Compensation Cafe

Is It the Person or the Position?

How much value is added by the individual holding that important management post?  Would those same output results occur no matter who was the incumbent?  Should any person who holds a position of substantial impact be automatically highly compensated?  How much of the “job worth” is truly attributable to the talents of the individual versus the normal outcomes anyone could generate from that place of power?  If someone is placed in a spot whose leverage has been created by the larger organization and its systems, why do we assume they deserve so much more pay than if they were an individual contributor with limited ability to affect the bottom line?  Is it the job or the person that creates value and how much comes from each?

These questions are integral to the compensation tradecraft yet are rarely discussed or even mentioned.

A recent article had an interesting take on the global compensation issues from bankers meeting in Switzerland.  Most felt that their generous remuneration was a matter of disinterest to their institutional investor shareholders, because it was a relatively tiny expense compared to the profits.  But a few noted that "it's the seat, not the individual," and found it offensive to see some callow young ignoramus earning millions merely because they had been placed at the head of a hedge fund which almost automatically generated billions in profits.  That comment brought back memories of my compensation childhood when Robert A. Smith preached the distinctions of organizational leverage versus human capital factors (KSAs) back in the early 1970's to his four young corporate comp/org analysts named Dave Thomsen, Gerry Stern, Larry Cook and Jim Brennan. 

He directed our reverse-engineering of virtually every job evaluation plan that existed at the time.  Taking the most statistically reliable elements of each, we then freshly designed and validated a customized point-factor plan universal enough to suffice for the Fortune 50 multinational conglomerate we served.  Besides the traditional personal features people bring to the job like education, experience and specific types of skills, we had an entirely distinct set of other categories we called “organizational factors.”   The personal human capital elements specific to the individual (KSAs) could be carried from job to job and proved to have significant but limited effect on market compensation.  The real money came from the leverage supplied by the organization for the application of the individual performer’s talents.

A skilled surgeon or product designer would have great value up to a certain point.  The personal value of an isolated worker would not continue to increase at the same rate (it showed an asymptotic relationship) as that of a less “skilled” but more “responsible” manager or executive given a higher degree of wider impact.  A great individual contributor only has one brain, two hands and so many hours to ply their trade.  The market value of personal KSAs flattened out fairly quickly.  On the other hand, even an indifferent manager, director or other executive operates as a conductor, coordinator or force multiplier who stirs those diverse KSAs together and applies them throughout the broader enterprise than the individual work unit.  The bureaucrat who applies the creative talents of otherwise isolated Nobel Prize winners will earn his or her value from that application leverage position rather than from their personal stand-alone talents.  Albert Einstein and Stephen Hawking would have had very limited values as ditch diggers but had tremendous values as teachers and publishers and innovators in the field of theoretical physics.  Many a brilliant genius has starved to death in this world due to failure to find an adequate platform from which their talents could be monetized.

There are things only the person can do.  And there are things only the organization can empower the position to do.   

This might be fundamental Compensation 301 to some readers, well known and fully documented in every textbook, but I don’t recall seeing it discussed much, if at all.  Please offer links or references that prove me wrong.  Supply even better elaboration on the topic.  I’d rather be wrong than right, on this point, because it is pivotal to a sophisticated comprehension of compensation tradecraft.

Whether the concept is new or old, just think about it.  It might help clarify some compensation valuation questions you face on a daily basis.

 E. James (Jim) Brennan is Senior Associate of ERI Economic Research Institute, the premier publisher of interactive pay and living-cost surveys. Semi-retired after over 40 years in HR corporate and consulting roles throughout the U.S. and Canada, he’s pretty much been there done that (articles, books, speeches, seminars, radio/TV, advisory posts, in-trial expert witness stuff, etc.) and will express his opinion on almost anything.

Image courtesy of shaneprigmore.blogspot.com

Job Evaluators Deserve Respect

I'd like to say a kind word about the job evaluators out there.  You know who I mean; those unappreciated, oft-criticized and generally disrespected Human Resource analysts who have been given (because no one volunteers) the thankless task of deciding which jobs in your organization are more or less important than others.

These practitioners are often viewed by those on the receiving end as displaying the behavior of a smug know-it-all, a blind follower of the rules, and having a general attitude of superiority, all wrapped up in a God complex.  Unless they agree with you.

They don’t receive Christmas cards. 

Somebody Has To Do It

But job evaluation is a task that needs to be done.  It's critically important to the organization.  Somebody has to establish order amidst the organizational chaos, to sort out a viable stepping stone hierarchy of jobs, from minor to major - and by how much.  For most of us it's Human Resources who establishes and maintains this internal objectivity; the alternative (having managers decide on their own jobs) would be like having the fox in the chicken coop.

