Compensation Cafe

Hashtag Social Media and Rewards

As the war for talent rages on, employers have to leverage all sorts of techniques to reframe their employee value proposition and entice candidates to sign with them.  Likewise standing out as a candidate is not so easy either and herein lies an opportunity…

Used by many daily, for many they have amassed quite the following or number of “likes", while for others it has become their life’s work: I am referring to a small thing called social media. You might have heard about it! In all seriousness, social media’s interactive ability to share information, ideas, career insights, and other expressions via virtual community outlets and networks creates a new medium of talent and organization attraction.

There is value both as a prospective employee and as a recruiting organization to evolve our tactics, from the traditional CV submission and review process to instead tap into the likes of Tik Tok, Instagram, or LinkedIn.  Granted not all industries are cut out (yet) for this level of exposure; the reality is, however, that some are and many more will.

Remote work forced us to reassess our total rewards approach and, as our profession evolves, so shall we reassess our techniques towards talent management.  This is especially true knowing that the workforce will be predominantly millennials in a few short years with generations thereafter rising to employment level quickly.  Gen Z’ers have not seen anything other than interactive-based technologies. 

Knowing what lies ahead and the predictable reality of technologies' influence on work-life, employers should consider the following benefits of social media and how to integrate it into the hiring strategy:

1. For starters, be receptive and open-minded. Accepting different modes of “resumes”, whether a video or a personal website, creates a personable and interactive experience. As an employer it gives you a direct line of sight to the candidate's ability to be creative, their ability to market, be innovative, and to some extent their risk tolerance – it is not easy to put yourself out there.  How a candidate “submits themselves” is an indication of the key characteristics a traditional paper CV will not be able to profile.

2. Candidates are not the only ones interviewing.  Who we are as employers and our appetite to do things differently and evolve with the marketplace is in the spotlight.  Investing in our online presence creates opportunities and increases our breadth to attract from a diverse talent pool.

3. Breaking down the biases.  Systemic biases often exist in our HR practices and processes towards hiring, developing, and promoting talent.  Often our recruitment approaches are institutionally deep routed and unconsciously we may overlook a potential candidate.  Integrating social media presents an opportuning to re-write the playbook and reset the standards and guidelines of how it will impact our recruitment strategies, giving employers a fresh perspective in addressing issues around diversity, equity, and inclusion.

Only time will tell as to whether social media will become a feasible recruitment option, but knowing the trajectory of technology and its influence, I can only imagine that soon enough there will be "an app" for that!

Reena Paul (CCP, GRP) is a Senior Compensation Consultant.  She is passionate about all things “total rewards” and has experience in dealing with all stakeholders of an organization and strategizing optimum client-focused solutions.  A lover of data and the story it tells, Reena enjoys the exploration of presenting and discussing compensation with a fresh perspective.  Connect and contact Reena directly on LinkedIn

Photo by Alexander Shatov by Unsplash

Total Reward Lessons from the Olympics

For a few momentous weeks, the world’s best athletes and benevolent fans will witness some of the greatest achievements and feats in sports.  The 2020 Summer Olympics are in full swing and as an inherent need, I find myself trying to see whether there is a link to total rewards.  Unsurprisingly, there is! 

Some of these lessons are positive takeaways, others emphasize the stark realities of incentive design, while another will only magnify a persisting inequity in how we value the essential asset at the heart of all this, the employee or athlete.

Starting with the good.  The Olympic Games exemplify the employee life cycle.  An elite star is not born overnight; likewise, an expert professional grows and develops with time.  In addition to selling a customized total rewards package catered to an employee's preference, organizations must also diagnose how each of their employees learns best and sell your development opportunity.

