Compensation Cafe

Change is Power

ERI recently published the results from a survey on the impact of COVID-19 on compensation. It was the first report I have seen that showed some actual pay movement as a result of the ongoing pandemic. More telling were the more than 65% of companies who were either progressing with the plans they made at the beginning of 2020 or had not yet made any decision on what to do.

We have entered the second week of November 2020. If you throw out the two-weeks of holidays for Thanksgiving and Christmas/New Year, we have about 5 weeks to prepare for 2021. Not having a plan, is a great way to lose in the battle for talent and success. You seldom watch movies or read stories about the times people did absolutely nothing and somehow met their goals. This is because it almost never happens.

Change is your competitive advantage when others are paralyzed by indecision. Action is your secret sauce for success when those around you are simply too lazy to do something different. Whether we like it or not, the world is a much different place than it was just a year ago. We will never fully return to those heady, coronavirus-free, yesterdays.

Remote work is here to stay. What that means for your company is probably unique, but change is a must. Pay will change. Work-life balance will adjust. Ignoring this will not make it go away.

Unemployment will remain higher than it has been for several years. This tends to put downward pressure on pay.  It may also mean a greater talent pool for some industries. Staying ahead of the market may be easier and allow you to hire materially better talent without spending a fortune.

Now is the time to fix your worst incentive plans, or adjust pay structures that have crumbled under the weight of furloughs, lay-offs, remote work, shrinkage, growth, or any other of the myriad of issues that are being faced in business. Yes, you are tired. But so are your competitors. The best time to win is when they can’t respond. In a world where increases have been in low single digits for a decade, it doesn’t take too much to set your company above the crowd.

Change will happen. The question is whether it will happen TO you, or BECAUSE of you. The former isn’t much fun and the latter puts you in control. As you move into finalizing things for 2021, consider one or two big things that will allow you and your company to set yourselves apart. When everyone else is paralyzed, it won’t take much to do something that makes difference.

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He has convinced himself he is a “Compensation Futurist” and works as Managing Consultant for FutureSense. Dan is also a leading expert on incentive plans and equity compensation issues. He has written several industry resources including the only resource dedicated to 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.

A Finger on the Scales of Remote Work and Work-Life Balance

We all knew it was bound to happen. Science fiction movies have been showing scenes of people working from anywhere for years. At the same time, futurists have been predicting that increased technological productivity will reduce the need for humans to work as many hours. Well, we are finally working remotely and work-life balance is 100% fixed. (right?)…. 2020 has been a big, fat, finger on the scales of remote work, and a bit of a heel grinding down on the scale of work-life balance.

So what does this have to do with compensation? As we have already discussed here in the recent past, paying remote workers in our new environment will require some new thought. A bigger issue may be figuring out to properly pay and reward the most highly productive when you no longer have the ease of patting them on the back or giving them public recognition. There is no doubt that the biggest issue is work-life balance. Solutions to that issue will require new thoughts on compensation succession planning and workforce tools.

Paying remote workers, when remote isn’t a “privilege”, but instead is a rule, requires some soul-searching by HR and Compensation professionals. Do our traditional job descriptions accurately portray a job being performed from someone’s sofa or basement? Are Geo Differentials a reasonable (and competitive) method for determining pay levels for our newly mobile workforce? In this case, we probably have 90% of the information we need, but we have not yet reorganized that information into something that is truly useful.

Paying our most productive workers has always been a challenge. It is likely that the remote world will expose the laggards and stars in ways that were harder to see when people worked in a group. I am predicting that pay ranges will widen as we tamp down on the pay of the slowpokes and ramp up pay for the fastest. The most productive workers are often those we ask the most from. This means, that without coaching on how to manage virtual workforces, we will likely overwork our productive people in our efforts to keep things stable and moving forward.

