Have you ever used a babysitter?  This is when you have someone else assume your responsibilities while you take a break and focus on something else.  The babysitter stands in for you, becomes you during the period of your absence.  Someone else does your job.

Typically we think of babysitting when there’s actually a dependent child involved, but it’s not uncommon for ineffective managers in the workplace to use the same concept when dealing with their employees.  These managers seek to use the pay that their employees receive as a surrogate for leadership – for keeping those workers complacent, retained and generally “in line.”

The practice of manipulating rewards presumes that the employee will chase the money and will be happy with their lot, while at the same time not requiring much in the way of supervision, periodic direction or even meaningful conversation.  The thinking here is that, if provided with enough rewards, an employee will act as desired in order to not jeopardize those rewards.  The goal is to place the employee’s attitude and performance on automatic pilot while the manager is engaged elsewhere.

So far, so good.  Not necessarily a problem, right?  The red flag goes up when you ask whether these monies are warranted by either performance or business need, or are they simply bribes?

What are we talking about?

Scenarios where pay is used in lieu of actual management are easy to spot.

• The Grand Giveaway:  Where managers try to give away as much money as they can to as many as possible, not worrying overmuch with distinctions between individual performances.  The goal here is to build an employee’s appreciation of their manager’s largesse.

• Title inflation: The promise of bloated and meaningless titles that distort organizational structures, for the prime purpose of rewarding employees in lieu of cash.

• Over-rated performance:  Play the good guy by over-rating performance during salary reviews.  Culprits are often seen rewarding activity over results.  So look busy!

• Assured compensation: Take the risk out of rewards.  Everybody receives an annual merit raise, everyone earns a bonus.  This fosters an attitude of entitlement.

• Counter-offers: “Let’s make a deal” attitude to keep resigning employees from actually leaving; a dangerous practice that increases costs and lowers morale.

What’s the cause of this behavior?   Managers typically receive inadequate training (if any) on how to use their company’s pay programs, so many use pay as a crutch instead.  Spending the company’s money effectively and efficiently isn’t on the radar screen.  They use employee pay like a club to get an employee’s attention.  And once they have that attention the manager is off doing something else – with the presumption that pay will substitute as supervision and motivation while the manager is absent – kind of like a babysitter.

Weak and ineffectual managers don’t actually manage their employees when it comes to things like performance direction, leadership, setting good examples and decision-making.  Instead, they want to be liked.  They want to avoid conflict and they don’t want anyone to quit.  They want employees to get along, and to help foster a friendly team atmosphere they try to manipulate pay in support of their efforts.

It’s really kind of a bribe.

So what is “managing” to these people?  It’s not about making hard decisions.  Too often it’s trying to get the most for their employees, deserved or otherwise, whether the organization gains in the process or not.  The manager is focused on their own interests, and is using someone else’s money in the doing.

Why it doesn’t work

Relying on pay as a replacement for management has a short term effective life cycle, at best.

• Employees see arbitrary equal pay treatment as de-motivating to high performers.  Why bother extending yourself if you’re going to receive the same reward as the guy doing crossword puzzles?

• Employees resent favored-son treatment; the names of those who benefit for non-performance reasons will always become known.  There goes your morale.

• No amount of money replaces the value of honest performance direction and feedback.  Those with an interest in learning and growing appreciate the help.

• Absentee managers lose the respect of their employees, who know what’s going on.  Remember that employees leave managers, not companies.

• While employees will take any money carelessly handed out, the organization will not gain because of it.  So these “rewards” are ultimately wasted.

For managers who need a crutch to help motivate and retain their employees, to help them do their jobs, the above cautions likely won’t make a difference.  Their goal is not to manage, but to get-by, to be liked by their employees and to avoid disruptions to their routine.  This is not leadership.

But for those managers who wish to make a difference, who understand that managing employees is a challenging and rewarding role, abrogating responsibility through babysitting is not an option.  They recognize it as the opposite of management, a damaging practice that will not enhance anyone’s long-term career prospects.

When it comes to the design of performance management programs and processes most companies play it safe.  Right smack in the middle of their employee assessment scale is the word “average”; or perhaps they use “meets expectations,” or “solid performer” or something similar.  Each term holds a similar meaning, though – middle of the road.  And isn’t that where managers expect most employee to fall?  After all, the height of a distribution curve peaks at “average.”