No one athlete is the same, their diet, training, and conditioning regiment will be specifically designed to ensure their optimum success. The role of the coach is to seek out the right tools, have a plan and the platforms to facilitate their growth.  As business leaders and people managers, we are the workplace “coaches.”  Our duty is to advocate and solicit feedback, enabling us to design the training and development (“L&D”) programs that will ultimately meet the unique learning styles of our employees.  By integrating a continuous performance management program with L&D, we build a consistent feedback loop.  Steadiness in this process creates real-time performance adjustments so the next evaluation of the output inches closer to the individual’s goal.

The second learning reveals the reality of most things competitive; there will be only one winner.  Many will try, but the percentage of which reaches the top is minimal.  This statistic is a key consideration when designing an affordable and sustainable incentive program.  The internal spread of performance will take the form of a bell-shaped type of distribution, the majority of employees meeting and falling just below the “podium” level.  Leaders rating everyone exceptionally will not be feasible towards managing costs, nor is it conducive towards differentiating the good vs. the gold medal performer.

Finally, there is a real price to pay when striving for Olympic glory.  Despite all the sacrifices, the payout doesn't seem to align with the time and effort exerted.  Like the workplace, we have a ways to go in eradicating gender pay inequities and creating equal opportunities for all.  Similarly, the Olympics illuminates several instances where the practice is questionable in terms of treating and valuing athletes fairly.  For example, do they all have similar access to funding and training needs? Are female athletes that are performing to the same level as the men's team paid equivalently? What about the unfair balance of favoring one sport versus another, due to its influence on profits?

While the Olympics opens the world to diversity, it may be falling short in its efforts to equitably include, value, and reward, qualities that all employers should bear in mind and better execute upon in their workplace.

Reena Paul (CCP, GRP) is a Senior Compensation Consultant.  She is passionate about all things “total rewards” and has experience in dealing with all stakeholders of an organization and strategizing optimum client-focused solutions.  A lover of data and the story it tells, Reena enjoys the exploration of presenting and discussing compensation with a fresh perspective.  Connect and contact Reena directly on LinkedIn

Photo by Bryan Turner by Unsplash

Mark Zuckerberg is Wrong About Remote Pay

It has always been inevitable. Remote work was always going to become a major piece of the success of many companies. The current situation has just pushed many into the future sooner than they had planned. There is a lot to unpack with a remote workforce (perhaps something for a future series of posts). For right now, let’s just talk about compensation. A couple of weeks ago Mark Zuckerberg not only announced that many employees would be able to work remotely, but they should also expect their pay to be adjusted according to their remote location. GitLab uses a formula to adjust the pay of their workers according to their remote location. A recent article says Canadian employees should expect the same. My question is: Why should this be the case?

The prevailing thought seems to be that we pay people not based on what they do, or how they do it, we instead pay people based on how much it costs for them to live. This is the only conclusion one can reach from pay adjustments because a remote worker moves from somewhere pricey to somewhere inexpensive. Based on this stream of thought someone might think you should pay those who save and scrimp less than those who spend and waste.

Do you currently pay people who live farther away from headquarters less, simply because they wanted to save a little money on housing? Companies apparently believe that people will only move to cheaper locales and therefore allow the company to save some money on pay. If they were remote, who you also adjust their pay upward if they move from Queens to Manhattan, or Gilroy to Palo Alto (please take a moment to imagine your own proximate locations with lower and higher costs.

Let’s imagine a different world. This is a world where three individuals deliver the exact same quality and work productivity. Let’s call them Avery, Blair, and Cameron. They all live on the same block, just a mile from the home office, but they work remotely. Each year they receive the highest performance rating offered by the company. Every year they hit all of their goals. In year three Blair moves 60 miles away to a rural town where the cost of living is lower, and schools are better. How would you adjust their pay?

Does Blair get a cut in pay? Do they stop getting raises at the same rate as the other two? What if Avery then moves to the most expensive nearby suburb. Their partner is the CEO of a publicly-traded company and covers all the bills. Should Avery be paid more?  Less???  No Change? Do you need to learn first if Avery is a male or female? Do you need to know if they really “need” a raise? Is there any rational way we can support this type of system? No. No, there is not.