Work-life balance will be a doozy. Some companies will bring everyone back into the office before the end of 2021. Some companies will keep people working remotely perhaps forever. If you have been working from home, you know it isn’t always wine and roses. Your computer is too close to your living room or backyard. Your days can stretch from long before you are ready to be awake, to long after your kids have gone to sleep. Your life and work have merged into a blob of working, cooking, Zooming, cleaning, teaching, rinsing and repeating. None of this is healthy or sustainable and money can only fix some of it.

As we engage in our annual compensation planning exercises, it is a good time to start discussing some of these issues with the stakeholders on your team. Our final approaches will probably take a few years to fully work out. Broadly enacted remote work will change the competitive talent landscape forever. Those who fall behind may never get an opportunity to catch-up. Let’s change compensation and make it better. We can either take advantage of the thumb on the scales of remote work or be ground under the heel of work-life balance. Either we fix this, or no one will.

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He has convinced himself he is a “Compensation Futurist” and works as Managing Consultant for FutureSense. Dan is also a leading expert on incentive plans and equity compensation issues. He has written several industry resources including the only resource dedicated to 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.

The Lessons of a Dog's Breakfast

Editor's Note: Today's post comes to us courtesy of guest contributor Chris Dobyns.

The phrase, A Dog’s Breakfast, is probably unfamiliar to most Americans, as its use and origin is probably better recognized and understood throughout the United Kingdom. The exact source and the predominance of the phrase’s use in our workplace is a mystery, except for a widely held belief that it may have been “carried over” by staff members who have served in expatriate assignments with one of our British “subsidiaries.” 

The underlying meaning of the phrase will quickly become apparent to anyone who has ever owned a dog.  For you cat lovers, the fact is that most dogs eat every meal with a level of single-minded enthusiasm that would force you to conclude that the dog genuinely believes that, “. . . this may be my last meal”.  Consequently, a post-meal overhead view would prompt the uninitiated into thinking that a small explosive device had been detonated somewhere deep beneath the “kibble” – evidenced by the ring of uneaten dog food fanned out around the dog’s bowl in a nearly perfect concentric circle. With that mental picture established, you’ll understand that, A Dog’s Breakfast = A Complete Mess. 

All interesting you might say, but what’s the linkage between canine eating habits and anything related to compensation and total rewards?

Let’s assume that on rare occasions, “things” don’t always go quite as planned at work.  Whether that’s in the planning and development of a new incentive plan or the rollout of a change to medical benefits, or when the execution of the tools or communications to support one of these initiatives is a little rough. And sometimes, the outcomes simply aren’t quite what had been hoped for. Depending on the organizational impact, these imperfect results will occasionally warrant being characterized as A Dog’s Breakfast (a complete mess).

What Comes After Breakfast

Organizational reactions to A Dog’s Breakfast vary. Punitive organizations will often hold individual(s) accountable for these failures, imposing a range of penalties, in order serve as an object lesson to forestall similar failures by others in the future. 

More constructive-minded organizations recognize and treasure the value of experience in its employees.  And where does that experience come from?  Experience is most typically a cumulative by-product of exercising good judgment, in evaluating choices and making decisions. And as part of the iterative learning process, good judgment in evaluating choices and making decisions is usually the product of past instances of exercising bad judgment, and making less-good choices. 

Sound Choices Produce Superior Results

It is through this iterative process of positive and negative reinforcement, that human beings learn, gain experience, and regularly make good choices.  And while most people, especially children, learn equally well from a mix of both positive and negative reinforcement, adults appear to integrate and learn best from positive reinforcement. 

To be optimally effective, experiential learning ideally needs to encompass all employees.  Perhaps more importantly, senior management must empower workers to exercise good judgment in a variety of scenarios they may encounter. 