Practically all companies of any size and complexity have some sort of a rating system to establish relationships between jobs and to maintain the credibility of that valuation process.  Employees are trained in the application of that rating system / process, and as such are charged with its administration.

For their part Managers don’t like evaluators; the independent valuation process keeps them from doing whatever they feel like.  The system keeps order, while maintaining equity and fairness through objective application.  Many Managers though, have a "what have you done for me lately?" mentality.  When they approve of an evaluation result, there's silence - because the result was obvious.  When they don't agree with the result the evaluator is a blind idiot.  So all the evaluators hear from their audience, their clients, is criticism, anger and disrespect.

True enough, mistakes can happen, especially in an inherently subjective process, but in a worst case scenario how far off can an evaluator be?  One grade?  Usually there's an appeal process.  As it is, evaluators can only work on the basis of the information provided (what they’re told) before the evaluation.  With no skin in the game, without even knowing the names of the affected employees, they try to do what's fair, and that's to report (to make the decision) as objectively as possible on the internal value of a job. To remain as unbiased as possible.

But the art of evaluation remains the butt of jokes, the kicking boy of every complainant out there who doesn't like the score.

• You don’t know the job as well as I (manager, employee, department head, etc.)

The criticism is that the evaluator can't possibly understand, and therefore accurately rate a job they're only told about, or after reading a job description.  So the (biased) view of the job holder(s) should sway the evaluation.

• Evaluation is subjective; so is the result.  Why should I trust you?

Every job evaluation system is subjective.  Even the point factor formulae are simply a compilation of a series of scored subjective decisions.  The key here is the standard and consistent application of criteria, no matter which job is being evaluated.

• Job descriptions are the problem

The forms used for evaluation purposes are criticized as old, outdated, inaccurate, incomplete and generally not reflective of what is truly going on.  However, this complaint is usually heard after the result is reported.

• Squeaky wheels get greased; outside pressures negate objectivity and credibility

Because of the subjectivity element evaluators are perceived of as easily manipulated by pressure points; politics, favored sons, avoiding controversy, want to be liked, etc.

Who would want such a job?  I didn't.  As my own HR career progressed I passed off this no-win responsibility as soon as I could.  It was like being the medieval tax collector, reviled by all - just for doing your job.  So I've been there, know what it's like to be responsible for making those decisions and facing the wrath (never the thanks) of angry managers and employees.

So give the job evaluators a break and cut them some slack.  They're doing the job that you wouldn't want.  They mean well, and they're doing the best they can under trying conditions.  Instead of criticizing them, help them to better understand the job being evaluated.

And next time around, send them a Christmas card.

Chuck Csizmar CCP is founder and Principal of CMC Compensation Group, providing global compensation consulting services to a wide variety of industries and non-profit organizations.  He is also associated with several HR Consulting firms as a contributing consultant.  Chuck is a broad based subject matter expert with a specialty in international and expatriate compensation.  He lives in Central Florida (near The Mouse) and enjoys growing fruit and managing (?) a brood of cats. 

Creative Commons image courtesy of Winnifredxoxo

Don’t Tell Me I’m Great If I’m Not!

I have both friends and clients who have been struck by an unfortunate dilemma. I have a couple of friends who have been told one thing for months, and perhaps years, only to find out that the truth they knew wasn’t the “real” truth. I have clients who need to realign pay for people who have been told they were top performers when, in fact, they are less than adequate. In both cases it seems more like senior managers were trying to be nice, rather than sneaky.

Why have confrontation when you can have everyone like you? It’s easier to be nice to everyone. Many managers have made this their approach to leading their staff. Rather than point out flaws, they point out only the positives. Rather than prepare their staff for bumpy water in the future, they keep things on the bright side right up to the moment the boat hits the dangerous rapids. The discussion of a potential demotion, cut in pay or job-ending decision never seems to make it onto the agenda.

Employees want to be led, and generally want the truth. I also think managers generally want to tell the truth, but seldom have the skills to do so delicately. While these managers do a disservice to employees by not laying out a realistic path, those of us in the compensation community do even worse by not providing them with the tools, words and examples that will allow them to discuss both the good and bad.

We can’t expect great employees who have been promoted to be great managers to be able to talk about pay issues with any amount of expertise. We also can’t expect that they will always do this task well, even if they have been trained. We need to make it clear what needs to be said to underperformers and check back to make sure it has been communicated.

This is not about avoiding lawsuits or angry ex-employees. This is about not being jerks in the eyes of those we need to keep working hard. Once the trust on performance has eroded in a single example, you risk the chance of other employees questioning their value to the company. Rebuilding trust is far more difficult than maintaining it. Like a swimming pool, it is far easier to keep it full than it is to fill it up.