Surveys show that over 80% of organizations who use a rating scale to assess employee performance have chosen a three, or five (most popular) or seven scale system.  The common denominator of each system is a middle rating category, the average.

But what if you were one of those odd ducks who chose not to have an “average” rating in your performance review process?  What if you told your managers that they couldn’t call anyone “average;” that there would be no middle ground; that employees would have to be designated as either “successful” or . . . less than successful?

We can’t do that!

Which is exactly what you’ll hear.  Many managers will balk at having to choose between rating someone as either what they consider an under performer, or as an over performer.  That’s the way they’ll see the decision-making process – as forcing them to select what is for them an incorrect rating.  Because they think the majority of employee performance falls between those ratings.  Because they think most folks are average.  They’re doing the job that they were hired to perform.  And “average” is a safe word.

But there are some companies out there who have decided that they want their performance review process to be a less than a passive administrative tool (looking backward).  They want to couple development dialogue into the assessment process and encourage employees to stretch themselves – to look forward.  They want to improve the performance culture in their organization, and they feel that in order to achieve that goal they need to better identify exactly what level of desired performance their employees have been delivering.  Which means that they take away the middle ground.

I’m not here to say that managers are always wrong in their overall perception of employee performance, but perhaps there’s a different way to look at the rating process, a less “easy button” approach that doesn’t provide a default selection for the manager.  Perhaps there’s a method that might help drive employee performance – instead of administering it.

What if the performance review process asked a different question?  Instead of asking how an employee’s performance compared against  a common-man average, what if the question became whether the employee was “successful” in their job?

Successful

Now here’s a word that implies achievement, the gaining of favorable results.  Compare that against what the dictionary would describe as common, ordinary, typical – the average.  An argument can be made that an “average” employee is not necessarily a successful one, and that a successful employee is a better performer than an average one.  For the good of your business I’d suggest that you’d want to encourage more successful employees than average ones.

A common management view of “average” employees is that “we’re not going to get where we want to go with this group.”  The desired goal of a high performing organization will not be achieved on a foundation of common, ordinary and typical employees.

Needs Improvement

What if, instead of saying an employee’s performance was below average (a rating usually seen as just below the middle ground) you turned things more positive, saying that the employee was “on track” but not quite yet successful?  This can be a different, much less negative perspective.  If you want your performance review process to help drive performance, then encouraging employees (“you’re almost there, keep it up“) is a better strategy than negativism.  And if you believe that performance recognized is performance repeated, then you want to make sure that you focus on a glass that’s half-full, not half-empty.

Those who take a risk

Choosing to design a performance review process without designating a middle rating for your performance scale is taking a risk, which is no doubt why most companies steer clear.

• Too many employees could be ranked as “successful,” merely to avoid the negative connotation of “needs improvement.”

• Over-rated employees would be given (or at least they would hear) the wrong message, inflating their perception of performance without delivering the same caliber to the organization.

• The bottom two (of four) rating categories would see little use as “Needs Improvement” retains its strong negative connotation.

• The organization wouldn’t have sufficient merit increase monies to appropriately reward the great majority of employees rated “successful”  – thus leaving little room (or motivation) for lower ratings.

Such a scenario, if left unchecked, could weaken your performance review process to the point of being ineffective – almost pointless.  Those rated less than “successful” would likely fall below 10% – 20% of your workforce – which for most organizations is not a true reflection of current performance.

In that all-too-common scenario many of the ratings might even become reluctant “gifts” meant not so much to recognize performance but rather used by the manager to avoid having to face uncomfortable conversations with disappointed employees.

This is where management training, coupled with a careful and continuous monitoring of the performance review process, would be key to success.  When you don’t provide a default “easy button” you need to make sure that the decision-makers not only understand the rationale of the four-scale rating system, but are on board with it.

One doesn’t create a new HR program and launch it via a few memos and a deck of slides and then expect compliance and success.  Not if you want managers to think and act differently today than they did yesterday.

So kudos to those with a four scale performance rating system.  They’re trying to walk the talk of performance management and pay-for-performance.  I wish them luck.

When you consider the role of Compensation Management it’s natural to first think of the competitive analysis and program recommendation process – where jobs are market-priced, salary structures are tweaked and a merit spend budget proposed for the coming year.  It’s the annual “here’s what I think we should do moment.”

