Compensation Cafe

Cafe Classic: Margaritas vs. Employee Incentives - How to 100 Proof Total Comp Communications

Editor's Note:  Because it's Friday and because any post that combines tequila and compensation communications has earned Classic status.

Take it away, Margaret O'Hanlon!

How do you make a great margarita?

Basic ingredients

1 oz. premium or silver tequila

.5 oz. Cointreau or other orange-flavored liqueur

1.5 oz. fresh squeezed lime juice

Easy preparation

• Shake with 3/4 cup ice
• Rub rims of glasses with lime wedges
• Dip rims in a mixture of 1/2 kosher salt and 1/2 sugar
• Pour and party

Those of you who enjoy a margarita or two of a balmy July afternoon, what did you experience as you read those steps?

Anyone see the bottle of tequila? Smell the lime? Feel the hard granules of salt against your lips and the damp, cold glass against the palm or your hand? See a picture of a recent party or feel the deep sense of well being that tequila seems to spread in your veins on the first swallow?

Sights, feelings, smells, visualizations. I am encouraging you to experience them all, so you can contrast the margarita experience with another sensory experience you've had -- the new incentive rollout.

There are parallels. Really. If you have created a recipe for company success and incentive payout, shouldn't the people who are using the recipe have the same sort of emotional and visual response when you describe the ingredients? Shouldn't they be able to see what success means and preview the feelings that come with it?

Instead, here is what we usually offer up when introducing a new incentive plan:

 

Granted, there is usually more to the communications, but I've never seen anyone really pull off an explanation that inspires the kind of emotions that you'd like employees to have. The "go get 'em" sensibility that will inspire employees to accept nothing less than above-target payouts.

Can it be done? Sure. Should it be? Absolutely, if you are serious about the link between the performance targets and company results. But you've got to realize that facts (like the classic table above) do not inspire. You need to actively plan for an emotional response.

Infographics (or other types of illustrations) that instruct people about how business results align up the organization is one place to start. Most research on employee engagement indicate that this is the kind of insight they long for.

Employee conversations with managers and division heads will help make the measures real and personally meaningful. Why? Well, the personal interaction illustrates that "we are all in this together." Discussions of the choice of weightings give employees insight into strategy and organizational dependencies. Case studies and illustrative examples give employees evidence that they can do things that matter and that improve their prospects for a payout. Other case studies can show the reality of not making target.

Simplify, streamline, clarify, visualize. That means putting enough time in your project schedule for this type of work. To do this well, you will have to refine drafts and look for ways to inspire.

A November rollout is months away. You still have the time to add extra weeks to that project schedule -- and to include a milestone that involves tequila, if it looks like fun from here.

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.

One Day at A Time

Can I have a show of hands?  How many of you have ever attended a compensation conference or seminar where the speaker inspired you?  Where you were filled with ideas to transform your reward programs?

Most of you, right?

Now, how many of you managed to keep the light of inspiration burning bright one week after returning to work?  How about for two weeks? 

Ok, not many hands still raised.

Reality Sets In

The problem we face is that there's often a world of difference between the ideas inspired by a conference speaker and the realities of life where you work.  Somehow what you hear often doesn't relate to the practical world you live in.

What usually happens when you return to work gung-ho to transform your workplace?

• You find that no one picked up the ball while you were away.  So, you're immediately tossed into a maelstrom of catch-up work, putting out fires and in general just trying to get projects and activities back onto an even keel.
• The boss doesn't want to hear about the great ideas you brought back with you.  There's work to be done and you've been gone too long already.  Or perhaps the perception was that the seminar was a boondoggle get-away and the boss doesn't take the subject matter seriously.
• You're reminded that the work culture is more interested in maintaining its self-interest and status quo, and as a result, tends to stifle new ideas.  You can't find a sponsor to support your initiatives. 
• Within a few weeks, you start to think of that conference as more of a vacation with good memories than a catalyst for action.  The daunting reality of what it would take to initiate real change has dampened your enthusiasm to a whisper of what it had been.  Dust starts to gather on the conference binder.

Meanwhile, the speakers that you enjoyed so much have moved on to motivate, excite and invigorate the next batch of attendees - and the cycle of life goes on.

But it doesn't have to be this way.

