Are We Stuck in a Benchmarking Rut?

Can we benchmark our way to reward success? 

I don't think so... but as a profession we may be stuck in a rut of trying to do just that.

This was one of a number of threads that I picked up in this week's WorldatWork Total Rewards conference in San Diego.  Check out my post today at the Compensation Cafe, Are We Stuck in Market Mimcry, to learn more!

Image courtesy of stuck-in-a-rut-coaching.com

There's No Crying in Compensation

How did I miss this?

 

From the San Diego Live page covering this week's WorldatWork Total Rewards conference.

Nicely done, Kenexa!  Only wish I'd thought of it myself!

Random Conference Moments - Total Rewards 2011

Day 1 and 2 of WorldatWork's 2011 Total Rewards conference are behind us.  What a blast it's been for a compensation geek - to be surrounded by ideas and debate about some of today's biggest reward issues, to share a building with some of the smartest people in the profession.  I have one notebook nearly filled already.

Lots of great blogging fodder, so expect to see it coming out - a thought at a time - over the coming days and weeks.  Right now, just had to share out a few of my favorite conference moments so far -

Dan Pink's hilarious characterization, in Monday's opening keynote, of the annual performance appraisal discussion.  It went something like "that annual kabuki theatre piece we call a performance review".   I am not a member of the "kill performance appraisals" contingent, but I laughed as loud as anyone.  People were still chuckling about that comment on Monday evening.

Jim Kochanski's (Sibson, "Pay For Performance: The Big Bang Theory" session with Myrna Hellerman) sage advice on encouraging management honesty and fairness in performance assessment and pay decisions through transparency and disclosure: "Never underestimate the power of public embarrassment."  Hear, hear!

Tom McMullen's and Mark Royal's (Hay Group, "Reward Fairness: Slippery Slope or Manageable Terrain?" session) story illustrating how deeply notions of fairness are embedded in our DNA.  They shared the results of 2004 research published by Nature Magazine in which "monkeys that had previously been perfectly happy with a slice of cucumber suddenly stopped accepting it when they saw their partners getting a grape."  Apparently one of the more strident of the apes even threw the cucumber slices back at the researcher in anger, in response to the realization of unfair treatment.  Been there, haven't most of us?

Tuesday's award breakfast, where my local affiliate, the Twin Cities Compensation Network was named Association of the Year.  Kate Lang, who I believe was a founder and the very first TCCN President, was there to accept the award.  As a member, as a volunteer and as a former Board member, I am so proud of our group!  Big kudos to Kate, to Dan Byrne, to Ken Hirte, to Saado Abboud - and all the other terrific leaders who played a role in creating and nurturing such a great organization. Saado, as current TCCN President, also received the award for Workspan Article of the Year.  Look out world, Minnesota is rocking the rewards profession!  Go TCCN!

Hope everyone at the conference enjoys their final day today - and safe journeys back home!

Pinked

Yesterday's WorldatWork Total Rewards Conference opened with a keynote speech by Dan Pink, author of Drive.

It was an inspired choice, given the controversy Pink has ignited within the rewards profession, and I give him props for sticking around and doing an hour long Q&A with members afterward.  His message and material weren't really new to those of us who've read and watched him - but he is an entertaining and dynamic speaker.

My reaction to him, as always, was mixed.  I love what he presented as his stated goal for yesterday's talk: Challenging orthodoxies and assumptions.  This is critical for any profession, but particularly one that messes around with human motivation and performance.  I also completely - completely - agree with his main message that any simplistic carrot and stick approach to motivating people is doomed to backfire - and ultimately fail - in most situations.  We are not Pavlov's dogs.  Introducing money - or any reward - to a task or activity does change the dynamics, very often not at all in the way we intend or anticipate.

But geez, don't most of us already know that?

Maybe not.  Maybe this is a new insight for many in our profession.  Maybe it provides us with the ammunition and courage we need to challenge the simplistic and wrong-minded reward orthodoxies operating in our organizations and in the minds of our leaders.  Heaven knows that even in bad times there is no shortage of leaders willing to throw money at morale and performance issues rather than face up to the more difficult challenge of changing their behavior, looking closely at work design and obstacles or - gasp - taking the steps necessary to earn the trust of their employees.

