Editor's Note: This week's Thought Leader is Dow Scott, Ph.D., Professor of Human Resources in the Graduate School of Business and the Institute of Human Resources and Employment Relations at Loyola University Chicago. Dr. Scott specializes in compensation, incentive pay and high performance organizations and has authored over 100 publications, including his recent book Incentive Pay: Creating a Competitive Advantage. Through his research, writing and speaking, Dr. Scott is helping push forward the boundaries of our understanding of employee rewards and performance.
Compensation Force: What led you to choose (or land in) a career featuring the field of rewards?
Dow Scott: Upon completing my Masters Degree in Human Resources in School of Labor Relations and Industrial Relations at Michigan State University, I took a job in human resources at B.F. Goodrich Company. Although I started in human resources development I soon transferred to a plant where I created a compensation system for hourly employees, then I worked with the pay data for the negotiation with a major union and finally I transferred to B.F. Goodrich’s international division where I work with global compensation. By then I was hooked on compensation. When I returned to Michigan State for my Ph.D., I focused on compensation and incentive pay programs. I have taught, consulted and conducted research in the compensation field for more than 30 years. “Time flies when you are having fun.”
Compensation Force: What person and their ideas/teaching/writing have had a significant influence on your thinking and your work?
Dow Scott: Three professors have had a major impact. The first was Tom Patten who wrote an early textbook on pay and was my faculty mentor at Michigan State. He taught me the fundamentals and involved me in one of the first comparable worth cases at GE. The second was Carl Frost who was also on the faculty at Michigan State. He involved me in the development and implementation of Scanlon Plans (i.e., gainsharing). Dr. Frost demonstrated how incentive plans and employee involvement could transform organizations. Finally, Ed Lawler always provided provocative views on compensation which has challenged my thinking throughout my career.
Compensation Force: Is there a book you’d recommend to others in the reward field that has impacted your thinking and your work?
Dow Scott: Although the book is over 10 years old, Carl Frost’s book Changing Forever speaks poignantly about the underlying role that compensation can play in transforming the culture and competitiveness of an organization.
Compensation Force: Looking to the future, what trend or development do you think will significantly impact the reward profession and those of us working in it?
Dow Scott: Global organizations are forcing reward professionals to understand how complex cultural beliefs, diverse legislation and pay traditions influence the design and implementation of reward strategies, policies, and programs. The challenge of creating reward systems that encourage top talent to advance to more demanding position and move across the world are daunting. Furthermore, we need to think carefully about the role of variable compensation in pay packages at all levels in the organization. How much variability in pay can employees tolerate? What kinds of behavior is it really driving?
Compensation Force: What are you currently working on?
Dow Scott: I am working on two global reward projects. The first examines how perceptions of pay fairness differ across countries, cultures, industries, occupations, genders, races and age groups. My research team and I are trying to understand how these different perceptions can and should influence the design and implementation of reward strategies, policies and programs.
The second research project is a global study of how pay differentiation in base pay and pay variability (incentive pay) influences employee attitudes and organization performance throughout the world.
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Our special thanks to Dr. Scott for participating in the Compensation Force Thought Leader series and taking the time to share some of his history, thoughts and ideas with us today!
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