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It is human nature to try and protect what is yours. Decentralized pay during this time of scarcity unfortunately leads to many managers trying to take care of their people without much thought for the whole. This is a very timely post, and it is more important than ever to make sure that pay decisions are made based on what's best for the entire company, and not just one division.

Very well said, Darcy - thanks!

Something just isn't sitting right with me on this discussion. Mind you I'm not being critical; but just trying to get rid of that uncomfortable feeling. Would anyone with budget authority ever admit that they were being spendthrift in good times as opposed to bad? Shouldn't we be just as careful with compensation dollars in an up economy as in a down economy?


Always important for any of us to hold up our hands and say "wait a minute" when a concept or assertion doesn't sit right. Half of my blog posts are me doing exactly that. Sometimes I'm on to something, sometimes I'm just missing a key angle (and then, hopefully, one of my readers will leave a persuasive comment that shines a new light on it for me - and everyone else).

In this case, I don't know that anyone is consciously being spendthrift in good times. What I have observed, though, is that decentralization leads to different standards and approaches on rewarding employees. And often, as a bottom line result, one part of the organization rewards more generously than another. (I'm not talking about bad practices or plan design, I'm just talking about a different approach.) In times of sacrifice, I think it is important that any sacrifices are shared as equally as possible, but accomplishing that can be difficult unless we can establish a common understanding of all reward practices across the organization.

Does that make sense - or still sit funny?

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About The Author

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    Compensation consultant Ann Bares is the Managing Partner of Altura Consulting Group. Ann has more than 20 years of experience consulting with organizations in the areas of compensation and performance management.

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