If Pink and his work and his message help us take a strong stand here, then I'm all in.

Just don't treat me - or my fellow professionals - like we're a bunch of Luddites.  When he walked through his studies and told us all that he too was shocked, shocked to learn that rewards had produced unintended and counterproductive consequences, that it struck him as "wrong, in a fundamental and moral sense", I felt patronized.

And the solutions he puts forth for how we should - instead of simplistic "if, then" reward schemes - structure our employee pay:

1. Pay people enough to take the issue of money off the table (because we all have virtually unlimited fixed base salary dollars to invest these days, right?)
2. Pay people fairly (and the universally accepted definition of fair pay is what, exactly...?)

Now who's being overly simplistic?

Clearly, I remain conflicted.  Bottom line, though, if Pink succeeds at nothing else than his goal of urging us to continue challenging our professional assumptions and orthodoxies, we are all ultimately the better for it.

Fellow conference attendees (and anyone else), I'd welcome your reactions!

Holding on to High Performers: Top Five Reward Actions

What steps are employers taking, reward-wise, to retain their top performers as the economy and job market revives? 

A recently released study, Reviving and Inspiring the Workforce: 2011 Compensation Trends, by Buck Consultants, reveals (among other findings) what actions the participating 105 U.S. organizations are taking to hold on to their top performers.

As the outtake of the "top five" actions shown below tells us, providing new career development opportunities is the most popular tactic being pursued - a solid step, it would seem to me, given the target population.  Running behind that are three cash compensation actions - market adjustments, larger increases and larger bonus opportunities. Rounding out the top five actions is using non-cash recognition to reinforce and show appreciation for what these employees are contributing.

 
 
So, how does this compare to your organization's strategy?  What steps are you taking to hold on to your top performers?

Recognizing Safety

Tying safety to rewards in any manner is a tricky undertaking.  Fraught with peril, as I like to say.  So I was interested to see some just released data on safety recognition practices, and thought I'd share a few tidbits here.

WorldatWork has just published their newest version of the Trends in Employee Recognition Report (premium members can find it in the survey results page of the web site), which covers the employee recognition practices of over 600 responding organizations.  I'm not going to take time here to highlight and comment on overall recognition trends; my colleague Derek Irvine did a superb job of this in his Compensation Cafe post last Thursday.  Instead, I'd like to hone in on the safety recognition data.

For starters, 22% of participating organizations report having a safety recognition plan in place currently.  Certainly this reflects a minority of respondents compared to more broadly embraced kinds of recognition programs such as "length of service" (90%) or "above and beyond performance" (79%), but consider the fact that more than a third of the participants hail from less safety-intense industries such as finance, insurance, consulting, professional services and the like.  What would be interesting to see - but is not currently detailed in the report - is how popular safety recognition programs are in industries like manufacturing and construction.

The pattern in prevalence of safety recognition programs across the 8 years in which WorldatWork has been conducting this research is interesting, as seen in the table below.  I wonder what we should make of the 33% drop in prevalence from 2005 to 2011?

 
 
Also interesting to note are the differences in safety recognition plan prevalence across different organization sizes; in a pattern somewhat aligned with overall recognition practices, we see that safety plans are almost 3 times more prevalent at bigger organizations (5,000 to 20,000 employees) than at smaller ones (<500 employees).

 

Most of these safety recognition programs have been in place for awhile:

• 3% for < 12 months
• 27% for 1 to 5 years
• 71% for over 5 years

The age of the average program begs the question: are these plans being reviewed and updated regularly to ensure relevancy and impact?  Hope so.

Average percent of employees recognized in the past 12 months through safety recognition: 29%.  Worth noting that this is the highest percent across all types of recognition programs.  The three runners up are "length of service", "peer to peer" and "programs to motivate specific behaviors" - all at 21%.