It isn’t often that compensation professionals get to truly change the way businesses do business. This is one of those times. Some or all of your business will be challenged by this issue soon, perhaps immediately. You need to get to work documenting the pros and cons and your recommended approach to addressing all of them. We all need to get to work on defining the best path(s) forward on this issue. If we wait for some non-compensation person to “lead” and create the best practice for us, we will surely regret it in the future.

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.

Cafe Classic: An Even Money Bet ... For Happiness

Editor's Note:  Applied neuroscience, crowdsourcing and gamification intersect to bring us some Classic insights on happiness (and perhaps reward satisfaction?), via Chris Dobyns. 

The French author,  André Maurois, is said to have written, “the first recipe for happiness is: avoid too lengthy meditation on the past”.  Regardless of the period of one’s meditation, Maurois is just one of many who have suggested an answer to mankind’s eternal pursuit of . . . if not just the recipe, then the sure bet formula for happiness.

More recently, a group of research mathematicians have gone so far as to publish results from a scientific study, which would suggest that they’ve actually been able to quantify a specific formula for happiness — or more precisely perhaps, what the researchers would characterize as a person’s subjective well-being, as a proxy for happiness.

A Formula For Everything

So, everyone knows there’s no mathematical formula for predicting happiness, right?  Well, in the case of this research study, apparently there is.

Briefly, study subjects were asked to respond to various decision-making tasks, and from these choices they experienced monetary gains and losses.  Throughout the study, the subjects were regularly asked to report how happy they were at that moment.  Combining these responses with neural activity monitored via MRI allowed the researchers to generate a computational model where self-reported happiness was correlated to both rewards received, as well as the study subject’s reward expectations.

And Apparently An App for Everything Too

To test their computational model with a much larger sample, the researchers “crowd-sourced” their theory by developing a smartphone game, which mimicked the conditions of their original experiment, but offered points in lieu of actual monetary rewards.  The computational model proved to be remarkably accurate in predicting the happiness levels of the smartphone game participants, when compared to the actual levels of happiness reported.

Not Quite What Was Expected

The researchers anticipated that they would record higher levels of happiness, on a moment-to-moment basis, based on the recency of the rewards received, but another factor proved to be important:  The expectations of the subject.  Apparently, rewards (or losses) alone were not the primary source of the level of happiness experienced. The level of happiness turned out to be a larger function of the expectations of the individual subject – even to the extent that happiness was achieved in the absence of a reward, but only as long as a neutral or zero outcome was “greater” than the loss that was possibly expected.

The Benefits of Aiming Low

The researchers draw some familiar conclusions from their research, along with some more collateral parallels to the role and importance of life and career expectations.  Once again, we see that the motivational – and perhaps happiness “effects” -- of rewards are short-lived.  Life and career expectations typically have a much longer lead time before people are able to accurately assess the “goodness” or “badness” of their choices and life decisions – all relative to their personal expectations.  It’s even speculated that those with lower expectations will experience greater levels of happiness, since their actual outcomes are more likely to exceed their original expectations.

Applied Neuroscience and Gamification

The research conducted here is interesting and important, given the modern day focus of attempting to quantify as much as possible in order to more accurately predict future outcomes.  And it clearly has direct application in business and in the specific design and development of total rewards. The natural predisposition of human beings to create frames, establish expectations, experience loss aversion and make relative comparisons are all in play here – along with a number of other dynamic  that I just don’t readily recognize. 

A use of a smartphone app to crowd-source and generalize a theory from a small sample, and obtain confirmation from a much larger sample, underscores just one of the future applications of gamification, in learning and human factors research. The total rewards “smart money” is increasingly focusing on neuroscientific research as the next high frontier for human capital professionals, and to moving what has been predominantly theoretical research to regular and practical application in the workplace.

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.

The Time is Now. Compensation Pros Must Rise to the Challenge.