One Day at a Time

Let's presume that your position on the organizational ladder is not at the top, that you cannot effect change simply by the dictum: "Make it so!"  What you're likely left with as a strategy, then, is to focus on incremental change.  Get that first down or punch out a single hit, vs. throwing for the end zone or swinging for the bleachers.

Some practical suggestions for you to consider:

• Take little steps:  If you know the direction you want to take (changes in policies, procedures, behaviors, whatever) start moving in that direction in small ways vs. abruptly shaking things up with big ideas.  As examples you could start collecting data (metrics), revise forms to be more user-friendly, modify procedures to create more transparencies; the list of minor targeted improvements can be endless.
• Educate decision-makers:  Get the decision-makers on your side by talking to them, explaining your ideas, starting with the basics.  Don't assume that they understand the foundations of your profession.  Leadership needs to be brought beyond sound bites and talking points to an understanding of compensation issues that affect the organization.  
• Develop your own strategy: Whatever it is you wish to accomplish, plan out the steps you'll need to get there; who needs to be on board as supporters, what (and who) are the barriers to success, what has been tried before, what are the likely challenges?  
• Communicate, communicate, communicate:  Don't try to recommend changes from the safety and anonymity of your office or cubicle. Get out there and interact with clients, sponsors and even resistors.  Whether it's talking to groups, preparing white papers on relevant topics, or simply exposing the dark corners of bad practices/behaviors, you need to focus on your message and repeat it, repeatedly. 
• Watch for glitches:  They are everywhere, those mistakes, unintentional consequences, and passive resistors just lying in wait.  So be ready.  No plan is perfect, no one is mistake-proof.  Ask yourself, what can go wrong?  Where should I expect complaints?   Then prepare your responses in advance. 

Becoming a catalyst for change when you can't wave a magic wand takes time, patience, and a large dose of discipline.  Anticipate that there will be setbacks and disappointments.  Learn from them and carry on.

Just take one day at a time.

Then maybe then next year you can share your own experiences at one of those conferences.  You'll have something valuable to contribute.

Chuck Csizmar CCP is founder and Principal of CMC Compensation Group, providing global compensation consulting services to a wide variety of industries and non-profit organizations.  He is also associated with several HR Consulting firms as a contributing consultant.  Chuck is a broad based subject matter expert with a specialty in international and expatriate compensation.  He lives in Central Florida (near The Mouse) and enjoys growing fruit and managing (?) a clowder of cats.

Creative Commons image, "Friends," by S Baker

Cafe Classic: Is There Value in Paying for Employee Performance?

Editor's Note:  Research gives us some interesting evidence and insights on this Classic question.

Is pay for performance - specifically that which we think of as "merit pay" - worth the hassle?

I recently ran across a research paper (Michael C. Sturman, "Evaluating the Utility of Performance-Based Pay") that takes an interesting run at answering that question. 

One of the things I particularly appreciated in this research was the authors' deliberate effort to examine the question by looking through the lens of economic value.  They observe that considering the utility of performance pay from a cost-based perspective alone (i.e., via those who rely on accounting data to guide decisions, like our cohorts in Finance) will lead to the conclusion that aggressive pay for performance is not worth the investment it demands.  They explain that aggressive differentiation in merit increases may even raise costs related to such things as turnover ("movement" costs associated with low performers deciding to separate) and salaries themselves (a higher performing workforce may cost more than the status quo).

Sturman and his team focus, instead, on creating a model that accounts for both costs and benefits (the positive impact that changes in the performance distribution of an organization's workforce can produce).  In doing so, they explore several alternates (grounded in utility analysis studies) for estimating the dollar value of individual performance variation.  This data alone, even using a more conservative estimate, is a bit mind-blowing.  Check out the chart below, which highlights the researchers' conservative estimates of the economic value of employee performance at different levels.

What this data suggests is that it takes 2 average performers (and 20 below average performers) to create the same positive economic impact of 1 above average performer.

How's that peanut butter, spread-the-budget-around merit plan looking now?

A couple of the points I take from this:

First - Let's not underestimate either the value of employee performance or overlook the importance of the performance management systems and tools that support managers in understanding and communicating with employees about their performance.  Yes, I know some of you hate performance management and the challenges associated with honestly appraising employee performance, but let's keep our eye on the ball here and not forget the importance (and economic value) that this practice has the potential to deliver.

Secondly - This should also reinforce the importance of a business-grounded HR voice, which can offer an intelligent and data-grounded counterpoint to the accounting/cost oriented assessment of practices that our colleagues in Finance might offer.

