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11/18/2019

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AMEN!

Jim,
I appreciate the step-by-step instructions on this approach that you provided in your book.

Some organizations utilize a forced placement of ratings in order to replicate a normal distribution (bell curve). In my view, that approach is more about budget management not performance management.

The "Brennan Payout" approach will match the salary increase budget (to the penny) without forcing managers to alter their ratings in order to fit the budget allocation.

Thanks for sharing your wisdom.

Jack

Pleased to learn that you took it to the next step, Jack! One of these days, someone will "suddenly discover" it and force-feed it down their clients' throats until all have abandoned the ugly forced distribution edicts and the awkward merit grid techniques.

Glad to hear that you also found value in it... hopefully during the years that my book royalties were still in effect! It sells for less than the postage cost, today. LOL!

Thank you for sharing this information! It's a different approach and I agree with the logic behind it, I'm considering how this change could work at my organization.

For those who agree that this approach seems promising to simplify communications about equity (same amount for same performance in same-valued jobs) without the prejudicial effects of past years, I suggest some Beta Testing.

Carefully select some unit with a smart articulate supervisor who wants to volunteer his section for a trial run.

Do some preliminary rehearsals, pitching all the possible objections and protests you can imagine. If you can't think of them, I'll give you a bunch of samples, like "us highly paid senior people deserve a bigger piece of the pie because we're fatter"... I mean, "..because we ALWAYS get a bigger raise for the same level of performance as a mere beginner in the same job we have."

Run the concept past your upper management to feel them out and keep them in the loop so you don't go behind their backs. Ideally, you would have a slight premium added to the budget for the volunteered section or group, to supply an incentive to the manager to test it. Their pleasure at the subsequent clarity and improvement of the prior relatively unjustifiable internal equity relationships should win the day for expansion.

This simple approach is ideal to deftly dodge the awful compounding effects that drain off the majority of merit budget distributions to senior incumbents who are outperformed by starving junior peers. Without the eminently "fair" grant of identical actual raises to same-grade identical performers, higher-performing juniors will never catch up with the already grossly overpaid seniors who can coast while the beginners who outdo them without equal reward consequences will soon despair and quit.

P.S. At the end, I should have said "will face continuing wider gaps" rather than "catch up".

Identical absolute merit amounts for performance of identical quality in identically graded/valued jobs will never close the existing lead of longer-service ("senior") peers, but it will reduce the wildly disproportionate merit budget allocations to historically more prosperous peers. The gap earned by many years of consistently high performance remains, rightly... but it is NOT right to continue to "over-reward" them just because they have accrued a base income at a high compa-ratio level.

Divert more cash to the young struggling new high achievers rather than starve them to stuff more in the pockets of the already-rich.

That's the basic selling point. It can be clearly and simply demonstrated by showing Excel projections showing the difference in relative/absolute outcomes between the old method and the new "Brennan" solution over a number of years. I created one such demo years ago.

As others have noted, it also completely eliminates any need for forced performance distributions in any simultaneous merit-based pay distribution. That's the bigger background topic.

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