These projects usually consume much of the final quarter, and when you add in the merit review process and short term incentive assessment and payouts compensation practitioners can be very busy for several months running.  To many in senior management, that’s what they do.  That, in essence, is their job.

What about the rest of the year, though?  What’s the role of Compensation Management then, during the day-to-day?

The off season

Dotted throughout the year, during slow periods as well as “all hands on deck” compensation practitioners find themselves constantly challenged by scenarios where the red phone from Leadership has rung.  Questions will be asked, background data researched, and various issues that impact business operations will be explored.  The calls can be unpredictable in nature, timing and import – but have a common theme.   Compensation will be asked to provide information, answer questions and deliver research and analysis reports.  Some of the likely topics that could be raised are:

• Employee turnover is getting to be a problem.

• Our counter-offer policy (or lack) is causing issues with employee retention.

• We have too many red circle (over the max) or green circle (below minimum) employees.

• Managers are asking to increase eligibility for short term incentives.

• Payroll costs are getting out of hand.

• How effective are our pay programs?

• How to secure candidate “X” for the company.

Whatever your response to the question(s) at hand, you should always be prepared for when Leadership follows up with a question – “what do you think“?  That would be like a softball question tossed to a politician, so you’d better be able to hit it out of the park.  You’d better have an answer.

Compensation professionals should always have an opinion as to how rewards can and do (or could and should) affect the business.  You should anticipate the issue(s) that Leadership is concerned about and be ready to provide your own well-considered comments.  You should not simply point at a series of figures and say, “there you are.”

That would not be a career enhancing moment.  That is not managing anything.

The question you want to hear

If your role is to manage compensation, not to follow or administer it, then you need to anticipate the client needs and interests.  It’s like an attorney who advises, “never question a witness where you don’t already know the answer.” So think about what you’re offering up in terms of how business operations might be affected.

To think and act like a leader of the organization you should consider what your facts, figures and recommendations mean for the organization.  Even if you’ve not been directly asked.  On what pathway will your information place the organization, and what might like ahead – given the various options that should be considered.

Some questions that you should anticipate, and thus provide in your response:

• What will this cost, in both hard and soft dollars?

• What if we do nothing?

• What are the risks of the pathway ahead?

• How will these suggestions benefit the organization?

• What do you think we should do? And why?

When Leadership calls, that’s your opportunity to have an impact, to utilize persuasiveness and influencing skills to move the organization in the direction you feel is correct.

Don’t waste the opportunity.

The other day I was trimming the landscape of several plants that had outgrown their space (in Florida everything grows, all year long) when my wife asked me, why are you cutting down those plants?  They look nice and the blossoms have a sweet scent.  Can’t we keep them?

They were ginger plants, and true enough they were pretty and did smell nice – but they had also over grown the area where we had planted them.  Slowly spreading outward they were crowding out other plants and starting to transform our neatly designed landscape into what would soon become an overgrown jungle.   The plants were no longer providing the same value to us as they had done for several years previous.  It was time to cut back or cut out.

Which got me thinking; how hard is it for managers to tell someone “it’s time to go”?  Sometimes employees stay too long at a particular job, year after year racking up higher pay levels while not really delivering more in terms of performance than they did the previous year.  You find them performing the same activities, over and over again – but for increasing pay.

Reliable workers?  Good workers?  Yes.  Expensive?  Yes to that, too.  Is their value to you increasing?  Perhaps not.

After awhile you’ll start to realize that, while good old reliable Bob is doing a fine job, someone else can perform that same job for a lot less money.  So what do you do with Bob?

Ignore him?

Think about it.  If a loaf of bread is priced at $2.00, would you be comfortable with paying $3.00?  Or even $2.50?  For the same product, the same taste?  Would you consider that additional expense well worth it?  Or would you start searching the store shelves for a loaf of bread that costs less and tastes the same?

Creating the problem

How did you get into this fix, having long serving and overpriced employees on your staff, stuck in the same job, year in and year out?

The answer is often simple and straightforward; because they’re comfortable, to the point where they see no reason to change the status quo.

• They like it here; they like the job, their co-workers, the work environment.  They like everything about their situation.

• They know everything about the job(s), as well as the company, and so the stress level is not a concern and they feel able to focus less effort to do the job.  They could do it in their sleep.

• They’re comfortable doing what they do, and have little motivation to do more.  They’re not compelled to break out of their mold.  They don’t see themselves as being in a rut, but comfortably situated.