What's your take?

Ann Bares is the Founder and Editor of Compensation Café,  Author of Compensation Force and Managing Partner of Altura Consulting Group LLC, where she provides compensation consulting and survey administration services to a wide range of client organizations.  She earned her M.B.A. at Northwestern University’s Kellogg School and enjoys reading in her spare time. Follow her on Twitter at @annbares.

Plan Design Laid Bare!

Best practices for plan design? Most compensation practitioners can tick off the obvious ones on their fingers. I'm talking about: Requiring that the design helps your company achieve its strategic business and talent management goals. Interviewing executives to learn how to have an impact on the issues your leaders face. Conducting employee focus groups so you find out not only what employees think, but why. Connecting business strategy with an employee's work, so the reasons for their rewards are plain as day.

Go back through Compensation Cafe archives and you find many articles on each of these plan design parameters. There are probably even more articles that expose what happens when you take shortcuts, skipping one of these best practices.

This time I want to highlight the best practices that get talked about less frequently -- even though they are fundamental to plan success. Skip the following steps at your peril! Whether you are redesigning your base pay program or creating an incentive plan, it pays to learn from experienced colleagues, so I've included links to Compensation Cafe articles about each of these three best practices.

Spend time understanding the nature and root causes of the performance challenges that your new plan must address. Don't assume that you have all the insight you need. Analysis of divisional productivity data (followed by some manager interviews) can tell you a lot about performance obstacles, for instance. I bet there are important questions that you haven't asked yet. You'll find inspiration here:

Pay for Influence? Rewards for Retweets? by Ann Bares

Singing, Dancing and Posing: Aligning Incentives, Performance Metrics and Strategic Objectives by Stephanie Thomas

The Measurement Puzzle by Ann Bares 

Determine the success criteria you will use for new the plan. This is always a tricky one but you can make it easier by creating a two-column table. Title the first column, "The compensation plan will be considered successful if it achieves." Now list all of the outcomes that you are shooting for (I mean, all!) Side-by-side in the second column, brainstorm how you can measure success for each item. Some of your ideas will be measures, some of them will be outcomes you can describe; all of them should have a target date. Need to think more about measuring success? Take a look at these:

What If You Could Start from Scratch? by Margaret O'Hanlon

A Foundation Like a Ship, Not a Building by Dan Walter

Balancing Process and Outcomes -- How "Silo" Thinking Can End Up Rewarding the Wrong Thing by Derek Irvine

Respond to "negative influencers," otherwise known as the employees who rarely have anything positive thing to say. While they are not your main audience, they are an audience not to be overlooked. Each time you make a design decision, step back and ask yourself what the negative influencers would have to say about it. Would their viewpoint hold any water? If so, now is the time to address it. You'll never bring all your employees over to your side but you can make good progress by looking at the plan from the negative influencers' point of view and taking their views into account.

Still skeptical? Take a look:

Irked Enough to Care by Derek Irvine

Do You Have the Answers by Chuck Csizmar

Disruptive Innovation in Compensation Communication Practices by Margaret O'Hanlon

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.

Recognition is Like Drinking Water

The benefits of a single glass on an average day seem inconsequential. The benefits on a long, hot day are indescribable. Recognition programs are like drinking water.

When you drink enough water, you feel better. You think better. You perform better. You even live longer. Drinking water is such a simple thing and perhaps that’s why so many of us don’t give it the attention it deserves. We know the benefits. We believe the benefits. We have even experienced the benefits. We still don’t drink enough water.

Recognition programs can seem like small potatoes when compared to base pay, incentive plans and other elements of compensation. We often forget them while we focus on the “big stuff.” But the strongest performing companies know the secret power of recognition.

These companies understand that giving your employees a little unexpected boost can provide the fuel needed to move from the ordinary to extraordinary. Much like body quietly craves water, your staff quietly craves attention. Just like the cumulative effects of drinking enough water, recognition programs can cumulatively support performance for both individuals and entire groups.

These programs are a combination of paying attention to smaller things and providing rewards that may otherwise be unexpected. Who doesn’t want attention when they do something good? Who wouldn’t remember a nice extra that came along with the attention? (The answer to both is no one.  It wasn’t really a test.)

