« Choosing the Right Currency for Compensation & Rewards | Main | Gone With The Wind (Your Guidance, That Is) »

03/01/2013

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Well said, with an apt analogy! A compass is for orientation, not for direction. Not everyone needs to go North all the time.

Telework has been a viable option for many decades, but it is not always appropriate. In our trade, seems like the science involves knowing the choices available, while the art is the judgment to select the proper method for the circumstances.

To me, with the information I have gleaned, it sounds like a sound business decision implemented poorly. If part of the message is that, at Yahoo, we need to pull together and our work will benefit from spending time with each other, an email from on high is a poor communication strategy. Marissa (and her leadership team) would have done better by modelling the sort of behavior she is shooting for, talking with employees and using the change as a way to get everyone talking about how to spur creativity to improve results. She seems to have missed an opportunity and I hope that doesn't indicate that further implementation of this change will create more pushback/obstacles than were necessary.

I agree wholeheartedly with Mayer. It is disappointing that some in HR cannot get past the surface issue and see the more important business issues.

Read this. Super post on TLNT.

http://www.tlnt.com/2013/02/27/sometimes-a-policy-change-is-just-a-policy-change-even-at-yahoo/

The biggest issue is that this was "leaked" before the company finished its communication.

Very few at Yahoo can honestly argue that they are operating at their potential maximum as a company. Obviously, the "old" way was not working. Unfortunately it was a cornerstone of their recruitment and retention practices.

Had messaging been better I doubt I would be writing this comment right now.

Thank goodness more people are coming forward and discussing the situation for what it is - a step in the process of revitalizing the Yahoo! workforce.

Clearly this communication wasn't executed well. But in the bigger, longer view...so what? It is not a cataclysmic, unrecoverable misstep. Yes, some people are disgruntled. Though I'd wager that the most productive, engaged folks working at Yahoo! are neither disgruntled about it nor did they leak the memo.

As you so aptly pointed out, this is a decision based on the needs of Yahoo!. All this noise about well, all the other noise, is just that.

YIKES! Here I am posting in response to our own post. How did that happen?

The key 'finding' total reward pros need to be concerned about is that CEOs have significant expectations concerning how pay and rewards adds value to the business. And unfortunately for many of us these expectations have little to do with some of the issues and beliefs we seem to have accumulated over the years.

If you take a look at the 'Crisis' article we published in the WorldatWork Journal you see that CEOs are not giving our profession high grades in times of business crisis. They told us that 'what works in good times may not work when businesses are challenged'. That should be a huge concern and something we must do something about.

Pat and I are speaking at the April WorldatWork conference and will highlight the CEO study as much as an hour permits. If any of you are at the conference it would be fun to talk about what we can do to better manage our profession so it is more helpful in making the organization we work for a financial success.

Jay/Pat - I appreciate the position you've collectively taken with regard to Marissa's decision to bring those remote workers in from the cold. I assume some thought went into that decision, and the pro's and con's thoroughly reviewed. She deserves credit for taking a stand which she believes in, regardless of the inevitable carping that will follow. She's the boss, and has the right to manage her workforce any way she deems the best.

I believe she's made a strategic mistake. And, with all due respect, I take issue with a couple of your supporting observations.

Yahoo should care about competitive practices, because those are the employment alternatives facing the talent Yahoo requires. CEO's should care about progressive working conditions, because they relate directly to business success.

It's probably me, but I'm not seeing the connection between 'pay and rewards programs' and having everybody working at the office. If you're implying that compensation systems are only effective when everybody's together I'd be shocked; you guys are much smarter than I am, I'm sure, but even I know that physical location has little to do with compensation efficacy. Further, I don't believe that virtual work and 'commitment to performance' are mutually exclusive.

Frankly, my hunch is that the real reason CEO's are having heartburn with remote workers isn't due to performance issues; it's because they and their management team lack the remote management skills necessary to effectively utilize virtual workers.

