Have you just invented your company's first salary structure? Market tested your incentive rates?
If the answer is yes, odds are your company has 200 to 500 employees. There are two, or if you're lucky three, people in Human Resources, but there could be only one. You're thrilled that you just finished a great big project that will make employees and managers happy. After all, now they'll finally be confident that you are paying competitively -- right?
Ummm, not so fast. Experience tells us that no matter how competitive your new program is, that's not a bet you should place.
It's not that employees don't trust you, it's that they don't have any reason to, YET. Before you introduce the new, industry-standard compensation plan, how does compensation work in the company NOW? Truth is, employees have noticed that there were inconsistencies and it has tampered with their trust. They are bound to have misgivings going into the new program and may see problems where there really are none.
Founding employees were probably way above (or in a few situations, a good bit below) market rate. After all, when there were fewer than 100 employees, you were running as fast as you could to staff up. Your pay philosophy was pretty much, "Yes, you should work here." Not so sophisticated, and bound to cause problems in the medium-run when you aren't quite as desperate for live bodies.
By the time you have 100-200 employees, you've decided to check your offers with some market data. But odds are, it took a while before you were able or willing to pay for GOOD market data. So employees have been through the era of Human Resources talking about competitiveness while hoping no one will notice that their fingers are crossed behind their backs.
What have you been saying to employees about their compensation in the meantime? That your salaries were highly competitive, of course. You certainly couldn't have said that you really didn't have the data back that up.
Why am I bringing this up? To remind you that it's unwise to think that a good, or even great, compensation program speaks for itself. Instead, realize that employees in early stage companies are usually very willing to speak for themselves. As far as they can tell, their salary is good enough to get them in your door but not so good that it shouldn't be questioned. And they WILL question it, pointedly.
Belief in the new program will not come just because it is still pretty and shiny. The merits of the new salary structure may be obvious to you. Your job will be to get your employees to agree with you. And certainly not "just because you say so" in one presentation.
Research indicates the shift from announcement of an organizational initiative to adoption of the initiative by an individual employee will involve these stages:
- Awareness
- Understanding
- Buy-in
Notice that the first step, "Awareness," is defined as, "Knowledge of a situation or fact." In the "Awareness" phase, there is no meeting of the minds yet, just information sharing.
So don't be disappointed when your bold new program isn't met with cheers. Instead plan to get there in stages, realizing that awareness also doesn't equal encyclopedic knowledge. The first round of communications is no time to get fancy with transparency, which will just be overwhelming to many employees.
Instead, it IS time to raise consciousness by providing an overview (one that managers can appreciate, as well). At that point, people will be eager to hear more -- specifically, what the plan overview means for THEIR pay. That means you need to be ready to build understanding and buy-in via smaller groups, with the help of managers who will back you up, no matter what.
No matter how enthusiastic (or panicked) you are about introducing your new program, design a communication strategy that has stages. Then announce the stages at that first, all-hands meeting, so it's clear that you will work with employees until shared understanding is achieved.
Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Her firm, re:Think Consulting, provides market pay information and designs base salary structures, incentive plans, career paths and their implementation plans. Earlier, she was a Principal at Willis Towers Watson. A former Board member for the Bay Area Compensation Association (BACA), Margaret coauthored the popular eBook, Everything You Do (in Compensation) Is Communications, a toolkit that all practitioners can find at https://gumroad.com/l/everythingiscommunication.
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