Recognition programs work regardless of the level of experience of the individual. They work especially well for employees who have limited, or no, access to bigger incentive programs. $100 on a random Wednesday, or being invited to a nice lunch with the CEO can be more effective than adding $1,000 to an annual bonus program. The timing and experience can magnify the specialness of the reward.

When you are determining your programs for the upcoming year, budget a small amount for rewards and a larger amount for training. Unlike drinking water, recognition programs do not work well without some EQ. Dropping something on someone’s desk, or sending a form email will not work. In fact, recognition programs can be a great reinforcer for performance management training programs.

The amounts are small enough that you can recover if done wrong. The frequency is high enough to serve as a practice ground for having performance conversations. Over time you will see better discussions happening during merit season or “stay interviews.” Such a little thing with so much potential power.

I will leave you with the tweet below from comedian @nealbrennan.

“Heard a Burt Reynolds story: He was doing VO (Voice Over) for GTA IV (Grand Theft Auto), long session, tons of dialogue, he’s sweating, tired. Producer said, ‘Burt need anything?’ Burt goes, ‘Every once in a while, just gimme an ‘Attaboy, Burt.’ Let me know I’m doing okay.’”

And that, my friends and colleagues, is the amazing power of recognition.

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He works as Managing Consultant for FutureSense. He is passionately committed to aligning pay with company strategy and culture. Dan is also a leading expert on equity compensation issues and has written several industry resources including the one-of-a-kind Performance-Based Equity Compensation. He has co-authored ”Everything You Do In Compensation is Communication”, “The Decision Makers Guide to Equity Compensation”, “Equity Alternatives” and other books. Connect with Dan on LinkedIn. Or, follow him on Twitter at @DanFutureSense.

Cafe Classic: Perverse Disincentives and Effective Deterrents

Editor's Note:  We are right to exersize caution regarding the use of disincentives and punishment, but in the spirit of bringing a breadth of knowledge and understanding to our work, it's helpful to be exposed to practical information about their use and efficacy (or lack of).  With that, we bring you a Classic lesson and real life example of perverse disincentives and deterrants via Jim Brennan.

Amid all the buzz about perverse incentives that backfire, lessons about punishments that reward undesirable performance should be shared, too. 

A former warden of Leavenworth Federal Penitentary taught me an important lesson about perverse disincentives and effective deterrants some years ago.  (No, I was NOT one of his inmates.)  As as we worked together on a project for a different federal agency, he shared his practical findings about negative reinforcement learned while trying to reduce misbehaviors among the most dangerous prisoners in the nation. 

The dilemma the warden faced was simple.  Many of the inmates under his supervision were already facing a lifetime in prision and had a “nothing to lose” attitude about rules.  The traditional remedy for serious offenses was solitary confinement.  This most severe punishment earned them positive feedback in the form of greater respect from fellow convicts.  Being sent to “solitary” was a mark of distinction, showing a level of toughness that won approval in the machismo permeated atmosphere of the maximum-security prison.  Other inmates felt that offenders who could endure weeks without human contact, living on bread and water, deserved admiration and approbation.  They were honored and respected by their fellow cons for enduring what all considered harsh treatment.  The intended punishment created a rewarding experience.   A month on bread and water in solitary was a perverse incentive.  The admiration it produced increased the probability that the offender would repeat the undesirable behavior the punishment was intended to extinguish. 

The warden made a few simple changes to disrupt the inverted perverse consequences of being sent to “the hole.”  Prisoners in solitary confinement were issued fluffy pink pajamas and fed oatmeal porridge and milk.   When they emerged from the new conditions of their “hard time,” they were met with smirks and ridicule.  Recidivism rates plummeted dramatically.  Being babied like unruly children in a manner that lowered their status in prison had a much stronger corrective effect on their subsequent behavior than the classic old treatment.  Their status in the eyes of fellow convicts was much more important to them than the discomfort of solitary confinement.  Losing prestigue was more painful than being denied human contact.  Mental punishment was more motivating than physical punishment. 

Aversion therapy will never be as popular as giveaway programs, but it still may have a valid place in our toolboxes. 

Skepticism is justified, however, since there are so darn many situations where perverse DISincentives occur.  Bad behavior is frequently rewarded in one way or another by “punishments” that create more positives than negatives, in the eyes of the performers.  A day can hardly pass without some “pop-icon celebrity” exciting their fan base by some outrageous illegal action that brings them publicity in the form of “news.”   