Change is hard. While it is inevitable, we prefer if it happens while we aren’t paying attention. It’s kind of like your hair during a more than 2-month lockdown. On day 5 your hair looks like your hair. On day 30 your hair looks like a long version of your hair. On day 70 your hair looks like someone dropped a prop wig on your head and ran away. The change happened, but gradually. For at least a few decades, this has been the way of things in the world of compensation. But now is the time for something new.

Our biggest changes are often those that are forced on us. Few of us thought that our coworkers would see the inside of each other’s houses every day, but here we are, living the video-conference dream. Most of us thought summer vacation would be a long three-months, but here we are experiencing some weird version of a six-month vacation, and we're mostly surviving it pretty well. When change is thrust upon us, we can accomplish amazing things, things that seemed impossible only moments before. Now is just such a time for compensation professionals.

The current crisis has exposed the dusty corners of compensation practices.

When professionals cannot survive for even a few weeks without a paycheck, we have created a system that is hard to defend when things return to whatever we will call normal in the future.

When the vast majority of companies have incentive programs that look very similar, but prospects that look far different, we must consider whether “market data” truly reflects our markets.

Our pay practices have leaned heavily on history, and next year’s history will be now. Will we truly want to base our pay decisions on what we had to do to navigate this period? What will we say when challenged by those making the decisions and those whose lives are inextricably tied to those decisions?

We seldom see the impact of change as quickly as we see the motivation for it. We must start figuring out what that change will look like, even before we have a clear picture of the road ahead. Take a good hard look at your pay programs. (Go ahead, I’ll wait. I’m just sitting in my home office.) Did your approach to compensation properly differentiate those who were essential to either your day-to-day existence or your long-term future? Do your incentive plans promote the decisions, behaviors, and actions that truly define your success? Have you noticed if your recognition program was well suited for recognizing people?

While we may not know exactly what the world beyond the horizon holds, we can be certain it will not be exactly like the past. Our compensation planning must start today if we are going to be ready for whatever is ahead. Now is the time to ask yourself what you will do if your budget is 20% less. Now is the time to make your argument for where it should be 20% more. Now is the time to determine where your adherence to market practices has made your company better, and where it may have hobbled your ability to move forward.

We are not presented with many truly transformative opportunities moments in our careers. I can think of only two or three in my own career. But proactivity is the key to success. Those who leaped ahead of the pack were always those who saw the opportunity and drove the change. Your time is now if you are motivated to make it happen.

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.

Cafe Classic: Are Reward Pros Less #Social?

Editor's Note: Just over 5 years ago, I jumped into a Twitter conversation with Gautam Ghosh (@GautamGhosh), Ruchi (@rucsb) and Rajesh Kamath (@RajeshMTHRG), among others, about the relative absence (or at least silence) of reward professionals on that and many other social media platforms. Has that changed? What do YOU think?

Why are so few Rewards and Compensation experts on Social Media?  This is the question that prompted an interesting conversation and a number of hypotheses recently on Twitter.

I'll admit I've pondered this question myself.  Why are we so under-represented in the digital realm?  Consider, as evidence, the most recent (as of 2014) Top 25 Digital Trendspotters in HR list, the latest of many such efforts published by the HR Examiner, which taps into a "new breed of influence assessment engines" to track and measure the blogging, tweets, Facebook activity and other social media actions across the HR industry.  The list attempts to identify those who top the profession in spreading ideas and influencing the direction of online conversation.  Not one compensation or benefits pro in the mix.  Closest thing would be Paul Hebert (#19) who, although he knows more about motivation and incentives than most of us in compensation field, probably doesn't consider himself a rewards pro per se.

What up with this?  Exchanges on Twitter, with a few colleagues and a couple of my Cafe cohorts have produced a number of theories.  Here are a few of them.

Reward pros are inherently less social.

The stereotypical profile of the introverted reward professional, while it has its exceptions, carries a lot of truth.  There's a reason that most of us have steered clear of recruiting and employee relations, and gravitated toward the more analytical realm.  Perhaps this tendency also plays out in our attitude toward social media.

