities you brought to the job, as long as you performed well no one bothered you.  Idiosyncrasies and personality quirks were overlooked; “oh, that’s just Bob”, you would be told.  “Don’t mind him.  Just deal with it.”  Your value was measured by getting the job done.

Management training classes would use a “scruffy-looking dude” as an example of a brilliant engineer buried beneath a beard, long hair and mismatched clothes.  Such employees possessed little in the way of social skills, no interest in office politics or traditional business hours, and never wore the company logo.  Their job performance, their contribution to the business was their defining identifier.  It marked them as a valuable human resource.

Image could be important, but was considered more as icing on the cake, not the critical ingredient.  Exposure was even less important, as long as you performed.  “Being seen” was more for those who lacked a strong performance record.  They were the ones who needed the help and support of others.

Btw, the classroom answer?  Treat each “dude” the same as you would anyone else.

The Way It Is

Today, good performance is not enough to ensure success.  Today you must also be a “player”.  You must be able to fit in, to blend with your other playmates, be liked as a person, adroitly play at office politics, be seen with the right people and have the same outside interests.  Your capabilities should not be a challenge to your boss.  How you dress is scrutinized for the image you present.

Of course, if you don’t perform well and you’re not in with the right group, your career with that firm will suffer.  You will shrivel on the vine, if not ultimately chopped off.  However, if you are considered to be in with the right group, that association will step in to help should your performance leave something to be desired.  This assistance can vary from softening the blow to overlooking shortcomings (accusations never stick) to shooting the messenger on your behalf.  Club mates stick together.  They circle the wagons when attacked.  They get even.

What to do?

Sound fair?  That’s the way it is when Performance is valued less than Image and Exposure.  But does that strategy have legs?  I don’t think so.  Leadership and a cadre of high performing people are critical requirements to drive your business forward.  You need such outwardly focused success drivers, not those more concerned about internal group dynamics.

Should you find yourself working for an organization where your personal interests and hobbies are valued more than performance and results, your options will be limited.

• You can try to re-invent yourself according to someone else’s value system, but how much success will you have?

• You can try to stay under the radar screen, lest you be judged – but that doesn’t seem a good career plan, does it?

• You can try to change the culture.  Good luck with that!

• Or you can leave

If you believe that your job performance is your best calling card, that employees should be measured and weighed by their contributions, you may need to reconsider the long term prospects of your current environment.

Leave the mediocrity behind.  Change can be a good thing.

Over the years the Human Resources Department has transitioned through any number of “latest thinking” management concepts and corresponding “buzz phrases” – from “matrix management” to “broadbanding” to “onboarding” and “headwinds”.  Each new approach seemed the brainchild of management consultants seeking to encourage what they called creative thinking and the latest strategies to improve the human factor.

Lately though a persistent theme has settled in that HR should become a “Business Partner” of the organization, in order to be taken seriously by senior management and enhance the value-added contribution of its programs.  This encouragement suggests that HR is not currently a player on the Senior Executive team – but needs to be.

So what exactly is an HR business partner?  Several key criteria have been tagged as descriptors:

• Diagnose business needs
• Develop management’s capability to address HR issues
• Provide advice and a point of view
• The primary focus is driving the business forward
• To educate, motivate and influence others

Does the above describe the HR function at your company?  Is HR considered a business partner?

Your Father’s Personnel Department

Today most would chuckle at memories of the “old” Personnel department, whose primary responsibilities seem to have been tasks like recruiting, record keeping, arranging the blood drives, the safety shoe program and running the annual picnic / Christmas party.  The head of Personnel was rarely considered a “player” at management meetings.  Some in management claimed that the department was only a necessary evil.

That Personnel was viewed as the department focused on the interests of the employees.  Its management was staffed by employee relations generalists, was sensitized by the needs of employees and left the running of the business to the “businessmen”.  Personnel dealt with people.

Today, companies expect more.   Leadership expects less transactional administration and more strategic thinking.  Being labeled a “people person” is now considered a negative, a source of humor among recruiters.

What are the signs that HR is a true business partner at your company?

• Direct report to the President / CEO and listed as a member of the Senior Team
• Able to speak with credibility and respect at the management table
• Able to advance the value of HR to those holding negative biases
• Consulted by senior management on human factor issues
• Company decisions affecting employees are initiated by the head of HR

As a newly designated business partner-wannabe, Human Resources in many companies has transitioned away from the traditional role of caring for / representing the employees.  It has focused instead on utilizing the human capital to assist management in achieving objectives and driving business success.  However, the more successful HR has become as a business partner the greater the danger that employees will lose trust and confidence in HR, exactly because the focus has moved away from employees.

As HR has developed a new stratagem, some might say a new identity, what has been the cost to the original mission?  What part of itself has been lost while chasing the role of business partner?

Danger Signs

Have a care that you don’t lose the heart and soul of HR – its caring connection about employees.  Don’t start looking at them as merely numbers on a spreadsheet or boxes on an organization chart.  There are other departments who already do that very well.

Is the HR function served or harmed by leadership that is “counting the chairs” on their way up the hierarchy?  These are typically fast-trackers who are not HR-trained, but only temporary visitors to the department for a “broadening” of their management experience.  Why is that acceptable for the HR function, but wouldn’t be tolerated in IT, Finance, Marketing, Engineering or Manufacturing?  Is the head of any of these other functions anything less than a seasoned expert in that profession?

