A Comp System To End Lip Service
I wasn't Overjoyed, but I was Moderately Joyed, to read in this issue that business performance improvers are turning their attention to the sticky topic of compensation. That topic has stuck me personally a number of times.
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For employees, asking for a raise combines the worst elements of your sense of self-worth (which may turn out to be surprisingly debatable) and a sense of panhandling. Employees go to considerable effort to make a case for a raise. Some construct elaborate rationales that they present to managers using PowerPoint documents, testimonials from colleagues, and federal data about the cost of living. Others spend hours perfecting plaintive crying and the ability to make blood run out of their ears. For managers, on the other hand, being asked for a raise tests your ability to find synonyms for “no” and to point out an employee's deficiencies without destroying his morale or having to clean unsightly blood stains off of costly office furniture.
I've experienced firsthand a variety of the methods that companies have traditionally used to manage compensation, and I've observed that each has its own weaknesses. When I began my career, my employer had a policy of giving raises based solely on length of service. When you hit an anniversary date, you got a predetermined raise. This was disappointing because it failed to take into account the lengths to which I went to deliver substandard performance.
I then worked in a company with a large union workforce, where raises were doled out in strict accordance with the pay scales the union negotiated for its members. This removed any temptation for nonunion workers to join up because they got the benefits of the union's effort anyway. Again, I was treated just like my colleagues, much to the disgust of my colleagues.
Later, I worked for a small company that had no system at all for determining raises. If you requested a raise, you were greeted with the same kind of response you might expect were you to ask your manager to give you his spleen. The only employees who received raises were the ones who had successfully attached their lips to the hindquarters of the company's president. Not surprisingly, this quickly led to unacceptably high levels of sick leave due to lip injuries.
I now work for myself, so granting raises is pleasant, productive, and painless, although I am constantly haunted by the rumor going around that my job might be outsourced to Indonesia.
Fortunately for the rest of the business world, help in devising fair and effective compensation systems is now reality, coming — as many improvements do — from anonymous software designers in Mumbai. Yes, it now appears that through computer programs, companies can instantly access relevant information from across the organization, align pay with performance, and integrate compensation data with other workforce performance and talent management systems to prove to employees why their request for a raise gives managers a really good laugh.
Most employees want to see these new systems applied first to CEOs, whose compensation is often several hundred times higher than the pay of the lowest-level employee. A CEO in a company I know received a raise of several million dollars last year by skillfully guiding his company to the brink of bankruptcy. Now, that's a job I could have done for considerably less. In fact, a number of employees showed up at the annual meeting to voice their displeasure about this particular executive's pay, but they were unable to do so. Lip injuries, you know.
Dan Danbom writes humor for a number of publications. His latest book is “Humor Meets Your Workforce: Make Laughter One of Your Organization's Goals.”