Empowerment is best operationalized when management establishes an easy-to-understand framework or context that helps guide employees and enable good choices in specific situations.  One such industry framework provided to employees by management is The Golden Rule, used by the Four Seasons Hotels and Resorts.  Beyond the simple lesson drawn from childhood of treating others as you would want to be treated, The Golden Rule also includes the following to further help employees make good choices on behalf of its guests:

• Explain the desired choice that has been made, and the rationale behind it, in order to ensure better understanding and acceptance
• Immediately begin to identify the next choice or decision required, by you or others, in order better inform the subsequent choice hierarchy
• Management should assist in making downstream choices, if needed
• Be willing to assess and modify the choices made, based on the feedback received, to make better decisions in the future

Consequently, organizations which encourage taking balanced risks, treat employee mistakes as opportunities for learning, and empower their workforces, will end up with employees who have greater experience, are more predisposed to exercise good judgment and make better choices – and who will be more likely to avoid A Dog’s Breakfast.

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.

Image courtesy of fotolia, "Eating With Gusto" by Paulo Saludo

Cafe Classic: The Power of Positivity at Work

Editor's Note:  We bring you Derek Irvine's Classic on the power of thanks in the workplace.  How is yours doing?

Have we moved past the hard-boiled workplaces where screaming bosses, ridiculous deadlines and 80-work-weeks are the norm? Have we done enough to prove engaged, happy employees are more productive and more inclined to deliver on needed success metrics?

I like to think so, but then I begin to worry over those who discount the importance of positive and the Power of Thanks in the work place. So today, I point you to an article on the Harvard Business Review blog that reminds us that simply being kind to others actually is a strategic business decision. From the article:

In a research article published in the Journal of Applied Behavioral Science [Kim} Cameron and his coauthors [at the University of Michigan] found that a workplace characterized by positive and virtuous practices excels in a number of domains.

Positive and virtuous practices include:

• Caring for, being interested in, and maintaining responsibility for colleagues as friends.
• Providing support for one another, including offering kindness and compassion when others are struggling.
• Avoiding blame and forgive mistakes.
• Inspiring one another at work.
• Emphasizing the meaningfulness of the work.
• Treating one another with respect, gratitude, trust & integrity.

Cameron and his colleagues explain that there are three reasons these practices benefit the company. Positive practices:

• Increase positive emotions which broaden employees’ resources and abilities by improving people’s relationships with each other and amplifying their creativity and ability to think creatively.
• Buffer against negative events like stress, improving employees ability to bounce back from challenges and difficulties.
• Attract and bolster employees, making them more loyal and bringing out the best in them.

It's that interpersonal connection between people that get the job done. In a world where we still talk about "the man" causing us problems, we know we can trust and reach out to Joe down the hall who's always willing to lend a helping hand when a project gets tough. Strengthening and building those relationships is much easier when we stop, notice and appreciate the work of those around us in a meaningful way.

How would you describe your workplace today? Is it one in which people have truly deep, personal connections and r

As Globoforce’s Executive Vice President of Client Strategy and Consulting, Derek Irvine is an internationally minded management professional with over 20 years of experience helping global companies set a higher ambition for global strategic employee recognition, leading workshops, strategy meetings and industry sessions around the world. He is a leader in the WorkHumanmovement and the co-author of "The Power of Thanks" and his articles on fostering and managing a culture of appreciation through strategic recognition have been published in Businessweek, Workspan and HR Management. Derek splits his time between Dublin and Boston. Follow Derek on Twitter at @DerekIrvine.elationships with each other? Is it a truly human workplace? What would you like your workplace to be?

Insiders Vs. Outsiders

Have you heard this complaint?  “The Company would rather pay more to a green outsider than give one of us insiders a decent promotion”?

The complaint is that, when considering two individuals for the same job, someone on the inside oftentimes will receive a lower salary than if the company went outside to hire a stranger.  To compound the insult, it is not unusual for managers to ask insiders to train and orient the new ‘wunderkinde” as to how the company operates.

Aggrieved Employees

Aggrieved employees feel that an insider already knows the company, the people, the products/services as well as the policies/procedures.  That knowledge and experience is an advantage, they say, shortening any learning curve and cultural orientation.  Taking on the role and responsibilities of the new position and not being paid the “going rate” seems unfair – a penalty for being an insider.  It’s as if the company realizes they don’t have to pay as much for an existing employee, that the time spent in the company somehow reduces their market value and limits a willingness to pay a competitive wage.

