Here's a question for you.
In a recent Board level conversation, I found myself part of a debate about the need for clarity in executive rewards. On the one hand, I had a chief executive expressing a preference for a more structured and clearly communicated compensation package. On the other hand, I had a Board Chair articulating the belief that it is an executive's role to manage ambiguity and that the compensation package ought to reflect this fact. The details underlying the debate aren't important here - but I think the question at its core is an intriguing one.
I've run into plenty of hazy compensation plans before (I'll bet many of you have, too), but typically the haze is there courtesy of an unclear strategy, lack of commitment to or certainty around measurement, or just an unwillingness to tackle the full task of plan definition and communication. Not this time. This was the first time I encountered plan ambiguity coming from a place of strongly held principle.
I get that we live in an increasingly uncertain world and that dealing with uncertainty effectively is part of the job for most of us. And a key challenge and expectation for those in an executive role.
But I also believe (and I think that this is a deeply held principle for me) in making compensation plans - for any employee and particularly for executives - as clear and unambiguous as circumstances permit. Where is the value in leaving them guessing - unnecessarily - as to our meaning or intent?
What about you - got a strong opinion one way or the other? Does ambiguity have an important and purposeful place in compensation plans? For executives? For anybody?