Yahoo is swimming upstream, and the current is getting stronger. Demographics, technology, environment, cost; these trends are all pointing to more flexible working arrangements, and every one has significant business implications.

Hi John:

I appreciate your position as well. The issue is that Yahoo's CEO sees the relationship between working physically together and organizational success. She experienced it at Google as I understand. And it is her call and her responsibility to align her folks with whatever goals she needs achieved. It really makes no difference whether you and I see the connection between innovation, collaboration, and working at the office. She does. It is her decision and her responsibility. You and I are not trying to get Yahoo going again.

One reason Pat and I labored to interview CEOs is because much of what total reward professionals believe is based on studying what we think makes for 'best practice'. I can tell you that the CEOs we spoke to are pretty disappointed with some of advice and counsel our profession provides especially during times of business crisis.

You mentioned 'competitive' practices. Would you be surprised if many CEOs believed that you don't need to pay everyone in your organization 'competitively'? Now this also tends to be the CEOs who believe in using only business metrics for variable pay and support tying base pay adjustments to the acquisition and application of skills and competencies so it is not a universal belief.

I suppose we could cast stones at CEOs and how they perform. My interest to be honest with you is how total reward pros can add value to their business. If you and I could do that I would say our effort has been well worthwhile.

Jay

PS: This now represents the most 'blogging' I have done in my 50 plus years in this profession. I hope all of us don't sound too stupid.

It is with respect for the work of Zingheim and Schuster that I make these comments.

In their research, they have interviewed the CEOs of firms that received TARP funds from the federal government to stay afloat during the financial crisis. Jay and Pat found that work-life programs did little to help these companies get out of their difficulties. The CEOs have now replaced the HR staffs because of it.

First, why go the firms that needed gov't help to stay alive? Wouldn't it have been better to go the companies that didn't need help to see how their HR practices contributed to their survival? Successful companies have more to teach us than the failures.

Second, the fact that work-life programs did not help in keeping them alive and in motivating employees seems obvious. These programs are not motivators, they are used to attract and retain employees.

Third, why did they fire their HR staffs, as if they were to blame for their troubles?
If the CEOs were so smart, why did they hire them in the first place? Weren't the CEOs smart enough to see that their HR staffs were leading them astray?

Fourth, why give the CEOs' opinions any weight now? They are still the same people who hired the wrong HR staff. Weren't they the ones that brought their companies down, because they made investments that were too risky? I would give their opinions little weight regarding HR policies. It seems like you've gone to a group of incompetents for lessons on how to run HR.

Respectfully,

Maury Schapiro

Hi Maury --- one point I would like to make is that "yes" the past CEO and likely other C-levels may have hired some wrong people when they ran the company.

Since Marissa came on board she is personally interviewing all candidates who are considered final by everyone else interviewing. Obviously she doesn't have the time to talk with everyone who has made it to the interview stage.

She obviously wants 2 things:
1) to see what her HR/managers view as a "final" candidate and
2) make her own assessments if the candidate is the right "fit" for the company she is trying to rebuild.

So past management may be at fault for past hiring practices. She has recognized that and is now personally involved.

BTW she caught a lot of "flack" from outsiders when they found out she was a part of the interview process.

Again --- bear with me but this whole issue is a hot button for me.

I agree with Jay that CEOs are not as concerned with competitive practice anymore. Mercer's survey of CEOs shows that reward surveys are not #1 in their mind now.

Times are changing/have changed and HR needs to understand that. We may not like it that competitive surveys are not the "bible" anymore, but CEOs are more ncerned that:
1) total rewards reflects company business strategy whether we like it/agree or not
2) critical/key (and no not all employees are key) are managed very closely and rewarded better and differently than the rest of the employee base.

HR needs to get past the age of treating everyone alike (discrimination issues aside obviously).

I think we will see a lot of our "bibles" bite the dust in the future.

My 2 cents --- or maybe 3!