Why is HR viewed as different?  Why are other functions already presumed to be business partners?  Only HR is being challenged, remaining a newbie, on probation at best, at worst one step away from getting the coffee.

Lip service to the people department?  Even while sitting at the Senior Management table negative biases from the old days often remain:

• Remember the safety shoe program?  It’s hard to be taken seriously after so many years focusing on administration.  Does HR deal with important issues today?
• If the head of HR has only been appointed to gain experience toward their ultimate loftier goal, how serious can we take a temporary worker who is only passing through?
• HR is still perceived of as offering restrictive advice, what can’t be done; they remain the gatekeeper of corporate policies.  Being an advocate of policy doesn’t win friends.

From the employee’s perspective it is important to consider HR as the source and advocate of fair and equitable treatment, compliance with all regulations affecting employees, and their representative among senior management.

What if senior management doesn’t feel that way?  What if they want HR to become just another “business partner” concerned more about the bottom line – to the exclusion of the human factor?

Have a care that we get what we want – Business Partner – and then our employees choke on it as we lose our way.

When an employee is promoted to their first manager’s position, they are given the proverbial Keys to the Kingdom – your company.  They now have the authority to spend your company’s money.  From hiring, to promotions, to salary reviews and equity adjustments they are now able to make the decisions that directly impact (increase) your labor costs.

However, most of these managers turn out to be, at best, well intentioned amateurs at the process of making pay decisions that are appropriate for the needs of the business.   Fresh from being anointed they often lack the basic internal education necessary to make business vs. emotional decisions – and their actions commit you and the company to costs that may not be in your company’s best interests.

Actions taken by these managers not only increase direct costs, but often irritate other staff members as the circumstances become known, creating morale and internal equity problems at the same time.  The net result is usually a corresponding lack of engagement and ultimately separations by disenchanted employees.

Note:  Most employees leave managers, not companies.  Thus actions do have consequences.  Likely this is not what you envisioned when you made that promotional decision.

Now, how did (fill in the name of your company here) get themselves into this mess?

First of all, no one *really* trains managers on how to properly attract and reward employees via base salaries and incentive pay.

A few anecdotal examples:

• Just because some bloke is a good “XYZ Operator” does not mean they will be an equally good “XYZ Manager”.  The skill sets for success are dramatically different.
• How many managers understand your company’s philosophy about pay?  Do you?  How many understand the workings (the what and the why) of the company’s pay practices and methodology?  These are the folks responsible for spending 40% to 60% of your revenue in the form of employee pay, and even the most well-intentioned is prone to make mistakes.
• Managers want to be liked; they do not wish to pick favorites, do not want to discriminate on the basis of performance and definitely do not want to have their decisions challenged.  They would rather point a finger at HR and assign the blame to them for having to assess performance and distinguish one employee from the other.  Left to their own devices they would give everyone as much as they can.

If you were a high performing employee, would you like to work for this sort of Manager?  If you were coasting at work, barely putting your time in, would you want to work for this sort of Manager?  Which sort of employee do you think will eventually tire of being undervalued, and quit?   Leaving the Manager with a staff of . . . .  You get the picture.

Ineffective managers are always afraid that an unhappy employee will decide to quit, but that is usually a selfish thought.   Their prime concern is more often what your departure would mean to their deliverables, to their reputation as a manager.  Your departure is typically viewed as an inconvenience to them, not an avoidable loss for the company.  A reflection of this is when managers resist a transfer that is clearly in the employee’s career interests.  The manager’s concern is how that transfer affects their department – and whether their personal success becomes that much more difficult to attain.

Ineffective Managers can be a defensive lot, challenging attempts at reform.  Why?  Because of their fear that spotlighting reform action will demonstrate their ineffectiveness (make them look bad), and that is unacceptable.  Typically their advantage within the company is that the more ineffective the manager, the stronger their political connections.   And as senior management oftentimes surround themselves with those most agreeable to their own way of thinking, it’s not surprising.

Assuming the company’s willingness to make key decisions and the presence of the all-important support from senior management, companies can correct the problems that they’ve created.  They can:

• Select candidates for management positions on the basis of their skills / potential for actual management (dealing with people, managing projects, business-oriented, professional demeanor, etc.)
• Educate Managers in the philosophy and methodology of the company’s pay programs, ensuring that this information is shared with their staff
• Construct job specifications that call for a Manager to manage, as a prime accountability, limiting or even eliminating the retention of individual contributor responsibilities.
• Measure and reward the performance of the Managers  primarily on the basis of how they have actually managed their employees, or on the performance of their unit
• Encourage Managers to develop the potential of their employees, to the point that a staff member being promoted / transferred upward is a mark of success for the Manager
• Ensure that procedural checks and balances are in place to ensure that pay decisions are reviewed by at least one higher level
• Hold Managers to an annual salary budget; let them develop the budget and monitor / adhere to it during the year

Consider the above as a checklist that can be used to test your company’s vulnerability to wasted money, employee morale problems / turnover and avoidable cost increases.

Would you be comfortable with how your own company would score?

My advice to clients is to face these issues straight on, to implement policies & procedures that save money without penalizing high performers or mistreating their employee base.  But the challenge will always remain, as there is an inherent reluctance on the part of many managers to make the tough decisions, because we do want to be liked, we do like to give good news, and we do not like to play judge and jury with an employee’s career.

But that behavior is not managing is it?