Those who grew up before the ancient Disney movie “Song of the South” became politically incorrect may not know the old story about the briar patch,but that folklore lesson still applies here, today.  Familiar examples may change over time, but human nature rarely does.

What other success stories can you tell about effective disincentives?

E. James (Jim) Brennan is an independent compensation advisor with extensive total rewards experience in most industries.  After corporate HR posts and consulting CEO roles, he was Senior Associate of pay surveyor ERI before returning to consulting in 2015. A prolific writer (author of the Performance Management Workbook), speaker and frequent expert witness in reasonable executive compensation court cases, Jim also serves on the Advisory Board of the Compensation and Benefits Review.

Creative Commons image "DSC1408" by HockeyholicAZ

Managers Who Don't Manage Pay

When an employee is promoted to their first manager’s position, they are given the proverbial Keys to the Kingdom.  They now have the authority to spend your money.  From the hiring, to promotions, to salary reviews, equity adjustments and beyond they are now able to render decisions that directly impact your labor costs.

However, many of these managers turn out to be well-intentioned amateurs at the process of making reward decisions appropriate to the needs of the business.   Fresh from being anointed they often lack the internal education necessary to make effective business vs. emotional decisions – and their actions commit you and your organization to costs that may not be in your best interests.

Actions taken by these managers not only increase direct costs but often irritate other staff members as the circumstances become known, creating both morale and internal equity problems.  The net result can be a corresponding loss of engagement and ultimately separations by disenchanted employees.  

Note:  Most employees leave managers, not companies.  Thus, a manager's actions do have consequences.  Likely this is not what you envisioned when you made that promotional decision.

How Did You Get into This Mess?

First, no one really trains managers on how to properly attract and reward employees via base salaries and incentive pay.

A few anecdotal examples:

• Just because someone is a good “XYZ Operator” does not mean they will be an equally good “XYZ Manager.”  The skill sets for success are markedly different.
• How many managers understand your company’s philosophy about pay?  How many understand the workings (the what and the why) of the company’s pay practices and methodology?  These are the folks responsible for spending 40% to 60% of your revenue (employee pay), and even the most well-intentioned is prone to make mistakes.
• Managers want to be liked; they do not wish to pick favorites, do not want to discriminate based on performance and do not want to have their decisions challenged.  They would rather point a finger at Human Resources and assign the blame there for having to assess performance and distinguish one employee from the other.  Left to their own devices most would give everyone as much as they could.

If you were a high performing employee, would you like to work for this Manager?  On the other hand, if you were coasting at work, barely putting your time in, how would you feel?  Which employee will eventually tire of being undervalued and quit?   Which would leave the Manager staffed with Joe Averages. 

Ineffective managers are afraid that an unhappy employee will decide to quit.  Their prime concern is what the departure would mean to their deliverables, to their reputation as a manager.  A departure is typically viewed as an inconvenience for them, not an avoidable loss for the company.  A reflection of this viewpoint is when managers resist granting a transfer that is clearly in the employee’s career interests.  The manager’s concern is how that transfer affects their department – and whether their own personal success would become more difficult to attain. 

Ineffective Managers can also be a defensive lot, quick to challenge any attempts at reform.  Why?  Because of their fear that reform action will uncover their ineffectiveness, and that exposure is worth resisting.  Typically, their in-house advantage is that the more ineffective the manager, the stronger their political connections.   And as senior management oftentimes surround themselves with those most agreeable to their own way of thinking, it’s not surprising.

Corrective Action

Assuming the company’s willingness to make key decisions, and the presence of all-important support from senior management, companies can act to correct the problems that they’ve created. 

• Select candidates for management positions based on capabilities to deal with actual management issues (people interaction, managing projects, business-oriented, professional demeanor, etc.).
• Educate Managers in the philosophy and methodology of the organization’s pay programs, ensuring that this information is shared with their staff.
• Construct job specifications that call for a Manager to manage, as a prime accountability, limiting or even eliminating the retention of individual contributor responsibilities.
• Measure and reward manager performance primarily based on how they have managed their employees, or on the performance of their unit.
• Encourage Managers to develop the potential of their employees, to the point that a staff member being promoted is a mark of success for the Manager.
• Ensure that procedural checks and balances are in place to ensure that pay decisions are reviewed at least one level higher.
• Hold Managers to an annual salary increase budget; let them help develop and monitor it during the year.