So look at what you've asked managers to communicate. Then ask yourself if you have provided them the skillset to do so with a complete level of truth. It is not only our job to make sure that pay is properly designed and set, it is also our responsibility to ensure that the discussions around pay reflect the sometimes harsh reality of underperformance.

Dan Walter is the President and CEO of Performensation an independent compensation consultant focused on the needs of small and mid-sized public and private companies. Dan’s unique perspective and expertise includes equity compensation, executive compensation, performance-based pay and talent management issues. Dan is a co-author of “The Decision Makers Guide to Equity Compensation” and “Beyond Stock Options.” Dan is on the board of the National Center for Employee Ownership, a partner in the ShareComp virtual conferences and the founder of Equity Compensation Experts a free networking group. Dan is frequently requested as a dynamic and humorous speaker covering compensation and motivation topics. Connect with him on LinkedIn or follow him on Twitter @Performensation and @SayOnPay

Are Your Performance Reviews like an Annual Physical?

I don’t know anyone who looks forward to their annual physical. There is very little about the process that exudes positivity. Nearly all of us know that  we could have eaten better, exercised more or paid better attention to our health. Even those in the best of health dread the thought that this might be the year that something “serious” may be found. The potential “big-ticket” items overwhelm the progress that may have occurred at other points in the year. The process can also a bit too personal, requiring you to expose more in a single sitting than you care to discuss.

When we are young we tend to simply avoid these events altogether. We assume that we are fairly healthy. Any minor issues can be worked out before we age. We feel good most of the time and have fairly good reasons for those times we don’t. What can a doctor tell us that we don’t already know, or that we’d even care about?

Performance reviews for young employees can be the same. The immediacy of life and the general feeling, and reality, of rapid ascent create less importance for what others think on a once-a-year basis. You have a job, but you know it isn’t likely to be your career. You plan to deal with any problems that may pop-up on an as-needed basis. Nothing lasts forever.

As we get older we start paying more attention. There are mandatory tests based on who and what you are doing. The low-level risks that were built when you were young become high-level risks or actual issues as the problems build over time. The rapid ascent of an early job gives way to the plateaus, jumps and starts of a real career. Some of the bad habits of your youth have simply become part of who you are. You take your medication and keep on going.

Imagine if you had access to your health profile at your fingertips. Imagine if your recent decisions could be quickly analyzed for potential harm and a correction plan laid-out prior to real issues arising. What if you had a medical professional who could answer questions on the fly and point out the best choice to make before you made it?

Whether you were young or old, the process would be more useful. When you’re young, this type of review would fuel a much faster rise and would allow you to make more intelligent decisions about the foundation for your future career. When you are not so young, this type of process could help avoid career-ending or limiting decisions and ensure that you continue to evolve when paths might otherwise flatten.

In both scenarios, the annual review seems ineffective when compared to more frequent or even ad-hoc reviews. So, why do we expect our annual reviews to be effective in the workplace, when they do not work in our private lives?

We received grades and progress reports on regular basis as children. That seemed to work. Science confirms that recognizing someone for good or poor results when the results are measured is the best way to link rewards with effort and achievement. A performance review should be just that…a review. If it is to have any real power to motivate or modify behavior it must be linked to lessons learned throughout the year, not just to foggy memories of months gone by.

Make sure your 3-4% COLA increase and limited incentive budgets mean something this year by enhancing your process for improving your performance review. Imagine if there were no surprises other than the dollar amount. Imagine if your good employees looked forward to their reviews and your less than good knew what to expect in advance. It would improve the quality of the process while reducing the angst and preparation for something that virtually no one currently enjoys.

May you have a pleasant and high-performing 2012!

Dan Walter is the President and CEO of Performensation an independent compensation consultant focused on the needs of small and mid-sized public and private companies. Dan’s unique perspective and expertise includes equity compensation, executive compensation, performance-based pay and talent management issues. Dan is a co-author of “The Decision Makers Guide to Equity Compensation” and “Beyond Stock Options.” Dan is on the board of the National Center for Employee Ownership, a partner in the ShareComp virtual conferences and the founder of Equity Compensation Experts a free networking group. Dan is frequently requested as a dynamic and humorous speaker covering compensation and motivation topics. Connect with him on LinkedIn or follow him on Twitter @Performensation and @SayOnPay

Slaying The Job Evaluation Dinosaur

Job Evaluation:  an assessment of job tasks and responsibilities in order to create a top-to-bottom hierarchy reflective of the relative value that the company places upon its jobs.

Throughout my Compensation career I have never enjoyed having to evaluate jobs.  Quite the opposite.  As soon as I progressed high enough in my organization I delegated responsibility to a subordinate and washed my hands of it.  Job evaluation is a thankless task, with the evaluator subject to criticism from all sides.