• The pay is good, or at least satisfactory, so why leave and start fresh somewhere else – where they would have to prove themselves all over again?  To this way of thinking job search is a real bother, stressful too, and should be avoided until absolutely necessary.

That’s why some employees stay in the same job, content to remain on their own private treadmill.  It works for them.  But why do their managers allow this problem to develop?

It’s a management issue

Why are some managers reluctant to take action with these employees; to cut them off or promote them up and out?  Because many times taking such actions isn’t perceived as being in the best interest of the manager.  And there’s the rub.

• The cost and headache of obtaining a replacement; the time it would take, the disruption to schedules, the added stress.

• More work would be created for themselves, filling in for planned projects that still have to be completed; their time lines may be negatively impacted.

• The perceived damage to the manager’s reputation (employees have quit them), and leadership is watching – and perhaps wondering, why?

What’s a manager to do, then?  Moving someone along when there isn’t a performance problem is a tough decision to make and to implement.  Though sometimes it’s the right thing to do, both for the company and for the employee.

• Encourage employees to learn and grow within the company – preparing themselves for better positions.

• Be open to losing an employee to another department, one that may be able to better utilize their capabilities.  Holding on to someone too long doesn’t help either party.

• Managers should expect and demand continued and improved contributions from all their employees; no sitting back and coasting.

• Managers should plan to move employees up or move them out as part of managing an evolving staff.

Ask yourself, where is the balance – of contribution provided (performance) versus value paid out (compensation)?  When the balance tips too far in either direction, it’s time for action.  When an employee recognizes that there is more contribution on their part than value received (more work for less money), they look for the exit.  However, when the manager sees that there is more value (reward) provided than continuing  performance contribution, perhaps  it’s time to consider moving such employees along.

I’m just saying, the day will come – for some employees.  When it does, will you recognize that it’s time to pull the plug?

The business year has ended, but managers everywhere are turning their thoughts to one last Christmas present.  The calculators are out and every eligible soul from Marketing to Manufacturing to Sales, IT, HR and the Executive Suite is trying to figure what their incentive check will be.  For some, it’s still the gift receiving season.

Year upon year the same bad script repeats itself for the annual management bonus process:  objectives created at the last minute, embellished accomplishments dutifully recorded, problems and shortcomings diminished or forgotten and assessment forms looked at with disdain.

More than the mechanics are at fault

The process is flawed, yet the foxes remain in charge of the chicken coup – and they offer little hope for reform.  Because for those in charge the process works, and self-interest pays its own rewards.

True pay for performance can be an elusive concept best remembered from Compensation 101 textbooks, suitable only for life as it should be, not as it is.  Sad to say, but senior management is often the worst offender.  I’ve seen senior executives adjust financial results to ensure that their own incentive awards aren’t reduced.  Senior staff deserves competitive incentives, don’t they?  How can you not provide them with what they need?

Entitlement trumps performance.

While studies suggest that the I-deserve-it mentality has been reduced by the weak economy I believe that it’s alive and well wherever rewards are viewed as payment due for time served, not for effort and results.

It can be an uphill climb trying to persuade leadership that it’s primarily good performance that should provide rewards; that tenure isn’t a compensable factor, that incentive payments should be deserved, not simply an automatic gift of delayed compensation.  Lower level employees are expected to earn their rewards; shouldn’t the same case be made for management?

End-of-year expectation

Have you ever told an executive that their annual incentive might be reduced because corporate or individual performance didn’t meet expectations?  They’d look aghast at the possibility.  I’ve heard from many an executive who became upset when reminded of the review process and that the Board of Directors had to approve awards.  The common attitude was, times up! – where’s the money?

Will the situation be any different for the upcoming incentive cycle?  Bucking the trend of human nature is far from a sure bet.

To change those dynamics, as well as the effectiveness of your incentive plans you need to take action.  With a new cycle beginning it’s not too late to have an impact, to instill a management pay-for-performance philosophy in your organization – even if it’s only one step at a time.

• Performance appraisal shouldn’t be an activity list (“I was very busy“), but a focused statement of achievement against quantifiable objectives.

• Let the assessment tell you the rating, not the other way around (“how do I fill out this form to give a 4 rating“?).

• Ensure that the assessment form language corresponds to the performance rating.