Some insiders may feel that the technical experience they have gained in their current job could be used in the new position, so in effect they have already prepared for the new role.

However, prevailing practice seems to be that, when a company looks to the outside recruiters will be instructed to search for someone who already meets all the qualifications of the job; an experienced candidate who has already performed the job, whose only learning curve would be a short term acclimation to the new company’s policies and procedures.  Outsiders are free of “baggage”: no biases, preconceived notions or social network, and are thus considered more likely to become agents for change within the company.

You should also note: if someone already has performed the subject role the chances are good that they are already being paid about the competitive or going rate.  If that is the case, then the company would be forced to pay a premium to attract such a qualified person.  They would likely have to pay above the going rate (or above the midpoint in some companies).

Another office complaint is,“I’d be paid more money if I quit and the Company rehired me.”

Unfortunately, there is some truth to this gripe.  Over time the external marketability of good performers is rarely matched by annual performance awards within the company.

Merit increases averaging 3.0% may not keep pace with competitive wage growth, especially for in-demand skills.  Over time a company would find the prevailing wage greater than what they are already paying experienced people.  And if you must hire an experienced person you would likely have to pay more than the going rate, thus potentially creating internal equity issues.

You can do the math; if market pay increases at a faster rate than annual performance rewards, employee pay will fall behind.  At some point this will become a serious problem.

What Can You Do?

First, let’s look at promotions.  How can you best position yourself for the inevitable comparison with an outside candidate? 

You should compare yourself against the description or requirements of the new position and try to be as honest as you can with your internal assessment.  Can you perform this job from Day 1, or how much of a learning curve will you need?  Are there aspects of the new responsibilities that you haven’t experienced before?  The results of this assessment will give you an opening for your talk with HR.  They will push the “we’re giving you an opportunity” angle, and you both know they could always go outside for likely a better qualified candidate.  In fact, an advantage you have is that you are likely a cheaper choice for the Company.  So do not push the pay issue too hard, or you risk throwing the baby out with the bathwater.

When you’re doing your self-assessment, remember this checklist: 1) Are you already familiar with the company policies, procedures and personnel? 2) In your present role have you already demonstrated an ability with the technical side of the new position? 3) Remember that internal promotions look and sound good to other employees, and managers know this; 4) Can you develop an inside track with the manager (the all-important “fit); and finally 5) Reality is that you are likely a cheaper option than hiring from the outside.  Use that fact to your advantage.

The cumulative impact of annual salary increases is a harder issue to resolve, in that all employees are likely being reviewed at the same time.  Special treatment for you might create equity or precedent challenges for managers – both of which HR would have warned them against.  You want them to rock the boat, so you’d best come prepared with an argument for why your salary is not reflective of your worth to the company.

Don’t be afraid of compromise.  Your plan should be to gain visibility for your performance and value, though it may take some time for a positive result to work its way through the bureaucracy.  No matter what you gain from your initial conversation (short of complete victory!) suggest a follow-up salary review in three months.  Managers know they’d have a better chance of getting an adjustment approved after the general employee review, when it’s more likely an exception would be approved.  A manager who agrees to that review (and who will be thankful to avoid a contentious meeting) is already halfway to approving an adjustment down the road.

By being aware of the restrictions your managers are operating under you may be able to help them help you.  Don’t beat yourself against the wall of bureaucracy, but plan for your next step; use your internal knowledge to your eventual advantage.

Chuck Csizmar CCP is the 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 "Value Dice," by Stuart Miles

Cafe Classic: Be The Hero - You Can Do It

Editor's Note:  In a timely and Classic message for our times, Chuck Csizmar urges us to be leaders - heroes - by lifting up others, rather than promoting ourselves.  

Do you want to be admired and respected by your colleagues, recognized by senior leadership for who and what you are?  Do you want to be known throughout your universe as a go-to person, as a hero amidst the minions?