• If you agree with an evaluation request, you are only admitting to the obvious.

• If you disagree and value the job different (lower), you clearly do not understand the key duties and responsibilities.

• The subjective nature of the process is viewed with suspicion by everyone.

• Job evaluators do not receive Christmas cards.

In spite of my disdain for the process the act of evaluating jobs has been found useful by companies since the 1930's.

• They need a method to establish a hierarchy of job importance (A is bigger than B, B is bigger than C, etc.).

• They need to explain the relationship of jobs, one to another (A is how much bigger than B?).

• They want to set employee expectations and manage the Reward process (price the jobs).

Job Evaluation does have other purposes as well.  The internal assessment sets career progression steps and assists with organizational development (which jobs are necessary).  It also allows the company to avoid criticism that the competitive labor market (external forces) has dictated which jobs should be paid more or less than others.

Despite these worthy contributions the criticism of the process continues to come from many directions:

• Job descriptions are often poorly written, with content manipulated by managers to gain advantage.

• Pressure is often brought to bear on the Evaluator to increase (almost never the opposite) a rating.

• Evaluation language, forms  and procedures are often complicated and confusing to employees and managers alike.

• Senior management support for the integrity of the process is often limited.

• Employees are skeptical of an inherently subjective process where decisions are made by someone from outside their functional area.

For those who use a job evaluation process (whole job or quantitative), a further step of valuation is to place a price tag on each position - and to do that you need to conduct a study of the competitive marketplace.

Market Pricing

Here is the one process that gets you straight to the core of the matter - placing a monetary value on your jobs.  Some of its advantages as an evaluation process are:

• It is more objective, especially if using multiple survey sources.

• It is easier for management to accept, vs. the judgment of “some analyst in HR.”

• It is easier to defend results to otherwise biased managers.

• The evaluator is subject to less criticism (a personal favorite).

Most companies follow both processes, job evaluation and then market pricing.  Does that two-phased effort add value?  I have my doubts, especially if the prime goal is to establish a salary structure.

Sometimes the competitive market conflicts with your hierarchy.

What if the marketplace indicates a job is worth @$50,000, but as a result of your evaluation process the current midpoint is either much higher or much lower?  Ignoring the market could prove costly, in terms of either dollars or employee disengagement.  But if you follow competitive practice – then what is the point of your internal, job content-based evaluation process?

When faced with a choice most companies would make the change.   Dealing with reality, they would say.  So at the end of the day the true indicator of the value placed on your hierarchy is through market pricing.

Another concern is that, while Job Evaluation can be a long and tedious process it isn’t a sufficient end in itself.  You still have to price the jobs to create an effective salary structure.  The external survey data needs to be “interpreted” by a skilled analyst in order to ensure position matches are appropriate and the subsequent data properly integrated.  We call this “massaging the data.”

Some examples of how market data can be massaged between the survey source(s) and the salary structure:

• When you cluster diverse market data points into a graded salary structure.

• When you are not able to afford competitive rates you may lower the value of each position and create a below market salary structure.

• When you move jobs into certain grades to reflect the organizational realities of your company (the senior analyst must be either one or two grades higher than the core analyst).

• There will also be “favored sons,” positions that must be slotted a certain way in your hierarchy, regardless of market data.

If your goal is to price the internal and external value of your positions you do not need an involved job evaluation process, but you do need market pricing.   I would suggest a market pricing effort first, to establish competitive pay levels, and then if desired for other purposes follow up with some form of whole job evaluation process (keep it simple).  Finally, the evaluator(s) should recommend a degree of massaging to ensure that the final results “make sense,” both from an internal as well as external viewpoint.

Chuck Csizmar CCP is founder and Principal of CMC Compensation Group, providing global compensation consulting services to a wide variety of industries and non-profit organizations.  He is also associated with several HR Consulting firms as a contributing consultant.  With over 30 years Rewards experience Chuck is a broad based subject matter expert with a specialty in international and expatriate compensation.  He lives in Central Florida (near The Mouse) and enjoys growing fruit and managing (?) a brood of cats. 

Creative Commons image courtesy of IvanWalsh

Is Your Pay Structure On The Level?

Internal pay equity - and gender pay equity in particular - is a really hot issue right now. I'm sure you know that within a particular job title or job group, pay rates should be equitable and consistent. You may already be examining your pay data to make sure that it is equitable and consistent.

But have you looked at whether your pay structures are equitable and consistent across job titles and job groups?

Do you know if the difference in hourly rates between your production workers and production supervisors is equitable? What's a reasonable difference? $0.50 per hour? $2.50 per hour?

What about the difference between the annual compensation of your Chief Information Officer and your Chief Financial Officer - is it reasonable? Is it equitable?