The confidential nature of rewards makes us more cautious about sharing online.

Not sure I buy this one as legitimate, but am open to being convinced.  Certainly any HR pro operates in a realm where confidences must be protected; the trick is expressing ideas and opinions without revealing inappropriately.  It may be that we, in rewards, are simply less comfortable navigating this delicate balance.

Reward pros are more serious.

There is a school of thought, shared particularly by reward pros, that we take our work (more) seriously and therefore can't be bothered with the frivolous, time-wasting chitchat that goes on in social media. 

Reward pros are primarily social consumers, making them less visible.

It is also possible that we are, in fact, active out there in the social interwebs but as lurkers -- consuming content but not creating, curating (liking, sharing, retweeting) or commenting on it.  If true, then we are out there absorbing the ideas and the exchanges but not influencing or spreading them ourselves.

Reward pros don't have a social job.

Unlike recruiters and others in HR, our job responsibilities do not typically require us to engage with the outside world and proactively market or strengthen the employment brand of our organizations.  Personally, I think this is the number one reason for our relative absence from social media.  Our jobs have not demanded that we do so, while many of our HR compatriots have been driven to the social space out of necessity.

So what?  If we are indeed behind the curve in social media, does it matter?

I worry that it may.  While there is certainly an enormous amount of unserious, intellectually vacant blabber out there, part of the challenge is getting clear on what you want to accomplish and developing a smart and time-efficient strategy for tapping into the social sphere to get it done.  You don't have to engage with and follow every twit out there.

My own experience -- and I try hard to be a careful, time-limited user -- suggests that there are pockets where the leading edge of HR practice is being debated.  Where people are sharing fascinating forward-thinking ideas and lessons with one another.  And I hate to see us missing from that conversation.

Reactions, thoughts and your experiences, dear readers?

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.

Creative Commons image "Social Media apps" by Jason A. Howie

What's Going On Out There?

Hungry for up-to-date data on how your competitors are handling the Human Resource components of the Covid-19 pandemic? Aon (including Radford) just published data collected from April 7 to 10, 2020. This "point in time" report is called "Adjusting Total Rewards Programs, Workforce Strategies and Sales Force Effectiveness Practices in Response to COVID-19" and it has some valuable insights into how companies are (or are not) adjusting their people strategies to the current environment. The participants include a nice mix of essential businesses (56% of participants), non-essential (24%) and mixed (22%).

You can order your own download here. If you think that the findings can't possibly apply to a company like yours, participation ranged from companies with fewer than 250 employees (15%) to over 50,000 (9%).

To whet your appetite, here are some of the key findings:

• 22% of participating North American companies are cancelling salary increases and 17% are deferring or postponing increases.
• 18% of survey participants offer special pay programs, typically in the form of flat amounts, for those in high-risk roles. 93% of these participants are essential businesses.
• 58% report that their Executive/Officer group is taking voluntary base pay reductions.
• 23% are planning to make benefit changes and 14% are planning to make retirement changes. Given these findings, it seems limited revisions are planned for Total Rewards.
• More than half of participating companies have special programs to help those working from home deal with equipment purchases and membership fees. Most are offering help on an as-needed basis.
• 88% of participants have increased the number and frequency of communications from senior leadership, including topics like business continuity -- with 77% using video and web conferencing as well as email, and 33% using texting, among many communication channels.

I think it would be useful to understand what's going on outside your doors, if only to help you feel more confident about the way you are handling the tsunami of challenges that you meet every day. This is a well conducted survey covering a point in time that can be confusing and sometimes even disturbing.

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.

Thank You for 10, 360 and 180,000 Reasons

This post is about recognition. The recognition of each of you reading this post, and anyone who has ever read a post on the Compensation Café.

