What If You Could Start from Scratch?

Most of us live in "brown fields" where we plow up old ground and figure out how to plant something new on it.  But imagine what having a "green field" would be like. Unencumbered by the past, you could start a compensation program from scratch, making your own decisions instead of fiddling around with (or tripping over) existing ones.

A client called recently who has just that opportunity. She's working at tech startup that's growing healthy roots. Leadership is wise enough to notice that as the total number of employees moves toward 100 globally, they need to quit limping along, making one-off job offers, and develop a compensation system.

It's a heady place to be, starting from scratch. You can go as far as you want -- variable pay, options, flexible work/life tradeoffs, etc. Or you can stick to the fundamentals, focus on getting the competitive picture solid and build a salary structure that will stand up to the elements -- hot jobs, greedy high potentials, quixotic job market, snowballing recruiting -- or, or, or . . .

I'll tell you the advice that I passed along in a sec. But it occurred to me, almost as I put down the phone, that it clearly came from my own experience. I often work with companies that are moving from one phase of their maturity to another. Even when they are early stage, each company is struggling to find the courage, time and money to plow up old fields and plant some new ones.

My advice to this start-up was a bit long term, which is often a difficult view for people who are more than ready to get rid of some of the anxiety that grows from staring at the empty field in front of them. Tell the story of your staffing plans for the next year or two, I advised. Analyze your business plan and envision who you are going to want to hire, how many and where. More importantly, imagine what the company will be doing in two years and how you can link those employees to it so your reward practices help to build the "way we do things around here."  Use your vision of the future to design the goals and project plan that will get you to a compensation program that supports achievement of your business strategy.

I think I can read your mind. Nothing out of the ordinary here . . . but that's not the only advice that I passed on.

Research has indicated that skill and career development have been growing in value to employees over the last 10 years. In fact, it is often listed right after pay when employees are asked to rank what they value the most. There's more to it, I'm sure, but one thing is clear. It just makes sense, in a job market like this, that an individual would want to learn how to become more and more employable, even to her/his current employer. (Job security shows up high on employee preferences these days, too.)

So, here's the other advice that I passed along. As boring as job definition and documentation might be in any project, it can provide you with as much of an operational infrastructure as a salary structure does. If designed based on behaviors and competencies rather than as a mind-numbing administrative document, the information can be analyzed and organized to support really innovative skill and career development initiatives. Each time I work with clients to develop career path and skill development programs, they are amazed at the insights that this approach to job documentation can provide employees and managers.

OK, now that you know what my advice was, you may be squirming in your seat, ready to tell me how your idea would help a newbie even more. Why not treat this colleague to your experience and send some of you suggestions along, too? I'm sure you have your own insights that can help this company create its future. Plus, how often do you get to speak your mind about your own vision for a green field?

Margaret O'Hanlon, CCP 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 so ready to be released in the coming weeks. 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

[Jay Schuster]

Looks to me that your client is fortunate to have turned to you for guidance. About the only 'thing' I would suggest you consider is to find some better way to build a foundation for pay other than 'job definition'. Obviously my bias would be for a 'skill/competency' foundation. I can think of nothing more negative that starting out by 'writing job descriptions'. I can just imagine the CEO saying, "My goodness, take me to the dentist instead".

What is super is that you are not going to need to 'sell' them whatever solution best fits your own business model and talent capability. You can offer the 'thinking person's solution'. Three Hooo-Ha Cheers for you!!!!!

[Margaret O'Hanlon]

Jay, thanks so much for your affirmation. I really appreciate it and the company will benefit from your encouragement.

[John A. Bushfield]

Margaret - Good advise, all of which makes sense. I would approach it from a slightly different perspective. Develop a pay philosophy that supports the culture you are trying to build. Decide HOW you want to pay people rather than WHAT you may want to pay. Make sure that it aligns with the mission/values that the company has established (no values? Oops; best circle back and drive that stake in the ground). A well thought out pay philosophy will provide good guidance as the company grows and matures, and serve the company through thick and thin.

[Margaret O'Hanlon]

John, I find that this is an especially difficult thing for startups to remember. Leadership often tries to game the system to get the salaries for "their people" but not admitting that they are just making it a numbers exercise. Thanks so much for calling this out.