• Completed forms should be required before an incentive payment is made – negating a procrastination trick (“Just process the check.  I’ll get the form to you . . . soon“).

• Have objectives established early in the year, not in an after-the-fact rush at the end.

You’ll need more than a steely look and a waving flashlight to stop a speeding freight train, so educate management about these ineffective and wasteful practices before the cycle restarts.  Afterward is always too late; discipline as a learning tool is best used to prevent problems, not when hands are already reaching into the bag of checks.

Can you recall an instance at work where you made a mistake, an error in judgment, a bad decision?  An “oh cripes!” moment that you would have liked to have had back again?  Perhaps it was a rash decision, a lapse in sound thinking, or simply poor planning that caused you to take a wrong step.  And if you were unlucky, that error was noticed far and wide.

You remember how you felt then, don’t you?  You were likely embarrassed, surprised or even angry.  Certainly you felt awkward that you had messed up and that people had noticed.  To cap it off the wrong people had noticed, hadn’t they?

Bet you won’t do that again!

Perhaps not, but that doesn’t mean you shouldn’t stick out your neck again.  Turtles don’t make for good leaders.

Because when we make a mistake and learn from it, when we use a negative experience to help us prepare for the next opportunity, we grow as professionals – as individuals and as leaders.  That painful lesson will be more deeply embedded in our consciousness because of the fact that we did screw up, made a bad decision or used poor judgment.  It’s human nature for us to remember our foibles, and because of that to hopefully not repeat where we had burned our fingers.

If we were risk adverse and played it safe throughout our career, if we avoided decisions, kept our head down, didn’t stretch ourselves, we’d likely never fly high.  We’d also never be noticed by the higher ups and our career would never quite get us where we wanted to go.

No pain, no gain?

If you use your mistakes as a learning experience, what would you learn if you never make a mistake?  Your ego would swell with self-importance and what had been healthy self-confidence would’ve morphed into over-confidence.  You’d start reading your own press releases, and on that pathway lies a steep cliff followed by a fall.

I remember my father telling me, “at least try.”  That’s good advice for managers too.

So take a calculated risk.  Not a roll of the dice, but a decision or an action based on your knowledge and experience.  Use your professional judgment and put a stake in the ground.  Stand up for something.  Learn from the experience.  And if you stumble, pick yourself up again and get back in the fray.  Just don’t make the same mistake twice.

While most companies talk about the advantages of risk taking, many don’t walk the talk.  Instead, some organizations simply get rid of those who had the misfortune to make a mistake.  In that environment there’s always someone trying to trip you up (passive resistance, nay-sayers, the overly critical, etc.), or to take advantage when you stumble (enter the political animal).  All of which sends a powerful message that risks are only entertained when in fact they aren’t risks at all.

On the other hand, creativity and innovation are fostered in an environment that nurtures decision-making and encourages measured risks as a method of stretching oneself.  Instead of killing the risk-taker when they stumble such organizations seek to stretch the capabilities of their employees by encouraging them to do more than they thought themselves capable.

It’s only a risk if there’s a chance of failure.  Employees who are not afraid of making decisions, of standing up for themselves, of taking a risk for the good of the organization – they should be valued, not criticized or penalized.

In an atmosphere free of threats and traps the leader can emerge and thrive – to the betterment of the company and the employees.

I used to think that, of all the compensation schemes out there, the most detailed, the most carefully crafted, the most committed to memory were for the sales force.  Like the stereotypical jail-house lawyer sales employees could detail to management the inner workings of their incentive plan – and often did.  Nothing got past them.

That may still be true in your organization, but with increasing frequency I’ve found myself immersed in a client’s troubled sales compensation programs, struggling to salvage the incentive schemes of companies whose reward train had plunged off the track.

Studies have shown that it’s often not the design but the communication of the sales comp design that is to blame.  Even quality programs find it difficult to overcome the damage that can be caused through errors in explanation.

Flubbing the message

Plan effectiveness is weakened when a company fails to properly inform their sales force as to what’s expected of them, and how they’ll be rewarded.

Here’s what should be included in every sales plan document.

• Show the money:  Highlight the target incentive figure and you’ll get their attention.  The more at risk the greater likelihood behavior will change.

• Clarity of objectives:  If you want to steer  performance, provide a sense of direction.  The sooner an employee knows what you want them to do, the sooner they’ll start to focus.