We're somewhat used to looking for internal pay equity within a job title or job group, but rarely do we look at it across job title or job group. Making comparisons across job titles or job groups is not easy - there are a variety of factors that come into play. Things like job complexity, required skills and abilities, and even (perceived) value to the organization have to be considered.

It can seem like an overwhelming - if not impossible - task. But the Bureau of Labor Statistics does it every day. They compare wage data across occupations all the time. How do they do it? Leveling.

BLS uses the leveling process in their estimates of pay published in the National Compensation Survey. Even though you won't be publishing your own version of the National Compensation Survey, the techniques used by BLS can help you look at whether your pay structure is equitable and consistent across job titles or job groups.

The first step in the leveling process is to assign each job to a job level. Assignments are based on the duties and responsibilities of the position at the full performance level of the job, not the qualifications of the person who currently holds the job. 

The jobs are leveled using four factors: (1) knowledge, (2) job controls and complexity, (3) contacts, and (4) physical environment. Each of these four factors are subdivided into components. For example, job controls and complexity is broken down into (a) the amount and type of work directions received, (b) variations in and difficulty of the work performed, and (c) the nature of the work within the organization. Each of these sub-components are assigned point values; the higher the level of responsibility or difficulty, the higher the number of points assigned.

Figuring out how to assign point values is the tricky part. Typically, job descriptions are reviewed; discussions with supervisors and the individuals performing those jobs may also take place.

BLS uses the same set of criteria (and points) for evaluating job controls and complexity, contacts, and physical environment for every job. Knowledge is a little bit different - each group of occupations has a specialized set of criteria. You can find a listing of the occupational groups and the criteria used here.

If it seems like it's a complicated process to assess your pay structure for equity and consistency across job titles or job groups, it is. Is it worth it? It could be a very valuable exercise that will give you even deeper insights into your pay structure. Is it something you should run right out and do? Not before you have a handle on equity and consistency within your job titles or job groups... 

Stephanie R. Thomas is an economic and statistical consultant specializing in EEO issues and employment litigation risk management. Since 1999, she's been working with businesses and government agencies providing expert analysis. Stephanie's articles on examining compensation systems for internal equity have appeared in professional journals and she has appeared on NPR to discuss the gender wage gap. Stephanie is the founder of Thomas Econometrics and is the host of The Proactive Employer Podcast. Follow her on Twitter at ProactiveStats.

Either Put Me in Charge or Let Me Be a Lackey. I'm Fine with Either, But I Can't Do Both.

A friend recently updated their status with the title to this article. Ironically, I saw it just as I got off a call with a client who  was explaining that somehow she was expected to serve as both the strategic visionary and tactical processor for her company’s multi-national LTIP programs. The simple request in my friends status update seemed reasonable, well thought-out and familiar. As we traverse the crags of an uneven recovery, companies have found it difficult to create compensation plans that perform as expected. As budgets continue to be bound by uncertainty, companies have been unwilling, or unable, to hire tactical help. This leaves compensation departments in a quandary. When should we strategize and when should we make things happen?

For those of you who are feeling like your personality and activities are being split down the middle, I'd like to suggest a small exercise. Take 4 hours and block it off your calendar. (I know you don’t have 4 free hours, but trust me this may really help.) Let’s just pretend you blocked off 10:00am-2:00pm tomorrow.

• 10:00-10:30: Spend the first 30 minutes making a list of every strategic idea you would address if you were in charge of everything, but not responsible for doing any of the tasks. Rank based on compliance, urgency, cost and benefit.  Call this your “Strategy List”.
• 10:30-11:00: Focus the next 30 minutes making a list of every process you would improve if you didn’t have to worry about planning, administration or reporting tasks. Rank based on compliance, urgency, cost and benefit. Call this your “Tactics List”.
• 11:00-11:30: The next 30 minutes make list of all the tasks you would do if you were never interrupted by other things. Think about the minutiae and get granular. Rank based on compliance, urgency, cost and benefit. Call this your “Tasks List”.
• 11:30-12:00: Go through the Strategy, Tactics and Tasks lists and mark each item that ONLY someone with your skill set or better (not you) can get done. Then mark those that can be done by someone with a lesser skill set.
• 12:00-12:30:  Look at the remaining items. These are the things that you believe ONLY YOU can accomplish. Is this list realistic? Can anything be moved to one of the other lists? When this list is down to two or three items, you are set for a promotion.
• 12:30-2:00: Go have a nice lunch with a friend.  Celebrate that you just figured out how to put yourself in charge or be a lackey.

A very smart manager once told me “irreplaceable is unpromotable.” She made it clear that as long as I was the only one who could do certain things, I would remain the only one doing those things. Turns out, it’s basic logic. If you want to stop doing things on your list, you must first figure out a way for others to do them (or to make the items go away altogether.)