Consider the above as a checklist that can be used to test your organization’s vulnerability to wasted money, employee morale problems, turnover, and avoidable cost increases. 

My advice to clients is to face these issues straight on, to implement policies and procedures that save money without penalizing high performers or mistreating their employee base.  But the challenge will always remain, as there is an inherent reluctance on the part of many managers to make the tough decisions because we do want to be liked, we do like to give good news, and we do not like to play judge and jury with an employee’s career.

Chuck Csizmar CCP is founder and Principal of CMC Compensation Group, providing global compensation consulting services to a wide variety of industries and non-profit organizations.  He is also associated with several HR Consulting firms as a contributing consultant.  Chuck is a broad based subject matter expert with a specialty in international and expatriate compensation.  He lives in Central Florida (near The Mouse) and enjoys growing fruit and managing (?) a clowder of cats.

Creative Commons image, "942217_1015285940," by Dan Mantyla

Conference Topics To Meet Every Need - Part 2

Editor's Editor's Note: Today's post comes to us courtesy of guest contributor Chris Dobyns, as Part 2 of a two post series where he shares his impressions and takeaways - and particularly his top picks for breakout sessions - from the WorldatWork 2019 Total Rewards Conference and Exhibition, recently held in Orlando, Florida. Did you miss Part 1?  

The WorldatWork 2019 Total Rewards Conference and Exhibition wrapped up last week, hosted at the Rosen Shingle Creek facility in Orlando. The conference attracted approximately 2,000 attendees, comprised of speakers, practitioners, academicians, consultants and exhibitors.

The Breakdown On The Breakouts

The breakout sessions that I attended were all uniformly above average, or better. There were a couple of sessions, however, where the workshop title, the actual content – or both - deviated from the title on the official schedule or the original session summary enough that attendees were left wondering if they were actually sitting in the right room.

This “variance” is probably due to either a misinterpretation of the expected content by attendees or, more likely, that “things” (content, speakers, perspectives, etc.) changed in the six months between the conference and when the original workshop proposal was submitted and accepted. These things just can and do happen.  

The Top Three 

Of the approximately 85 individual breakout presentations offered this year, I made a concerted effort to attend one session in every available timeslot. Even so, that only allowed me to assess (and “rate”) about one-tenth of the actual presentations. Given that small sample size, these are my top picks for 2019. 

1.  My 1^st place pick was, The Lens of the Future: Transforming Total Rewards into a First-Class Service, presented by Antonis Christidis from Mercer, Inc. I was initially worried about this presentation, as one co-presenter had been pulled away at the last minute for work-related reasons, leaving Antonis to carry the whole show. Ultimately this session was successful through some artful story-telling, a novel concept and the use of an illustrative and highly-relatable graphic. 

• This workshop reflected Mercer’s speculation on the future use of Organizational Network Analysis (ONA) as the basis for better valuing (and paying) for skills based on the sustained strength and frequency of formal and informal asymmetric relationships that exist in an organization
• This would be in clear contrast to the prevailing practice of paying for jobs relative to a person’s placement in a vertical hierarchy.
• Less clear was how to account for the “quality” of the network relationships and how to factor in any aspect of individual performance. Regardless, I thought this was one of the most novel and well-presented concepts I saw at the conference this year.

2.   Next up was the hugely fun Pay Equity, Privilege, and Unconscious Bias, presented by Bryan Briscoe from Interface, Inc. This session was part of the first-time Power Half Hour presentations, to demonstrate that some conference content lends itself better to a half-hour format.

• Apparently benefiting from a mix of urban legend, “crowdsourcing” and je ne sais quoi, this session drew a huge audience well north of 500 people.
• This was a super presentation that struck just the right balance of respect for the importance and seriousness of the topic, juxtaposed by a series of humorous interludes that provided the perfect balance of comic relief. 

3.   My third pick was Comp Nerds Play with Data: Meaningful (and Fun!) Analysis for the Rewards Professional, presented by the now familiar team of Bryan Briscoe and Paul Reiman from Commvault.  