Then solve a problem.  Stand up and show someone how to get things done.  Clear the pathway; support someone’s idea, save a step somewhere.  Do what it takes to cross the finish line.  It's a target-rich environment out there, so pick something.

Just do it

It's not hard, really.  It's a matter of thinking not so much of yourself first and foremost, but of a greater value that is broader than yourself - and of focusing your attention on getting the results that help the department, the team, the business.   It's called a giving of yourself.  Of extending yourself.  But at the same time you can benefit in return.

All too often what we see from many employees at all levels of the organization is an effort to be the star, the success story, even at the expense of someone else.  "Look at me," these eager A-types seem to shout, "look at what I have achieved."  These are folks who seem to have missed reading the memo on team effort.  These are the "selfies" of the workplace.

We all have them in our organizations.  They surround us.  And don't we resent them?

Here's a thought, though.  Isn't it better to be lifted up (reward, recognition, the pointed finger, etc.) by someone else, then to be constantly trying to push yourself up there?  Doesn’t that ego rush get a bit tiring, what with the constant pressure of looking over your shoulder to gauge the competition?  Do you suffer from periodic stress headaches, where the muscles at the back of your neck tighten to stone?  Are you sleeping well?

Now picture yourself receiving that award, with the accompanying recognition, spotlight, accolades etc.  Nice feeling, isn’t it?  A proud moment.

Not all recognition is the same

I think it does make a difference in how one gets recognized.  I suppose that there are levels of self-satisfaction, but the highest must be when you're lifted on someone else's shoulder.   When you hear the cheer of the audience.  Self advertisement, political deal-making and a passive resistance that attempts to hold others back simply cannot provide the same level of genuine personal satisfaction.  Because deep down you'll know that you cheated to get there.

And others will know it too.

Think about someone whom you really admire, in whatever field of endeavor you like.   Chances are it’s a person who has accomplished something, delivered the desired results, made something of themselves.   They stood up for what they believed in.  They meant something.  Likely that person you admire so much isn't someone who took shortcuts, pushed others aside, ignored the call for help or otherwise kept their focus solely on the mirror.

Success can be fleeting, especially if built on thin ice.  So why would you want to taint yourself, like success with an asterisk? 

Of course you wouldn't.  But now reflect a bit on how you practice at your relationships at work.  Do you admire only yourself, and act accordingly,  or can you spruce up your act and become more of a team player?  Can you start using the word "we" more than "I"?

Naive?  Perhaps I am.  But I think we need more heroes out there, more decision-makers, more team players and more people willing to make a stand for what they believe in.

But that’s just me.

Chuck Csizmar CCP is the 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.

Cafe Classic: Influencer Networks - A Hidden Key to Recognition Program Success

Editor's Note:  We sometimes get fuzzy the difference between recognition and compensation as implements in our rewards toolbox.  To the rescue comes Derek Irvine with a Classic lesson on the unique aspects and opportunities - particularly the social opportunities - that recognition plans offer. 

I know readers of Compensation Cafe know this, but let me state the obvious – compensation and recognition are very different. A raise, for example, does not count as “recognition.” But one major difference between the two not often discussed is the public nature of recognition activities vs. compensation changes.

Sure the drumbeat for pay transparency has been increasing, but the likelihood of public, constant discussion along the lines of, “Hey! I just got a 5% raise for my performance last year!” seems pretty remote. Should that day somehow arrive, however, I still don’t see such publicity advancing the flow of positivity and a powerful culture of praise.

And that’s the beauty of social recognition – the truly social aspect. That’s the key element that drives culture change, increased employee engagement, and improved productivity. It’s the people involved every day, looking around for greatness around them, and appreciating and praising their colleagues for it.

Because of its public nature within the company, some assume it’s far easier to communicate change around social recognition. This isn’t true. As with any change, key messages need to be defined and ideal mechanisms identified to convey those messages. One such mechanism that is often ignored is the powerful communication network existing among your people already – your influencers.