• Clarify thresholds and caps:  Two common questions are, at what point do payments start, and are they capped?

• Administration rules:  Not exciting but necessary to help employees understand the plan and how it works.

• How much, and for what?:  Show how payments progress as performance increases, whether using percentages, commission rates or a combination.

• Estimate earnings:  Examples drive the message that better performance delivers greater rewards.

• Limit key objectives:  Focus employee efforts to maximize performance.  Provide no more than four – with none weighted less than 10%.

• Appeal process:  Explain the method of handling payment calculation issues.  Questions are to be expected, but don’t make employees search for remedies.  Be upfront about how to deal with problems.

Your plan should be distributed before the start of the performance year.  Too many plans are still being “finalized” during the 1st quarter.

Directing Traffic

Left to their own devises some sales employees could drive the business off the cliff and into deep financial problems – if the pay is good.

The wrong kind of selling activity can also pump up revenue without a corresponding increase in margin. Generating revenue without profit is just being busy.

Failure to provide proper written communications  will gain you the following:

• Confusion:  What exactly am I expected to do?  How will I be rewarded?  These are questions you don’t want your employees to be asking.

• Dissatisfaction:  An employee unhappy with their incentive plan reduces their degree of enthusiasm and engagement.

• Unwanted activity:  Chasing sales that don’t maximize margins or don’t push new product / service lines.

• Unrealized expectations:  “But I thought my check would be for X“? or
  “I didn’t know you wanted me to focus on that.”

• Missed opportunities: if your marketing focus points in one direction while your sales force heads in another, the achievement of critical results (i.e., revenue, new customers, market share, profits, etc.) may be left in limbo.

If you know what’s considered “success” for the company, and you aim your rewards toward achieving those objectives, then you’ve created a win-win scenario for the employee and for the company.

Just make sure you tell the right folks.

It used to be a common view that the Human Resources department in large companies was more sophisticated, more professional, and more forward-thinking than what you’d expect to find from HR in smaller companies.

We all presumed that the “big guys” knew what they were doing.

But current thinking among some practitioners now challenge that presumption.

The pendulum of thought has begun to swing the other way.  Indeed, sophisticated has become cumbersome, professional has become bureaucratic and forward-thinking has created a chasm of credibility between philosophical concepts and the practical realities that managers deal with every day.

Remember the K-I-S-S principle (keep it simple, stupid)?  Many large organizations seem to have forgotten that common sense caution as they saddled their reward programs with ever more forms, procedures and bureaucracy.

The Evolution of Performance Appraisal

A good example of HR systems gone wild is the difference between a small company performance appraisal and the convoluted processes often followed by large companies.  Herein lies a stark contrast not only of styles but of methodologies and core beliefs that a more complex better way will increase the effectiveness of employee reward programs.

This growth of complexity is commonplace; by the time an organization achieves a certain population size HR feels compelled to complicate their processes – usually in the name of increased employee sensitivities and streamlined procedures.  What worked well before (when the business was smaller) is suddenly suspect, deemed somehow less effective, less desirable.

What began as direct cause and effect, performance followed by assessment = reward, suddenly becomes much more complex, more confusing to some, more aggravating to others.  Communication becomes critical but is often flawed and ineffective as both employees and managers question the additional complexity.

What follows is a brief comparison between how small and large companies approach the critically important performance appraisal process.

The Small Company Experience:

• The employee’s performance is assessed against what’s expected of them.

• Performance discussions usually take place on the anniversary of either employment or promotion.

• Forms are basic, even simple.  They may not be standardized, and one or two pages are usually enough.

• The process doesn’t take a lot of time.  Meetings tend to be short and focused, so both parties can get back to work.

• What the boss says – is what’s going to happen.  The approval chain is abbreviated.

• The money discussion (pay increase) is front and center, a cause-and-effect dialogue.  “You have performed thus and so, and your pay will be changed from x to y.”

The Large Company Experience:

• The employee’s performance may be assessed against other employees, as much as against what’s expected of them (based on their job description).

• Performance discussions use a Focal Point strategy, where everybody is reviewed at the same time.  For managers with more than two or three subordinates, this represents a challenge in terms of time spent and quality of assessments.

• Managers are often subject to intricate, multi-part, multi-page forms designed by a specialty section within HR.

