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Ann, I've enjoyed your analysis over this series of posts but I'm left scratching my head. When Pink says take the issue of money off the table is he really expecting a 75th percentile or above solution? That's not the vibe I get. Or is the problem that he makes it sounds so simple it couldn't possibly mean adding 30% to your paybill? Because if your rough and ready survey is anywhere near representative, well, surely that takes his solution off the table for most companies.


I realize it isn't the vibe people get from Pink - which is part of my issue, because as someone who doesn't actually design or manage pay programs, I'm not sure the question even occurred to him.

Also, what I take away from my "rough and ready" survey is that, while 30% is an average response (and potentially a conservative one compared to the Netflix example), the reality is that it could vary from substantially below that amount to substantially above that amount, based on a lot of factors. To me, that suggests that we need to take a careful look at a specific organization situation to answer the question in a more accurate manner.

What we also know, from the Netflix example and available research on the membership model, is that the "taking money off the table" approach to pay cannot succeed in a vacuum, but must be part of a coordinated and disciplined talent management approach that also encompasses staffing, performance management, and employee separation. For the right organization (but obviously not all organizations), this approach could prove to be a very effective way of rewarding their staff.

Thanks - as always - for the thoughtful comment!

"I'm not sure the question even occurred to him."

I fear you are correct.

Intrinsic motivation won't put food on the table or pay the rent. When there is no competition from pressing economic demands or other basic psychological needs, creativity can be more easily unleashed. Since most people are better at spending than they are at earning, guess which approach is generally considered more important? Those with lots of money or secure academic positions are not troubled by such mundane needs. Every value component should be squeezed out of every mechanism possible, as Ann has summarized.

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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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