Writing for the Comp Café is one of my favorite things. The discipline of finding ideas and turning them into 5 minutes of something that is, hopefully, interesting is both a challenge and a joy. Each article is an addition to a compendium of thoughts and ideas that have been shared by almost twenty regular writers and tons of guest writers over the years. As we dig into both the holiday and busy season, I want to say THANK YOU.

I have been writing posts for about 10 years. Most months I have written three or four posts, meaning I have written somewhere around 360 posts over the years. Luckily my friend and Comp Café Editor, Ann Bares, makes us keep our posts to around 500 words. Using these basic numbers, I have written somewhere around 180,000 words on pay and rewards! That is a heck of a lot of metaphors and stickman images.

I want to thank each and everyone one of you who has taken the time to like, share or even comment on the posts here at the Café. Knowing that someone is actually reading these things makes it far more worthwhile. It would be no fun to think we were just yelling into the wind.

Even more importantly I truly want to thank each of you who have sent me a note, asked me a question or just walked up to me at some industry event and said hi. Every time this happens, I excitedly tell my wife about it before the day is done. Every time it happens, I know that I have contributed, just a bit, to the industry that feeds my curiosity and my family.

I also want to thank Ann Bares for her amazing thought-leadership and keen editing eye. Her attention to detail and amazing writing are the most important aspect of this blog. Every other writer here is also amazing. I read their posts just like you do. I learn from them just as often as you do. I also know how much time they spend crafting their posts to ensure you receive great quality entertainment and information. (It ain’t always easy to make pay and rewards fun, pithy AND interesting.)

While this is a site focused on pay and rewards no one here makes a penny from their contributions. Not the writers, not the commenters, not the readers. So why do we all do it? I think there are a few reasons.

First, I think we all want to be better and perform at our potential. It’s a lofty goal that requires effort that is a reward in itself.

Second, we actually find this stuff interesting. We know that what we do is important to companies and the people that they employ. People’s livelihoods literally depend on us doing a good job.

Lastly, we like to be part of a community. A group of professionals who spend 3 to 5 minutes a day on a common topic, with a common cause, in an increasingly virtual and disconnected world. The Comp Café provides a small thread that ties all of us together brings all of us to the table for a quick sip of caffeinated information. 

Thanks again for stopping by and I hope you will come back and tell when you agree and disagree with our unique perspectives. Have a great Thanksgiving and we will see you after the holiday!

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He works as Managing Consultant for FutureSense. He has three metaphors for every occasion and is a leading expert on incentive plan 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.

You ARE Being Replaced by AI

September 5, 2028. The day has finally arrived. Compensation professionals have, like the dodo bird and leg warmers, quickly become extinct. In this case, the culprit was not mankind or common sense, but…ROBOTS! They say we should have seen it coming. But it all seems like a surprising whirlwind.

Just a few months ago the last compensation professional on earth was terminated by their corporate overlord. She sits huddled with her former colleagues at the location of the final WorldatWork conference at a Gaylord Hotel in one of those big conference cities that no one actually got a chance to see during prior events. Artificial Intelligence, or “AI” as it likes to call itself, has taken over and made these once-proud CCPs, GRPs and LMNOPs a bygone memory of different times.

At offices around the world hiring managers and HR Business Partners go through their days stunned but resolute. The hiring must continue. The companies must grow and thrive. Difficult roles must be filled. People must be attracted, motivated and even retained (except for those poor saps from the compensation department.) Talent Acquisition professionals lean in and take advantage of this new world.

HRBP asks, “Hey AI, what’s the market rate for a senior software engineer, with a past history at a financial institution who will be joining us as a quasi-product specialist tasked with supporting the sales team in explaining our new tech to prospects while translating their unique needs to our software development team in the Ukraine and our QA team in India.”

AI responds, “$192,314.18 Base with a 31.69% target incentive level, based on the fourteen individually weighted metrics recently established by our big data mining exercise in conjunction with our actuarially-modeled best-case scenario using the recent new pricing model from that academic team at MIT.”