• Employee performance as a group may be viewed against a desired bell-shaped curve of results.  Individual assessments may later be modified to fit the expected / budgeted shape of the curve

• The boss makes upward “recommendations,”  which may or may not be approved.  Thus the reward conversation with the employee ends on a “we’ll see” basis.

• Other topics like developing future performance, improvement strategies / action plans, and “where are we going”? discussions may predominate.  Sometimes talk of pay is deferred, raising the question of whether performance actually relates to reward.   Meanwhile, the employee wants to hear about a raise.

• Employees could feel lost in the bureaucracy, a faceless ID number trapped within a huge spreadsheet.  For them, cause and effect becomes a pep rally concept, with little connection between individual performance and reward.

So what has been lost as the organization grew larger?  Has it become more impersonal, forms-centric, process controlled, and standardized?  And is that better than before?  Perhaps more has been lost than gained.

How did the organization evolve itself into something potentially less helpful, less effective?  Perhaps the poking and prodding of systems and procedures in the name of improvement went too far, until they created a convoluted and twisted version of their desired state.

Perhaps we’ve let specialists over analyze the psychology of a boss rewarding a good performer.  We’ve exchanged hard decisions with real impact for a muted “everyone deserves something” approach.  The following scenario is common.

• Sub-function specialty groups are created within HR, be they Training, Management Development, Succession Planning or a host of others popularized in prevailing industry jargon.  Each group has advocates that push an agenda of change.

• These specialty groups must justify their existence, must validate the worth of their profession, and their mission.  The result is additional layers of forms, procedures and extra time constraints for managers to struggle with.

• Over time these experts lose touch with the managers they should be trying to help.  By pressing their own agenda they tell management how to assess performance.

• Ultimately these groups become blockers, getting in the way of a smooth-running operation.  Objecting managers tend to respond with a campaign of passive resistance.

Can we make our large companies “feel” smaller when dealing with employees?  Can we reverse the model of increasing complexity and confusion?

When the state of affairs has gone off the tracks, how many times have you heard – or used the phrase, “let’s get back to basics”?

Perhaps that thought could be useful today, no matter what size organization you hail from.  Simply return to the fundamentals of performance management, where performance is assessed, which in turn leads to reward.

It doesn’t have to be any more complicated than that.

K-I-S-S

One of the most negative management stereotypes you’ll see is the image of the “yes-man,” that weak-kneed subordinate who is always quick to agree with the boss.   This is the empty suit having no other opinion than what’s expected.  Can you picture the nodding head and vacant smile?

Do you recall the old saying, “see no evil, hear no evil, speak no evil”?  The modern version of this adage describes one who willfully turns a blind eye, refuses to acknowledge and even  feigns ignorance when confronted with activities they should otherwise say or do something about.

Do the compensation professionals you deal with, including the one looking at you from the mirror, provide objective and unbiased counsel to management, or do they simply offer support and justification for what management wants to do?

Do you stand up?

There are always opportunities for compensation professionals to turn a blind eye / closed mouth to improper practices taking place in their organization:

• Finance has lobbied Senior Management that the average merit increase next year should be x%, and you’ve been asked for your recommendation.

• The performance appraisal process is poorly handled and rewards are often granted without legitimate justification.

• A Vice President wants to create an Office Manager title for a long serving Secretary.  This would also entail a higher grade and promotional increase.

Are you one to stand up and be counted, or do you let these events wash over you without voicing concern?

• Do you provide Senior Management with an unbiased recommendation, based on competitive research and an understanding of compensation strategy?

• Do you question those managers who wish to grant increases / bonuses for the wrong reasons?

• Do you strive to hold the line on meaningless titles that increase costs, create employee equity issues and provide the company with little or no ROI?

What’s the worst that can happen?

Are you concerned that having an opinion out of step with senior management will damage your “team player” image?  That your career would suffer because you can’t get along with others, that you “don’t get it”?  Do you find it easier to get along with everyone and ride the tide, wherever it takes you?

Professionals should give the best advice they’re capable of providing, on the basis of technical knowledge, experience and seasoning with business operations.  Let management make the decision.  They have a perspective that’s wider than a singular compensation view, and it’s their company, budget, operations, etc.  Your responsibility is to provide the best objective advice possible, to ensure that decision-makers have their eyes open and understand the ramifications involved.