Interesting points. I have to say I disagree with the initial logical argument of this post (though I agree with one of its major points I think). This post is titled, “Yahoo’s CEO Got it Right”, and the defense of that statement seems to be that:

“Yahoo’s CEO believes that people should all be physically at work to innovate and collaborate, so that is what she decided to require. Who cares if it is "competitive" or "best practice" compared to what other companies do?”

It seems the argument is that Mayer’s decision was a good one because she is CEO and she thought that it was a good one.

As their CEO, she has a right to make that decision, and I do believe she is an intelligent leader and that the management team must have considered the all of the ramifications of the decision. That said, we see CEOs make bad decisions all the time, sometimes they make really bad ones. So I disagree with concluding she made the right decision just because she thought it was right.

The point I do agree with is the statement that “If our profession ever hopes to get that seat at the table we talk about all the time, we need to put business first so that organizations and the people in them share a commitment to performance”.

And part of that is certainly not being stuck on the “best practices” of everyone else. That said, let’s not throw the baby out with the bath water. Part of our value is helping leaders to understand how competition for talent works and how that relates to the bottom line. Understanding what competitors are paying, offering for benefits, work-life, etc. is crucial. Especially as I think all these factors are only going to become more publically available to the everyday employee in the future. And while I think it would be foolish for a CEO to manage rewards based solely on “what everyone else is doing”, I think it is equally foolish (and arrogant) for a CEO to say “I don’t care what anybody else is doing, I know what is best, and that’s what we’re gonna do”. And that happens…

Jay and Pat never claimed that new Yahoo CEO Mayer was RIGHT. They merely observed that she HAS the right to change direction and HR people who place their narrow tactical opinions above the strategic decisions of the senior management team will not last long.

Their many prior studies into the characteristics of high-performing companies provide excellent contrast with the lessons from the failure cases. They just made a simple point. Bottom line: virtually all sweeping general conclusions are invalid... including that one!

I'd like to thank Jay and Pat for their views and stirring up such a lively discussion. I realize I'm a couple of weeks late to the party, but wanted to be able to share my perspective as well.

I think whether the decision was right or wrong is immaterial for purposes of our discussion. What really needs to be reviewed is how the change management process was executed. In this example, I believe the CEO got it wrong. From my understanding, Yahoo is looking for a leader to guide the company back to prosperity, rather than a prison guard, focused on the day-to-day activity of the "inmates". I get that she is trying to mold the company culture, but the process was not well thought out.

She absolutely has the right to tell employees they need to be in the office, and I think if she would have demanded this of her direct reports, it may have filtered down the organization and be processed in a more natural way. I could go down the path of her undermining her management team's ability to manage their workforce, but that's for a different discussion.

I also have a concern with the thought that understanding best practices aren't necessary to be successful in a business the size of Yahoo. My problem with discounting the value of best practices is you don't know where the bar lies. For example, a developing athlete knows where the bar is, or what is the score/time/etc/ to beat. Once they know where this bar is, they can modify their training to scrutinize and optimize their talents in order to reach the bar. Once the athlete is competitive, they refocus to ultimately launch past this "golden standard".

Even if Yahoo has no interest in continuing this "best practice" they need to understand it's existence in the industry to recognize the value employees place on it. It is with this understanding that the organization can develop a strategy to counter the wave of potential negative fallout for rescinding the benefit. Whether through developing a well thought out communications strategy, re-focusing the total rewards message or some other method, understanding the landscape can only benefit the management team.

I completely agree with the sentiments of the discussion string that HR and Compensation professionals need to learn the business and what is needed to help the business be successful. Far too often, HR executives focus on low hanging fruit and retreading old policies to lead an organization forward. To get ahead, we need to look forward for ways we can leverage the company's competitive advantages to get ahead. Re-branding the job descriptions or choosing the tablecloth patterns for the holiday party won't cut it. We need to find ways to keep our workforces engaged, motivated and dedicated to the success of the company in the most efficient manner possible.

Again, thanks for the article and thank you to the Compensation Cafe staff for allowing for such a passionate discussion.

The comments to this entry are closed.