Shel Holtz tells this story in Ragan.com:

"I first read about internal influence networks in a Harvard Business Review article sometime in the late '80s or early '90s; in any case, I haven't been able to find it. I was able to apply it for the first time during an engagement while working in the communications practice at a human resources consulting firm. We were about to communicate some very controversial changes that could throw the organization into chaos. We mapped the influencers in the company and brought them into a series of meetings where we shared the situation and our planned communications. They offered their critiques. We incorporated nearly every suggestion they made, even if we didn't necessarily like them; it made them owners of the message.

"We didn't tell them they had been chosen for these meetings because they're influencers. Most of them didn't even know the other people in the room. As far as they knew, they were randomly selected for focus groups and agreed to keep the information we gave them confidential. When the news finally did break, though, as we had thought, employees sought out their local influencer for a read on the situation. And, also as expected, they supported the change and even helped explain it. In the end, the change produced little tension. There was no need to get the word out in this case; it spread like wildfire."

Your influencer network is powerful, and it exists today. The big question is, what message are they helping to influence? Is it the one you want? In Shel’s illustration above, there are three key steps to identifying and utilizing your influencers to best effect:

1. Identify – Who are your influencers? It may seem daunting to identify them, but many can be discovered just by keeping your eyes open. Who’s the “Office Mom?” In the cafeteria or breakroom, who always seems to be center of the lunch crowd? Who’s the person with a reputation for spreading gossip far and wide?
2. Involve – If you want your influencers to proudly carry the message you want, you must give them ownership over that message. That means involving them in the decision-making around the messages to communicate, including when and how.
3. Unleash – When it’s time to introduce change, turn your influencers lose. Let them carry much of the message for you. Trust them with the change.

When introducing social recognition into your organization, these influencers are critical to most important message to convey – permission. In many organizations, peer recognition is often a very new concept. Giving employees explicit permission to notice, appreciate and reward their colleagues is necessary for viral adoption of social recognition. Your influencer network – your Appreciation Ambassadors, if you will – carry that message of permission better than leadership ever could.

Who are the influencers in your organization? How are they used today?

As Globoforce’s Executive Vice President of Client Strategy and Consulting, Derek Irvine is an internationally minded management professional with over 20 years of experience helping global companies set a higher ambition for global strategic employee recognition, leading workshops, strategy meetings and industry sessions around the world. He is a leader in the WorkHumanmovement and the co-author of "The Power of Thanks" and his articles on fostering and managing a culture of appreciation through strategic recognition have been published in Businessweek, Workspan and HR Management. Derek splits his time between Dublin and Boston. Follow Derek on Twitter at @DerekIrvine.

Cafe Classic: Rewards and the Uncredentialed, Disruptive Misfit

Editor's Note:  In times like these, reinvention and creative adaptation are necessary for survival.  Where will it come from in your organization and how well does your reward program encourage it - especially when that change comes from unlikely places and is driven by unexpected people?

Organizations that are unable to innovate and evolve will likely not survive, let alone prosper.  Few inside and outside our profession would argue the point.  What role can rewards play?

I recently had opportunity to attend a great presentation on strategic thinking -- and came away with interesting ideas and an intriguing book on creative invention:  The Medici Effect by Frans Johansson.  The book presents the case that new discoveries -- those that have real impact - will no longer come from within disciplines and established fields of expertise, but will instead spring from situations where ideas from multiple fields and points of view come together.  That is the Medici effect, named for the Medicis, a wealthy banking family in fifteenth century Florence.  The Medicis used their wealth to bring together and fund the work of creators from a wide range of disciplines -- from sculptors to scientists, from financiers to architects.  This diverse group of people who converged, beckoned by the Medici family, on Florence ignited one of the most creative eras in history, known today as the Renaissance.

We've discussed before how deep, specialized education in a field can potentially limit an individual's ability to think creatively.  Innovators are often self-taught (think Steve Jobs, Thomas Edison) or have pursued a broad learning experience that crossed many fields.