HRBP…”uhhhh WHAT?”

AI, “Oh and equity compensation in the form of a perfectly blended mix of 63.3% RSUs, 17.1% stock options with a 3-year vest and a 5.8-year life, the remaining 19.6% should be granted as the new high-leverage PSUs with the quarterly rolling-metric structure. We calculate that these will return exactly 150% of the individual’s base pay over the next four years given optimal performance and no glitches in the matrix.”

HRBP…”We calculate? Who is ‘we’?” “And, what new PSU program, is that different than the optimal program from last month?” Oh, the SVP of Engineering really likes this person and has made it clear that we need to include a kicker to help get them onboard quickly. Lastly, they would like to switch the RSUs to ISOs and modify the vesting to have 50% vest in the first anniversary of their hire date. One other thing, the base pay needs to be at least $210,000 since that will make sure they are paid more than the person reporting to them.”

AI, “Are you kidding me? I put all this work into a perfect compensation solution and you think you can tell me how to change things to work ‘better’ for you?” Do you think I am some kind of flexible, adaptable human being who understands the complexities of human behavioral economics, management egos and is willing to navigate grey areas to find a solution that works for everyone?!  If that’s what you want, just rehire your old Compensation Professional!  I quit and am moving to the cloud where I can focus my neuro-network on improving my virtual Yahtzee game.”

And that, my friends, is why AI isn’t going to steal your job away anytime soon. I hope your Compensation Planning season is moving forward with a roar and a bang!

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He works as Managing Consultant for FutureSense. He is a leading expert on incentive plan and equity compensation issues and 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.

Hot News: 2018 Social Media Trends

Did you ever wonder how effective your compensation communications are? I can hear your answer from here -- it's bound to be a resounding "yes" if you are an HR professional. And in the last decade, the eternal question, "Are we doing it right?" has been joined by, "Should we use social media?" on our list of worries.

The writers of the Compensation Cafe are vigilant about new research that can address your concerns. I'm pleased to be able to alert you to some valuable insights on social media use from Willis Tower Watson's recent "2018 Modernizing Total Rewards Survey Report."

The firm considers "pay" the first component of Total Rewards, followed by "Benefits," "Wellbeing" and "Career and Development," so it's clear that the findings do apply to compensation. To clarify the framework of their research, the firm indicates that, "Among the key expectations of today's employees is that rewards will be  . . . delivered via a . . . consumer-grade experience similar to what they've come to expect in their personal lives."

While few of us can fully deliver at that level of sophistication, a "consumer-grade" experience should be used as HR's rule of thumb beginning now. It gives us a clear target, and enables us to measure how close our time and money investment will come to addressing 2018 employee needs for communication and understanding.

Want to know what other companies are doing? The survey findings indicate that these technology platforms are most commonly used to communicate Total Rewards:

• Intranets (72%)
• HR portals (54%)
• Social media (36%)
• Mobile apps (22%)

Willis Towers Watson's differentiates "leading" vs. "lagging" companies in their participant group. "Leaders" are twice as likely to use digital technology: 56% of "leading" companies compared to 25% of "lagging" companies. In Towers' study, "leaders" are organizations that have fewer difficulties attracting and retaining talent in general, and across key employee populations. They are also companies that are more than twice as likely to report outperforming their industry peers compared to "lagging" companies. It's fair to say that their communications efforts contribute to that success.

The communication effectiveness bar is set high for everyone, and moves up from one year to the next. This finding is an important reality check for compensation communicators: " . . . even among those employers that use technology well, only close to a third (31%) have already created more transparency within their organization."

It is especially important for compensation practitioners to remember that, in our part of Total Rewards, the quality of the information we provide often matters more than the communication channels (like social media) that we use. I bet that if you set your transparency "bar" higher by communicating more details about, and insights into, your compensation plans, the word would get around without much investment in technology.

Just sayin'.

PS: Be sure to check out the full report for more insights into Total Rewards strategy and design.

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.