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fantastic post! Unfortunately, we do see people fall into the trap, or the illusion, of precision when trying to do market pricing. Just like in your example of using $47,512...that certainly sounds like there's some laser focus precision there and would be far better received that just saying "47.5 ish".

Something I would add is a reminder to folks that "the market" doesn't pay a single number. Rather, the market pays anything from the lowest low...to the highest high and everything in between. And the people who are paid the values at either end of the spectrum aren't necessarily the ones that are under or over paid.

The job of a compensation professional should be less about trying to calculate the single precise market rate, and more about providing pragmatic, business-oriented guidance about what pay level is most appropriate given the context for the organization they represent.

Great post, Chuck. False precision is what we call the tendency for comp wonks to seek the absolute perfect market data, even if it requires compromises that render the entire exercise pointless.

As you alluded to in your post, international market data is often harder to come by, and within that category, developing country markets are the toughest. I would suggest that the problem there is the application of North American and European compensation survey practices in countries which cannot support them. Compensation professionals are advised to examine their approaches and consider if alternative ones can provide more meaningful results.

Birches Group offers such alternatives.

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