• This session began with some insights into what differentiates Nerds from Geeks . . . and which category is more “marriageable” (it’s the former) – which purportedly includes Paul and Bryan.
• This presentation was an informative and fun mix of all-too-common statistical and data visualization missteps and how to avoid them.
• The funniest example of the danger of attributing correlation to causation was how increased ice cream sales during the year is directly correlated with an increase in the number of shark attacks. Just don’t ask.
• The funny/edgy quote comparing artificial intelligence to teenage sex made a repeat appearance – and was even requoted by presenters in two subsequent workshops at the conference. Imitation. The sincerest form of flattery.

Double Your Fun

Doing justice to attending all the relevant workshops at the conference realistically requires a 2-person team. Understandably, organization budgets do not always allow this luxury. Whether just one or many, conference attendance provides an excellent opportunity to see and hear about leading edge practices and to make valuable industry contacts that can expand your professional network. Maybe equally important, the conference provides a chance to refresh, reenergize and have some fun, because there’s literally something to meet every need at these conferences. 

Everyone probably has a different perspective.  What’s yours?

Chris Dobyns, CCP, CBP is currently employed as a Human Capital Strategic Consultant for the Office of Human Resource Strategy and Program Design for one of the largest U.S. intelligence agencies. The Office of Human Resource Strategy and Program Design is responsible for organizational effectiveness, personnel assessment, compensation and incentives, occupational structure, recognition and rewards, HR policy, human capital program design, implementation, evaluation and assessment and internal consulting. Chris has worked in the area of compensation for more than 35 years, and has been employed in various compensation-related positions by a number of large, private sector companies including, Sears, Roebuck, Arizona Public Service and Westinghouse Savannah River Company.

Original "Conference Themes" image adapted from WorldatWork by Chris Dobyns.

Conference Topics To Meet Every Need

Editor's Note: Today's post comes to us courtesy of guest contributor Chris Dobyns, as Part 1 of a two-post series, where he shares his impressions and takeaways - and particularly his top picks for breakout sessions - from the WorldatWork 2019 Total Rewards Conference and Exhibition, recently held in Orlando, Florida.

The WorldatWork 2019 Total Rewards Conference and Exhibition wrapped up last week, hosted at the Rosen Shingle Creek facility in Orlando. The conference attracted approximately 2,000 attendees, comprised of speakers, practitioners, academicians and exhibitors. Attendees came to get the latest news and innovations in the area of compensation, benefits and work-life practices.  This year’s workshops were aligned around the four key themes of Learn, Solve, Disrupt and Envision.

The conference kicked off with the standard events, beginning on Monday AM with a remarkably good plated-breakfast (it is the most important meal of the day). This was followed by a conference welcome and remarks from association President and CEO, Scott Cawood. Scott emphasized the need for both improved awareness and preparation for the transition to a digital economy, given the expected exponential growth of technology in the next 3-5 years. Organizations were encouraged to continue to fine-tune (or perhaps just begin) their digital strategy development, particularly with an eye on the future implications for the total rewards space.

 You Are Enough

Keynote speaker, Chris “Bash” Bashinelli, followed and advocated conference attendees to endeavor to walk in the shoes of a global citizen, which is exactly what he has done as a “20-something year old” in his global travels for PBS – both literally and figuratively over the last several years. He encouraged the audience to Stop, Listen, Learn and look to make connections with others to understand their perspective. Then, do your best  . . . and that will be accepted.

2019 Workshop Focus

Individual conference workshops were once again centered around the topical categories of: Benefits, Compensation, Executive Compensation, Sales Compensation, Total Rewards and Workforce Experience.

There weren’t too many surprises this year regarding the topical focus of individual workshop sessions. As expected, some clear themes and trends emerged around the topics of gender pay inequity, unconscious bias, data analytics/visualization in support of improved understanding of pay, organizational value and maintaining competitiveness – to retain top talent.

Technological advances provided hints at future inroads and areas ripe for automation, but no innovations met the definition to be categorized as “artificial intelligence” yet.  There were some sessions that reflected nascent machine learning or robotic process automation, either in current use or actively being contemplated.

Terminology Shifts, Twists and Turns

The broader term “well-being” appears to have supplanted the term “wellness”, in generally describing employee health and state-of-mind. And in acceptance of what is apparently now considered the “new normal”, the former terminology work-life balance has all but been replaced by what is probably the more accurate phrase, work-life integration. This trend tacitly acknowledges the continued pervasiveness of technology and the difficulty for employees to realistically separate work from their regular life activities. 