Look at your lists again. Which things do you really want to be doing? Of everything that’s left, can you train, hire, outsource, bring in consulting or temporary staff to get them done? If yes, put together a business case for exactly that. If no, keep working on your lists until the answer is yes. I have seen people change things in a week or two and I have seen cases where the changes were so large or numerous that it would take 6-12 months to get them done. I have never seen company where the changes were impossible.

The key is this: If you want to be in charge, the first step is figuring out how to be in charge. Regardless of whether you want to be a lackey or in charge, the first step is to define what those terms mean. The next step is to clearly communicate to those who can help make the change. This may be your boss, colleagues, or the staff working for you. The key is to show what’s in it for them (WIIFM). If they see the personal benefit, they may be inclined to help.  If you communicate things as a plea for help, you may get short-term traction, but nothing will really change.

So, put yourself in charge or make yourself the lackey, but only you can ensure that you’re not both.

Dan Walter is the President and CEO of Performensation an independent compensation consultant focused on the needs of small and mid-sized public and private companies. Dan’s unique perspective and expertise includes equity compensation, executive compensation, performance-based pay and talent management issues, Dan is on the board of the National Center for Employee Ownership, a partner in the ShareComp virtual conferences and the founder of Equity Compensation Experts a free networking group. Dan is frequently requested as a dynamic and humorous speaker covering compensation and motivation topics. Connect with him on LinkedIn or follow him on Twitter @Performensation and @SayOnPay

A Beginner's Guide To Job Descriptions

After enough gloom and doom about managers hating job descriptions (last month's article), let’s take a fresh perspective and look at how writing descriptions should be handled.   Call this a beginner's guide, a how-to procedural or simply a few tips ‘n tricks that can work wonders.

The Beginners Checklist

The process of writing descriptions doesn’t have to be a pain in the butt.  It may never be a favorite activity, but we can take away a lot of the sting.  It’s my view that a win-win strategy with your managers is to take a more simple and straightforward approach.

The basic needs:

• A simple, short and standardized form so that all descriptions look the same.  Two pages, no more.

• The Basic Purpose of the job – a short summary you could verbalize in sixty seconds.  Answer the question, "why does this job exist?"

• Focused bullet statements that describe only critical responsibilities.  Explain what is key to the impact and import of the job. 

Extra Toppings

Unfortunately many organizations require more than the basic essentials.  They're looking for what I call the “extra toppings,” a combination of ancillary information, feel-good statements and subjective information that often doesn’t help.

If the idea is to describe the job, do we need to talk about candidate qualifications?  And who is deciding this?  Check whether incumbent employees meet those qualifications.

Length of experience?  That’s another subjective area whose inclusion is intended to distinguish between core and senior level jobs.  This is a short cut that avoids differentiating responsibilities.

More useful is a list of knowledge and skill requirements that a candidate must (or is preferred to) have.  This helps recruiters screen candidates, but make sure you qualify the data.

Have a care before you ask for educational requirements, unless your legal staff can defend you.  Many use an “equivalency” phrase, but who understands that?

Is heavy lifting required?  Perhaps travel?  Maybe it’s an outdoor job with dusty working conditions.  Nothing wrong here, but does it need to be written down, or could it be verbalized to the recruiter / candidate – or simply assumed?

Sometimes an organization will add text to a description in order to comply with state or federal regulation.  When ADA was announced, companies scurried to revise descriptions to provide acceptable language.  That language didn't change the role of the job, and arguably didn’t have much of an impact on candidate selection, but the lawyers were happy.

Like I said, extra toppings.  Have a care that your additional content requirements don’t become too extreme.

How To Write A Job Description

• Use bullet statements, not run-on sentences.  Short and sweet.  Focus on key words.   A rule of thumb is to have at least four, and no more than eight bullets.  Beyond that you’re either repeating or listing secondary tasks.

• Start each bullet with a strong verb, like plan, develop, advise, operate, design, prepare, etc.  Powerful action more easily identifies either a direct or support role.

• Avoid weak verbs like assist (what does that mean?), coordinate or work with.  Here the reader isn’t exactly sure of the job’s impact or import.

• Focus on the key responsibilities.  The reader should come away with a clear understanding of the job's main points.

• Avoid flowery language, puffery that adds little clarity.  “Drive and have a passion for x”,  “Be the expert for . . “ and “serve as a thought partner” are taken from an actual client description.

• Throw away subjective adjectives that aim at the how, not the what (excellent, strong, persuasive, collaborative, successfully, smart, solid, immense, aggressive, etc.).

