Editor's Note: Our end-of-summer Classic week continues here, with Jim Brennan's insightful post about the temptation (fed by leaders and line managers alike) to treat every problem as a pay issue -- and the challenges we encounter when we try to push beyond the easy/obvious to evaluate what's really happening.
My esteemed colleague Mercedes McBride-Walker signs her emails with this slogan:
"95% of the time, the issue is something other than money. So why am I not out of a job?"
She makes a very good point.
Most of the people I hang with are still pretty much compensation people rather than Talent Managers or Total Rewards professionals, so when they are presented with a problem, guess what gets addressed first? Their instinctive first “fix” is usually to throw money at it. It’s almost like we were politicians.
When your only tool is a hammer, every problem looks like a nail. Those whose power and authority comes from compensation expertise tend to rely excessively on that element as the universal cure for all ills. It becomes the same old story… first you give them money … then, when that doesn’t work, you try other solutions until you finally work your way down to the real causal agent, by trial and error and at great expense of time, effort and money.
We are not the only ones at fault. It is all too easy for managers to assume that pay can solve any problem. Even when they are wrong, the recipient of the inappropriate largesse will typically display some gratitude and may demonstrate temporary improvement. Plus, even if higher pay doesn’t create a compression wave, the manager still gets a bigger budget. Those who correctly identify a solution that does not involve compensation face an immense amount of resistance to any fix more difficult than simply writing a check. After all, if an issue can be corrected with cash, it is not a management problem but only a cost item.
Not until I held credibility as a compensation expert would anyone believe my claims that pay was usually not the issue in any given situation. Realistically, if you don’t deal with compensation first, dispelling that as the solution, no one will listen to you; all will claim it’s simply a matter of money.
We human resources people still have a terrible habit of prescribing solutions without ever performing a diagnosis. The seductive temptation to throw money at every problem cannot be defeated without strong and confident compensation people willing to reject inappropriate solutions.
Ironically, we need more pay experts in order to correct non-pay problems.
Do we have them? And will we continue to grow them?
E. James (Jim) Brennan is an independent compensation advisor with extensive total rewards experience. After corporate HR jobs and consulting in every industry throughout North America, he was Senior Associate of pay survey software publisher ERI before returning to consulting in 2015. A prolific writer (author of the Performance Management Workbook), speaker and frequent expert witness, Jim testified in many reasonable executive compensation cases. He also serves on the Advisory Board of the Compensation and Benefits Review.
Image: Creative Commons Photo "my to do list" by koka_sexton
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