Johansson shares the story of Charles Darwin and John Gould as one example.  Darwin was a below average student who (to his father's chagrin) wandered around the English countryside pursuing various botanical interests and meeting with a range of scientists.  He enrolled to become a physician, then a minister, then finally decided to board a boat for a five year trip around the world to study geology on his own.  Along the way, he collected and wrote notes about birds from the Galapagos Islands.  Because they were of little interest to him, he gave the collection to John Gould, one of the most prominent zoologists of the time.  Gould, an accomplished taxonomist, assessed the collection and reported his rather interesting findings back to Darwin: that the birds were a single group of finches yet also reflected 13 distinct species -- one for each of the 13 islands.  Gould, the expert, stopped there.  Darwin went on to use this information to propose a radical notion that became a new theory of evolution, considered to be one of the most significant scientific theories of our time.

In a more recent example, successful venture capitalist Paul Maeder discusses the important role that disciplinary outsiders, often people without formal training, play in generating innovations. For him, identifying these individuals can help pinpoint the entrepreneurial teams worth betting on.  Johansson recalls a conversation with Maeder:

"Take this guy Stan Lapidus," he told me one day.  "He doesn't have an M.D. or a Ph.D., but he has come up with an amazing way of analyzing stool samples for colon cancer pathology.  Put it in a blender, mix, and you can spot cancer with hardly any false positives.  It's really an amazing invention.  Now, why did he think of this?  Because he's not a doc."

Back to us and the organizations we serve.  Too many have cultures and embedded practices that inadvertently (or maybe not) discourage, punish, even expell the uncredentialed, disruptive misfit.  Because everything we do in compensation is communication and organizations often become what they reward, I believe we have a role to play -- if we can get out of our own disciplinary silos.  A number of questions come to mind, including:

• Could linking rewards and promotional opportunities too directly to formal education and credentials create a barrier to those who may have followed a different learning path but could bring a valuable perspective to the table?
• Are our performance management/career development/succession planning processes designed to recognize those with expertise gained in non-traditional ways as well as those who may be counter-cultural and disruptive in a way that's ultimately beneficial?
• Can we do a better job of using non-cash rewards like high visibility assignments, the chance to work on key projects, and the opportunity to participate in exciting product/service development efforts to recognize the potentially valuable "misfits" and encourage a healthy convergence of different ideas and viewpoints.

Your thoughts?

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.

Image "Leader Holding Multiple Color Umbrella" courtesy of hin255/FreeDigitalPhotos.net

4 Tips for 2020 Career Development

What happens when you disappear raises, slim down bonuses, freeze salaries and/or jack up benefit costs? Career development no longer has to share the total rewards spotlight, and it becomes the go-to form of employee recognition.

Looks like we're in for that kind of year. And while employees are going to sorely miss the dollars, they'll be thrilled that you'll finally be giving attention to their career. Most employee surveys have reported this yearning for years.

You may think that addressing career development is no big deal. After all, the goal is to imagine the future -- no commitments involved. The thing is, experience shows that when this kind of year comes along, there is a potential for lots of miscalculations that can trip you up and that disappoint employees now and in the future.

Why not skip them and head right for a career development experience that gives value? It can be one of the most powerful employee recognition efforts you can undertake. These are field-tested tips that you can slip into your planning right away.