• Write the description as if there's no incumbent.  Don’t be influenced by an employee's background and experience.

• Write the Basic Purpose last.  Once you’ve already prepared the bullets it’s straightforward to complete the summary.

• Know when to stop.  Some writers can’t help themselves – especially when listing the job tasks.  They go on and on detailing secondary and minor tasks , as if everything is equally important.

The Manager's Friend

Remember what you're trying to accomplish.  On the one hand to prepare effective job descriptions, but at the same time to make the process easier for the manager – the one responsible for getting them written.  You want a win-win scenario.

So here are a few thoughts to help elevate you to hero status with your managers.

• Short and simple; managers can get behind that.  Resist the temptation of “specialists’ who tell you all the extra toppings you need.   Short forms are completed faster – with less complaints. 

• Purchase a job description source book.  A Google search will show several quality sources.  If you send managers a generic copy of a like description, they'll have an easier time writing the proper description.

• Use the Manager as the “editor,” the subject matter expert who reviews the description.  They should do that anyway, but it’s a treat when you’re not expecting them to write the darn thing. 

• Offer to help.  Careful here, so you don’t get sucked in, but offering support (training, reviews, Q&As) up front can remove some of the sting of having to do something they'd prefer to avoid.

• If some of the "extra toppings" are generic (i.e., ADA or other compliance language), tell the manager that they don’t have to worry about that stuff.  HR will add it in later.

Good luck out there.  Now you know how to keep managers from chewing off your head.

Chuck Csizmar CCP is founder and Principal of CMC Compensation Group, providing global compensation consulting services to a wide variety of industries and non-profit organizations.  He is also associated with several HR Consulting firms as a contributing consultant.  With over 30 years Rewards experience Chuck is a broad based subject matter expert with a specialty in international and expatriate compensation.  He lives in Central Florida (near The Mouse) and enjoys growing fruit and managing (?) a brood of cats. 

Creative Commons image courtesy of fantasy prof

5 Trends That Are Changing How We Think About Compensation

Several members of the compensation café – Ann Bares, Jim Brennan and myself – teamed up yesterday for a TLNT webinar to examine where compensation practice is headed in 2012 and beyond.  We also looked at 5 trends that are starting to impact how we think about compensation.

Trend 1:  The Evolving Role of Salary Surveys - Useful as they are for competitive benchmarking, salary surveys have several known limitations, including:

• Non-US Information – It’s difficult to get reliable non-US salary information, let alone from a single source.  As a result, companies end up patch working their US salary survey information with various non-US sources. 

• New or Hybrid Jobs – Salary surveys can't keep up with changing jobs.  In addition to the dramatic increase of contingent workers and hybrid jobs over the last several years, new jobs exist that didn't exist until recently, i.e., 'social media expert.'  Salary surveys alone may not get you to the appropriate salary for these types of jobs.

• Total Rewards -In this day and age of cost cutting it's critical to take a good look at your total rewards offering and use this more holistic view to help determine the right salary level. 

What this means: Salary surveys offer a useful starting point for compensation design but there's more work to do on the compensation planning and analysis side in order to avoid over- or under-paying.

Trend 2:  A New Kind of Workforce - The modern workforce is global, multi-generational and 20% contingent (expected to double over the next 10 years).  Moreover, modern technology has allowed the rise of more flexible work arrangements so quite a few people work away from the office. 

What this means: You may have a highly heterogeneous workforce with different locations, priorities and work styles that must somehow fit under one rewards umbrella.  Can your HR systems keep up?

Trend 3:  Flexible Compensation – If you have a highly dynamic, diverse workforce a static once-a-year compensation and performance review may not be the most appropriate tool to assess workers and allocate rewards. 

What this means: Evaluate whether your company's compensation and performance processes are in alignment with your workforce development strategy.  To make the most of limited rewards, consider targeting rewards to different workforce populations.

Trend 4:  New Business Priorities - Some of our most dearly held assumptions about compensation planning were made when the business had different workforce priorities.  Now's a good time to take a critical look at priorities and rewards, for example:

• If developing people is important, does your company reward managers and mentors for developing people? 
• If teamwork is important, does your company reward teams for great teamwork?  
• If our company values are important, does your company reward individuals for adhering to the core values of the business? 

What this means: Give your rewards philosophy a good shake down.

5.  Growing Demand for Transparency - Good communication can make the difference in someone's mind between resentment and gratitude.  Take credit for the things your company does well and be honest about what you don't offer. 

What this means: Every company should offer a total rewards statement to showcase total investment in people, including salary, allowances, bonus, benefits, professional development and even technology.  

For more detail on these trends as well as lots of useful information about salary surveys and dynamic compensation planning you can listen to the webinar here.

Picture courtesy columnary.blogspot.com.

