Rethinking Compensation Training

The inadequacy or ineffectiveness of manager training is a concern for most of us -- and if it's not, it probably should be. In Towers Watson's 2011-2012 Change and Communications ROI Study, for example, 69% of companies that were labelled "low communication effectiveness" trained managers how to support the organization's vision and values through their actions -- but only 19% of those companies reported that their training was effective. (Yikes! What an opportunity for improvement.)

Since many of those working in the compensation business would rank our companies similarly when it comes to compensation training for managers, I thought I'd share a piece I just ran into on the McKinsey Quarterly aptly titled, "Why leadership-development programs fail."

Now, before you tell me manager training and executive development are two entirely different animals and you don't need to read on, let me assure you that McKinsey has given us a few nuggets to learn from. And I feel I can stand confident on this, since sometime earlier in the wayback machine, I got a few graduate degrees in adult learning.

One more thing that I want to make clear. I believe that managers who talk with employees about their performance, pay and career need to be doing so in the framework of their organization's vision and values -- don't you? After all, that's what all the work that we've been doing on pay-for-performance and total rewards strategy is meant to accomplish.

Here's a look at a few ways compensation training could become far more effective.

Avoid the one-size-fits-all training mindset if you actually want behaviors to change

Most of our training programs assume that the same set of skills will serve all managers. But that ignores the training goal of improving both the business and the managers' business skills. The McKinsey research indicates that   ' . . . the best programs explicitly tailor a "from-to" path for each participant.' 

In our world of performance management and compensation, each department or division has different employee performance and talent management demands. The from-to path that compensation training addresses should be tailored accordingly. After all, you don't talk with research scientists about compensation the same way that you talk with business operations managers. Nor do you coach employees to meet research deadlines the same way you coach employees who need to find new ways to acquire customers. Preparing managers to build business literacy and manage performance for these two employee groups should involve training customized to the business and talent demands they are facing.

Make every major project a manager-development opportunity

Who says that compensation training has to happen in a meeting room in front of PowerPoint? Why not take a pressing business issue -- staffing up, staffing down, introducing a new product, reducing margins -- and turn it into a talent management case study? Work together on how to define the new behaviors you need from employees, how to talk with them, how to measure their performance, how to talk about incentives. If it were done well, don't you think managers might be relieved to get the help?  (And notice how much more impact Compensation or HR could have as a business partner?)

Don't understimate mind-sets

We're all very savvy about what we can expect from one department or another. We shouldn't be surprised, then, if our training has little impact unless we get managers out of their comfort zone. (They have mind-sets and so do we.) Instead of presenting, listen to the way managers think about reward and recognition. Assess whether their behaviors or values are helping them manage performance or creating obstacles. Then make it possible to have deeper discussions that involve their peers, not just an HR facilitator.

Figure out how to measure results

I'm not talking about training evaluations, that's not worth our time. But the type of training described here should have some business impact, and that can be monitored. One of the great suggestions in the McKinsey Quarterly article is to monitor participants' career development after the training. Is their department functioning better because of improved leadership? How many of those who go through the training become "high potential" and so on. (And, how many of their employees do, too?)

Margaret O'Hanlon is founder and Principal of re:Think Consulting. She'll join Ann Bares and Dan Walter of the Compensation Cafe to speak  the unspoken -- Everything You Do (in Compensation) Is Communication --  in an upcoming book. Margaret brings deep expertise in compensation, career development and communications to the dialog at the Café. Before  founding re:Think Consulting, she was a Principal with Towers Watson. Margaret earned her M.S. and Ed.S. in Instructional Technology at  Indiana University, Bloomington. Creative writing is one of her outside  passions, along with Masters Swimming.

Comments

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Margaret ---- This is another great post on communication. Your suggestion for getting managers involved in a business case is very creative. I agree that traditional training seems to have questionable value.