Life isn’t a tableau of  black-and-white images, but a series of swirling grays.  We should acknowledge that there are contingencies and alternative possibilities available.  But we should not temper either our judgment or our opinions on the basis of what the boss wants to hear.

Management tends to respect straightforward analysis and honest feedback.  However they won’t respect your input if it’s been tainted by political maneuverings or a “how many ways are there to say yes”? mentality.

Your mantra: I will add value

You don’t have to fall on your sword career-wise to make a point, to stand up for yourself, to add value to the decision-making process.  Sometimes you just know the direction management is taking, no matter the facts surrounding the issue.  While leadership may be plagued with personal biases that often trump rational analysis, that doesn’t mean that you should step away from doing your job.

One of the best ways to establish yourself as a valuable contributor is to have an opinion, and not be afraid to voice it.  Even when the management steamroller is moving and you have to get out of the way or be run over, you should always provide your professional input.   You can do this by providing options and alternatives, multiple courses of action for management to consider.  That’s where you’ll be able to present your own recommendations alongside the favored management point-of-view.

Get them thinking; that’s your responsibility and how you add professional value.  It’s also how you build credibility and an invaluable personal awareness with Senior Management.

I once supervised a Compensation Analyst who had learned her craft through professional seminars and workshops.  One result of that education was her favored response when faced with a challenge at work; “the greatest minds in Compensation say that . . . “.   It took patience to educate this budding practitioner in the difference between classroom / textbook answers and workplace reality.

A while ago I came across an HR blog where the author instructed readers in how to create a merit performance matrix.  Very good stuff, I thought, admiring the technical step-by-step directions, except I knew from long experience that the procedure being described would never work in the real world.

While it’s critical to understand the technical foundations of Compensation methodology and practice, first and foremost practitioners need to anchor themselves in the here and now, to know what will work and not work in their organizations – no matter what the finest minds in Compensation think.

Why does Compensation theory sometimes clash with workplace reality?

• Business realities:  Management will know more about a particular business situation than you do.  What you provide to the decision-making process as a Compensation professional is often limited to your subject area, while management possesses the larger picture – the perspective of multiple viewpoints.  Your advice may not fit their business reality, no matter how logical your argument.

• Bias of decision-makers:  Management may feel that they intuitively know the right strategy (they’ve done it before, if-it’s-not-broke-don’t-fit-it mentality, a friend / relation / old college chum suggested an approach, etc.).  Perhaps they read an intriguing article and are now insistent to follow the advice of an author who lacks an understanding of their particular business.  Years ago I worked for a company whose CEO forced HR to implement a particular benefit plan solely because he had read a magazine article.

• Problem avoidance: A favored management solution is to do nothing (you’ve exaggerated it, the solution costs too much, there’s still time, etc.).  These senior managers avoid major decisions until the issue bites them in the leg.  In such a situation it can be dangerous to your career if you try to force a decision.

• Business culture or model: Some initiatives don’t “fit” the organization.  For example, Managers with a laid back organization style will not be interested in recommendations to document uniform policies and procedures and have standardized forms for every action.  Picture your head banging against the wall.

Sometimes those experts who teach Compensation techniques fail to ground their instructions with a caution: check this process out in the reality of your workplace before you take a classroom technique and wave it in management’s face.

Another example:

When designing a pay-for-performance merit increase matrix the standard rule is to place the average increase percentage in the cell block most populated by employees (average performance and average position-in-range).   The sound reasoning for this technique is to better manage the costs associated with that year’s annual increase process.

A lot of years ago I followed that approach in my first compensation leadership role.  I still have a little bump where my head hit the wall.

Here’s the rub; such a technique requires that the matrix change every year, as the analysis demands you study where the average population falls each year.  But management will likely have none of that. They want the same matrix every year, for ease of administration and communication.

Another area that separates the compensation technician from the professional is the ability to deal with what I call the “softer” side of compensation.  Survey statistics, charts and formulae are very good analytic tools, but management will want to know what it all means and what to do about it.  So the answer isn’t simply reporting competitive data, but taking that next step to help management understand and strategize future action.

The contribution you can make to your organization is in blending technical knowledge (the how-to) with seasoning and experience to understand what will work for your organization, considering culture and management bias.  Technical knowledge will give you the same answer every time, but knowing how to use that knowledge like a craftsman’s tool to aid in achieving business objectives – that’s the key to success as a Compensation professional.