Laura Schroeder is a global talent specialist at Workday, headquartered in Pleasanton, CA.  She has nearly fifteen years of experience envisioning, designing, developing, implementing and evangelizing global Human Capital Management (HCM) solutions and holds a certificate in Strategic Human Resources Practices from Cornell University.  Her articles and interviews on HCM topics have been published in the US, Europe and Asia.  She lives in Munich, Germany and enjoys cooking, reading, writing, kick boxing (well, kicking things) and spending time with friends and family. If you want to read more from Laura, check out her talent management blog Working Girl or follow her on Twitter @WorkGal.

Compensation AND Benefits Versus Compensation OR Benefits... What's the Diff?

If you are in the trade, facts about the overlaps, differences and distinctions among compensation and benefits[1] work characteristics should interest you.  A variety of strings[2] in blogs and internet forums have touched on this topic recently.  Here is one more opinion offered, based on actual research, in hopes of stimulating more discussion.

 

Each job has different requirements.  This table ignores the overlaps in how things are done and summarizes the major distinctions observed by neutral evaluators.  Jobs that combine both functions tend to be management level and are different from the professional positions that deal with only compensation or only benefits.   

Compensation & Benefits Directors have more management leverage, authority and power than their subordinate positions.  Of course.  They are the boss.  What may be a surprise is the fact that the consensus results of job evaluations  conducted by Subject Matter Experts (SMEs) over a fifty-year period show that the direct reports may require deeper specific skills than the executive over them.  That really does make intuitive sense.  The boss directs rather than does the thing.  The executive is not necessarily expected to know more details than the narrow specialist who focuses full time on the most current developments.  The subordinate is tasked with the duties to investigate, study, analyze and report upwards.  The director sets policy and makes things happen.  The director of combined comp and benefits actually addresses a greater variety of functions, duties and tasks than any subordinate.  With a broader span of responsibilities, the boss is more likely to delegate intensive activities to administrators, coordinators, analysts and specialists.  Where the director skims over subjects, the analysts must delve deeply into them.  The boss must be conversant with all topics, but the analyst must be expert in some, even if that expertise is deceptively temporary (because things change).

Change is not equally experienced.  Executives over combined functions tend to work under a more consistent set of rules from above than their subordinates do.  Indeed, they make the rules that are imposed on the underlings.  Directors only occasionally have to change direction, while lower levels must be nimble.  The subordinates who actually implement the change process naturally spend more time dealing with the need to adapt to new methods and procedures than the big bosses do.

Overall, there are great overlaps in all Selected Characteristics of Occupations (SCOs) that apply from Director C&B down to the entry analysts who specialize in each branch.  The differences, however, are distinctive and informative. 

Compensation analysts, for instance, are required to deal with a high degree of variety and more frequently exercise detailed instruction memory than either directors or benefit analysts.  The essentially variable principles applied on a case-by-case basis by comp analysts do seem to demand more intensive focus on capricious details.  Benefits analysts, on the other hand, score higher in reasoning and educational level requirements (same as the directors), have more stable duties and are frequently engaged in activities that require a bit more sustained concentration and persistence than comp analysts and far more than directors.  They also make more decisions than comp analysts who rely more on persuasive skills to influence people than the other jobs that have power positions (such as authority or contract terms).  For instance, Director C&B does not require a persuasive temperament when they set official policy.  Nor does the benefits analyst need to have a silver tongue when the plan documents govern every decision, making negotiating skills irrelevant.

So, there really ARE distinctions.  People can and do excel in both, but most tend to gravitate to one or the other, depending on the circumstances or their personal comfort levels.  It is generally helpful to know the differences you can expect to encounter before you enter a new field.  While this information will not necessarily reflect each situation in every enterprise, it does establish a solid baseline for variation. 

What’s your take?  Feel free to supply your observations and add to the debate about what kind of people are drawn to each functional role.

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[1] BLS O*NET has a ridiculously broad definition of C&B positions which spans Administrator through Office Manager and Controller and does not parse out various combinations. 

[2] A recent worst-jobs list by Forbes placed C&B in the top ten among jobs lost.  This article does not attempt to address the original issue of the July 2011 “how many C&B jobs have been lost in the past 5 years?” string in the World at Work discussion forum at http://www.worldatwork.org/waw/community/discussions/discuss.jsp?did=26632.

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E. James (Jim) Brennan is Senior Associate of ERI Economic Research Institute, the premier publisher of interactive pay and living-cost surveys. Semi-retired after over 40 years in HR corporate and consulting roles throughout the U.S. and Canada, he’s pretty much been there done that (articles, books, speeches, seminars, radio/TV, advisory posts, in-trial expert witness stuff, etc.) and will express his opinion on almost anything.