One of the reasons I find this data interesting and worth sharing is that I believe recognition is a reinforcement particularly well-suited to safety.  More often than not, safety problems are pervasive cultural problems.  Recognition, which celebrates and creates role models of those who exhibit the desired behaviors, can be particularly effective in this arena.  Cash efforts, like specific safety incentive plans or even attempts to incorporate safety into a broad-based employee incentive program, certainly command attention - but they carry an impressive set of risks and challenges along with them.

That's it.  Reactions?

Image courtesy of onlinesafetycourse.info

Going to the 2011 WorldatWork Total Rewards Conference?

I'll be attending WorldatWork's Total Rewards Conference and Exhibition in San Diego May 23 through 25.  If you are too, it would be great to connect.

I will try to get several blog posts up during my attendance.  If you can't attend - due to budget, schedule or other constraints, what do you want to hear about?  Let me know!

Web Start-Up Goes After the Wage Gap

Think you're underpaid?  There's an app for that.

The backdrop:  After selling their personal finance site Thrive to Lending Tree in 2009, founders Matt Wallaert and Avi Karnani founded a new consultancy called Churnless.  Then, in the first of what they deem their "passion projects", they decided to tackle the gender pay gap.  The result?  GetRaised, a site dedicated to helping people "get the right raise, the right way" by taking them through a process that helps them assess whether they are - in fact - underpaid, guides them through the development of a custom Raise Request letter addressed to their boss and provides tips on how best to deliver the request.

Average raise earned using their process (according to their site): $6,726.  Cost of the service: $20 (with the stipulation that if you don't get a raise in 6 months, you get your money back).

Now I'd like to go on record saying that I believe we've debunked the 77 cents statistic as evidence of widespread gender wage discrimination (since the researchers who brought us that data point also tell us that all but 9 cents of the difference can be explained by non-discriminatory factors).  The fact remains, however, that there are unexplained gender differences in pay - some part of which may well be linked to a reticence women appear to have about pay discussion and salary negotiation.  A 2008 research study provides data confirming this, when it examined gender differences in willingness to ask for a raise:

•"I would never dream of asking":  11% of men, 20%  of women agree

•"I would rather leave the company than ask":  3% of men, 4% of women agree

•"I would negotiate hard": 13% of men, 4% of women agree

With all of this in mind, I was intrigued by the article I read about GetRaised in Mashable.  I got in touch with the group to learn a little more and had the chance for an interesting phone conversation with Matt Wallaert.

What I liked about about his story:

Through the GetRaised process, users are encouraged to present a logical, data-based business case for their raise request.  This forces them to think beyond the "I want, I need, I deserve" mindset that some employees get trapped in.  It asks them to consider the employer's perspective and situation, and to contemplate how they might grow and add value in ways that makes them worth more to the organization. 

By offering coaching and tips, GetRaised helps make the raise discussion a less scary and less emotionally-charged one.

What concerns me:

The data that GetRaised offers to users to develop market comparisons is based on a "mashup" of Bureau of Labor Statistics data and open job postings.  One word:  Ugh.  Matt confirmed in our conversation that they do not want to purchase data - they want to keep the service low cost so that they can continue to offer it at a low price. I get that, but...

Although Matt says that they consulted with 100 HR professionals as well as academics from leading universities in developing GetRaised, nobody on the team appears to have HR or compensation credentials themselves.  This can be a positive, but also a negative.

I asked Matt if he had any advice or thoughts to share with us HR and compensation folks, based on the GetRaised experience to date. What he offered was essentially this: "People often ask for a raise in a very unscientific way.  GetRaised is trying to help change that.  But think about the employer's response; it is often appears to be just as unscientific to the employee."

Why share this with all of you?  I think it behooves all of us to keep track of what's happening at the edges of our profession, particularly in an area as culturally and politically sensitive as this one.  And I think GetRaised, with its flaws, has some interesting things going.  There may be other similar sites and services out there, but I'm not aware of them.

What I'm interested in is your take.  Share your thoughts!

Image courtesy of millionaireacts.com