1. Don't trade titles for raises. Titles mean recognition to employees, and also status, social recognition and much, much more. Many managers yearn to gussy up titles as a way of making employees feel better in a down market. This is a guaranteed way to disappoint employees over the long term (and get your pay practices out of wack). The disappointment begins because the employee's job abilities haven't moved up a career level, so the title--in fact--has limited validity and social recognition. More disappointment rolls in when you have to tell employees that the title doesn't align with a promotion, even when pay practices go back to normal. Plus you've put yourself into a situation that will be difficult to explain to anyone's satisfaction unless your employees are well-briefed on your company's compensation philosophy and administration.
2. Speak clearly. Career development has a language of its own. Managers and employees need to be able to talk about job levels; compare skill development with competency development; identify experience in one job that can be successfully transferred to another; and so on. It's critical that everyone is "singing from the same hymnal" or there will be serious misunderstandings about what's being promised. Clarity and consistency are what you need to shoot for, so Human Resource-developed talking points and discussion outlines, plus guided employee involvement worksheets are needed this year.
3. Make an effort. I bet you're going to tell me that your company doesn't have career paths yet. Well, there's still time if you start with the basics. Use your most critical job category. Map out the steps it takes to move up through the career of someone in that job category. There are at least three steps: Entry, developing and expert. In many companies there are a few more steps, but never more than seven. Odds are the career path for a manager is different than the professional or administrative career paths. Once you have your first career path mapped out, make sure your job titles align well with the career steps. Then use your first career path model to develop paths for the other job categories, being sure to align your job titles with the steps in each career path. When you have created a career path for each job category in your organization, assess whether the job titles align consistently across career paths, too.
4. Don't blue sky it. As you know, managers have a bad habit of over-promising. (Who doesn't want to be a hero?) So when they talk about upcoming stretch assignments or job openings, they need to have them pinned down. It's hard to exaggerate how much career opportunities mean to most employees. Experience shows that when a manager reneges on a employee's career plan, the trust level between the two is almost impossible to fix.

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.

Compensation Air Traffic Control

In the past three months, must of our businesses have experienced an upheaval of historic proportions. During that period, you may have been challenged with an array of uncomfortable tasks. You may have been involved in laying friends off, furloughing colleagues, cutting pay for executives, putting holds on merit increases, temporarily modifying incentive plans, marketing pricing for newly remote positions, all while working from a dining room table, teaching math, and cooking more food than an average holiday season. And now, just as summer is raising its beautiful head, many of us are planning to return our staff to some version of our past practices. The swirl of tasks and requests can make a compensation professional feel more like they work in air traffic control.

Each action taken in the past three months is like an airplane that was sent into the sky. Fuel is now running low and the planes need to land. You are probably sitting at your desk (or sofa) trying to determine which thing s needs to be brought home first. You only have a few runways, and each task requires new processes, rules, and ongoing communications. You may need to choose between finding the best solution to fix executive pay and finding a smooth transition to paying people who are returning to work. There is no rule book.

Every task may not be able to get the same attention and careful corrections. Some may need to simply be allowed to land on their own, while others may need you to put foam on the runway to soften their landing. Every person at the other end of these transitions is likely to feel that their personal situation is a priority. They aren’t wrong. Some may feel like they are the most important. And in today’s world several of them may also be correct. Similar to when we sat down a few months ago and figured out a new definition for “essential employee”, we must now determine who to handle first when there are several equally important tasks.

The key to success is to schedule things to come in for a landing in a sequence. No matter how much someone insists, two planes cannot land on the same runway at the same time. Hold your ground if you see this happening. The things that are running out of fuel must be landed first. This may be adjusting pay for a job family that has become more critical during this period. It may mean waiting to communicate an important executive plan until your broad-based program has been brought back to speed. The important thing to remember is that you may be the only person at your company who has the expertise to make these decisions.

Air traffic control is not for the faint of heart. People’s lives are literally in your hands. Compensation can often seem pedestrian, but in times like this, your job may be similar. You may be the difference between your company or your staff successfully navigating this transition … or not.  It’s time to bring them in for a landing. Who else knows how to do that but you?

I have been collecting information on, and working with many, companies who are making this transition. The issues are similar, but below the surface, the solutions are often unique. Use the comment section to share your thoughts or questions. I am sure there are other professionals who are willing to provide helpful advice.

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He is a “Compensation Futurist” who works as Managing Consultant for FutureSense. Dan is also a leading expert on incentive plans and equity compensation issues. He has written several industry resources including the only resource dedicated to 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.