Rewards & the Era of Hypermeasurement

An interesting viewpoint expressed yesterday by marketing guru Seth Godin on his blog with the post Everybody gets paid on commission.  He relays the story of a Washington Post columnist recently laid off because his blog posts didn't generate enough web traffic.

Of course, in the old days, the newspaper had no real way to tell which columns got read and which ones didn't. So journalists were lulled into the sense that it didn't really matter. The Times quotes Jay Rosen, a journalism professor at NYU,  “It’s an unusual public rationale for serious newspaper people, that’s for sure.”

Wrong tense. It's not going to be unusual for long.

In fact, in a digital world where everything can be measured, we all work on commission. And why not? If you do great work and it works, you should get rewarded. And if you don't, it's hard to see why a rational organization would keep you on.

You don't have to like the coming era of hyper-measurement, but that doesn't mean it's not here.

Seth is on point about the era of hypermeasurement coming our way.  Rightly or wrongly, the digital world is bringing more measurement possibilities to the work that all of us do.  Don't kid yourself for even a moment that your job - that any of our jobs - will be exempt from this reality.

But the reality comes with inherent dangers as well as opportunities.  The temptation, expressed by Mr. Godin, may well be to put everybody on commission.  Why not?  It's simple, it's straightforward.  It ties rewards directly to performance, right?

Commission plans are a great, even an ideal, vehicle for rewarding performance expectations that are simple, straightforward, easily measured ... one-dimensional.  As in "we'll pay you $3 for every $100 worth of widgets you sell."  Problem is, performance today, even in sales jobs, is rarely simple, straightforward or anything approaching one-dimensional.  It's complicated, multi-faceted and often involves (get this!) working with others to get things done.

My point?  Simply this: In a world overflowing with measurement possibilities, we need to be careful and thoughtful about what and where measurement is tied to rewards.

(My apologies to Seth Godin for nitpicking his post; however, it was a great point and a teachable moment I couldn't pass up!)

Update: Interestingly, Ryan Johnson at WorldatWork commented on this same post over at his blog.  Great minds work alike, eh Ryan?

Ann Bares is the Editor of Compensation Café,  Author of Compensation Forceand Managing Partner of Altura Consulting Group LLC, where she provides compensation consulting services to a wide range of client organizations.  She earned her M.B.A. at Northwestern University’s Kellogg School and enjoys reading in her spare time.  Follow her on Twitter at @annbares.

Comments

[E James (Jim) Brennan]

Meanwhile, we have a string raging in the WorldatWork Compensation Community where a disturbing number of our members (or anonymous visitors) don't believe performance can be measured or that incentives work.

As knowlege expands, so does ignorance. Maybe because there's so much to learn.

W. Edward Deming must be spinning. Shades of Santayana!

[Ryan Johnson]

Ann...great minds, indeed! (But maybe Seth's is the greater.) Your points are right on (as usual) about hypermeasurement. I think this trend may be farther out in the future for most workplaces and employers in the future than Mr. Godin might think.

I guess it's not surprising that this popped up in the newspaper business earlier than other places. My impression is that they're looking for anything to grab onto as their collective ship goes down.

[Ann Bares]

Jim:

I bopped over and took a look. Egad. Don't even know where to start in terms of that conversation.

Ryan:

Seth's is indeed greater (speaking only for myself, of course)! I'm not sure the trend is that far away... I'm betting it will be upon us quicker than we think.

Interesting observation about the newspaper business. Bet you're right.

Thanks - both - for the comments here!

[working girl]

Great topic and post and I LOVE the comment from E James Brennan that as knowledge expands, so does ignorance. Great reminder of the dangers of relying solely on metrics.