Lastly, there was a noticeable emphasis on the escalating importance of financial counseling for employees, principally to help them prepare for retirement and better withstand financial hardship events. The 500 lb. gorilla present in at least two workshop sessions was the continuing concern about the $1.5 trillion in student loan debt, and how that is effecting employees practically and psychologically – particularly employees in entry-level positions.

Anecdotal Audience Observations

A couple of noteworthy trends appeared to be on the rise in terms of the audience demographics, although these observations are admittedly about as unscientific as they get.  Based on attendance at now four of the last five conferences, the gender demographic would appear to reflect that women comprise the majority of the attendees. The accuracy of this observation and if women also comprise a majority of the demographic in the total rewards profession remains unclear.    

A slightly more scientific observation was the discernible number of first-time attendees at the conference. In both the General Session as well as a heavily-attended breakout, by an informal census close to 40 percent of the attendees self-identified as being the first-time attendees to the Total Rewards Conference this year. No additional conclusions or inferences are supported, but both observations are perhaps interesting artifacts. 

The Top Workshop Picks for 2019

In a repeat of last year’s conference summary, Part 2 of this article will focus on individual workshops and the handful of topics and their respective presenter [teams], and what really separated these sessions from the rest of the pack.  Stay tuned for the next continuation of the series – and the big “reveal”. 

Everyone probably has a different perspective.  What’s yours?

Chris Dobyns, CCP, CBP is currently employed as a Human Capital Strategic Consultant for the Office of Human Resource Strategy and Program Design for one of the largest U.S. intelligence agencies. The Office of Human Resource Strategy and Program Design is responsible for organizational effectiveness, personnel assessment, compensation and incentives, occupational structure, recognition and rewards, HR policy, human capital program design, implementation, evaluation and assessment and internal consulting. Chris has worked in the area of compensation for more than 35 years, and has been employed in various compensation-related positions by a number of large, private sector companies including, Sears, Roebuck, Arizona Public Service and Westinghouse Savannah River Company.

Original "Conference Themes" image adapted from WorldatWork by Chris Dobyns.

Deepen Your Value to Your Company

Do you want to become famous in your company for (pick one or more): Competitive compensation knowledge, talent acquisition, strategic insight, leadership?

Start by learning all you can about your organization and about our field's innovative compensation practices, but don't stop there. Recognize how much more valuable you would be as the in-house expert on your organization's competitors. 

Business growth comes from competition, so knowing your competitors will prepare you for deep insight into your organization's zigs and zags -- and for foreseeing the talent shifts that your organization will need to take. Learning from your competitors' successes and failures can save your organization time and money. And knowing both the "what" and the "why" of your competitors' culture, total rewards and talent strategy will make you better prepared to win the recruitment game.

Start by identifying your competitors (with Forbes help). There may be more than you think.

Direct competitors share similar products or services, and market to the same customers or audiences. Organizations rarely get to recruit key players from direct competitors, but when they do the big question is always, "How well will they fit in?" Once you are a competitive expert, you will be able to answer the question and better qualify these expensive new hires.

Secondary competitors either reach out to different customers or offer a slightly different product or service, usually higher or lower end. These organizations are potentially the richest talent pool for your business, but it's critical to understand how different the competitors' current culture and career opportunities are and why.

Tertiary competitors are only tangentially related to your business, but could be great sources for administrative staff -- and employees in human resources and other jobs that are common to the two companies -- whose experience should help them hit the ground running.

Even if your colleagues speak often about competitors, their insights may be second-hand or dusty, so plan to do your own research if you really want to become an expert. Where to start? Each category of competitor has worked out a branding that distinguishes them from your organization. Understand the marketing rationale for that distinction and how differently they staff because of it.

Taking the research further, learn how your competitors make money since the answer may be very different from your organization's approach. If they make their money through high margins and your company makes it through high volume/low margin sales for instance, employees will be trained to prioritize decisions in a very different way.

What are your competitors' strengths and weaknesses? Has your organization successfully positioned itself in relation to them? Do customers see these distinctions clearly? How can you explain the comparison to candidates? How should it affect new hire compensation practices?

And let's not forget existing employees. Your competitors' strengths could be appealing to them, too. Think about what you're doing in terms of culture, total rewards and talent strategy to distinguish yourself from your competitors.

As the in-house expert, you should have a strong, well-researched opinion. Do you think your organization is doing what it should to attract and retain?

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.