by CHRC | Aug 12, 2020 | Competencies, Performance Management, Skilled Labor
Maybe it’s my mom’s fault. When I was only six months old, she discovered that watching the Detroit Tigers on TV captivated me and gave her time to get things done. Then again, maybe it’s my dad’s fault because when he took me to games, he taught me how to keep score, the old-fashioned way, the way that you can go back and check which field a batter hit a pop fly in the third inning. (Foreshadowing my work with performance management tools?)
All blame aside, I love baseball. I still keep score whenever I’m lucky enough to go to a game; mocked until the seventh inning when someone does want to know what that guy did in the previous at-bats. So perhaps it was because I cannot go see a game in person this summer, that over the weekend I picked up Moneyball by Michael Lewis. I loved the movie when it came out and couldn’t imagine enjoying the book even more. But, I did.
It is so amazing to read how recruiters (scouts) with so many statistics at their fingertips, even before the advent of personal computers, still relied on gut and feel instead of cold, hard math. Getting on base and scoring runs wins games. Looking good in the uniform and having “the face” does not. I absolutely love Billy Beane’s line: “Are you selling jeans?”
The biases in business do not differ very much from those exposed in professional baseball. I have been lucky enough to work with the sort of organizational development professionals that design robust competency-based selection tools, yet managers still need to be coached around their empty biases about how a candidate “seems” and “he’s got that look” like he would do well here.
Even though Michael Lewis’s book is now seventeen years old, it really is a great summer read—especially this summer of fan-less baseball. While remote working has eliminated some of baseless management habits that sluggish managers have relied on for decades, if not centuries, if not millennia, there is plenty of work still to do. Perhaps diving into the lessons in this book will remind us to eschew bad old habits, and develop good new ones, grounded in stats, like your coaches used to drill you on every summer.
by CHRC | Aug 5, 2020 | Covid-19, Productivity, Work Place
Photo Credit: ©Jeremy Stenuit
For those of us old enough to remember when there were just three networks, summer TV meant reruns. If you had missed an episode, or had a favorite one, you didn’t mind reruns.
In the case of our blog, we are rerunning one from January 22. We are not sure if you missed it or it was a favorite; but in retrospect, it is downright eerie. When I composed the first paragraph, it was merely an intro to an interesting article we had seen about how to make the workplace healthier and more immune from the common winter cold. We could not have imagined how life would change here in Chicago a mere seven weeks later. Now, walking around Chicago, I see more masks than I ever did when living in Tokyo.
In the early 1990s, I lived in Japan, and was taken aback the first few times I saw people get on the subway, and go about their daily business wearing surgical-type masks whenever they were sick. Over time, I started to realize what a smart practice this was. This time of year, I wish my fellow Americans would put medical masks on as they sneeze and cough spreading their germs all around. Read More Here
by CHRC | Jul 29, 2020 | Diversity, Equity, Inclusion, Executive Compensation
“All I Want Is What’s Coming to Me.” – Sally Brown, Peanuts
A few weeks ago, an article in The Economist touched the third rail of American capitalism: it stated that CEO pay in America was “out of whack.” It even justified its headline by starting off with a quote by the current patron saint of American Capitalism—Warren Buffett.
Of course The Economist backed up this blasphemous claim with several quantitative studies. This compensation consultant had to swallow extra hard because the article not only featured compensation consultants, but found compensation consultants from some of the largest firms that admitted to their culpability in the exorbitant rise of CEO pay.
But, after 25 years in compensation consulting, I knew these inequities of pay did not just happen. I knew of missing variables that influenced the regression line that these authors were desperately trying to draw.
We must go back in time. In one of my first labor economic courses, the professor drew a diagram on the board. The graph and the curves represented a person’s productivity curve intersecting with their compensation curve over time. This graph demonstrated a key concept in labor economics: the back loading of wages. Longevity with a firm was commonplace, and pensions were the reward for such service. Executives were rewarded on the way out with the gold watch, and a lifetime of some earnings held back and now delivered in the form of a defined benefit plan, aka a pension.
Then, almost 30 years ago, pensions began to disappear. The key retention tool for CEOs became Long-Term Incentives (LTIs). But “long term” was a relative term, and generally such incentives were only held back three to five years. Like a 401(k), these “long term” rewards were portable once exercised. The retention value was limited.
So not only was lifetime employment gone, so was the incentives for it. How would companies recruit and retain top executives? The competition for top talent became more intense, higher wages were demanded. The quarterly call for greater shareholder value shortened the execution runway for executives, further pressing wage demands higher. Do better; earn more. However, the data shows the correlation between pay and performance is weak, if non-existent.
Companies need to acknowledge that the long journey from the days of back-loaded wages to today’s “obscene” incentive packages for executives has had little influence on company performance. Perhaps that guy down the hall with the 30 year pin was the missing variable all along. Read More Here
by CHRC | Jul 22, 2020 | Compensation, Diversity, Equity, Inclusion
By Lisa Aggarwal
Have you watched the Hamilton movie? How many times? I’m on my third time already; getting the most out of my Disney + subscription this month, thank you! I cannot get enough of this masterpiece, which I consider the most important Broadway musical of my lifetime. Leslie Odom Jr. earning a Tony for his role as Aaron Burr was a no-brainer. His talent extends beyond the stage, however. He has also been a powerful voice for the theater community in earning their worth. When you think about it, the story of Alexander Hamilton is about money and the creation of our treasury system, one of the many “systems” that exist today.
In a Los Angeles Times article published in late June, Odom Jr. reflects on how the theater industry has historically been devoid of persons of color and how “Hamilton” is quite the exception. Also exceptional is the theater industry itself, which unlike film and TV, has not historically provided residual pay for enduring classics such as this one. He seeks to build generational wealth for himself and castmates by revising that antiquated pay system.
PayScale Inc., which analyzes compensation data, found in its Raise Anatomy Report in 2018 that of the 37 percent of people who have asked for a raise, white men were the most likely to receive one. Reasons vary, but there are steps that you can take to better prepare yourself.
Systemic issues are being brought to light in so many aspects of society, and I’m optimistic that equitable pay for women and persons of color will also be a priority. In the meantime, be sure to advocate for yourself and understand how your job is valued in the external marketplace. Do research on your role and understand how pay is determined. Internet resources are not foolproof but can be a good starting point. If you are changing jobs, negotiating your starting pay will establish your baseline for years to come. Many states, in an attempt to rectify historical pay discrimination/underpayment, have laws that prohibit an employer from asking for previous salary information. It is crucial to ask for what you believe your experience warrants in terms of pay. It really does start with you, because we don’t get what we don’t ask for. After all, Hamilton “got a lot farther by working a lot harder, by being a lot smarter, by being a self-starter.”
by CHRC | Jul 22, 2020 | Compensation
By Lisa Aggarwal
Have you watched the Hamilton movie? How many times? I’m on my third time already; getting the most out of my Disney + subscription this month, thank you! I cannot get enough of this masterpiece, which I consider the most important Broadway musical of my lifetime. Leslie Odom Jr. earning a Tony for his role as Aaron Burr was a no-brainer. His talent extends beyond the stage, however. He has also been a powerful voice for the theater community in earning their worth. When you think about it, the story of Alexander Hamilton is about money and the creation of our treasury system, one of the many “systems” that exist today.
In a Los Angeles Times article published in late June, Odom Jr. reflects on how the theater industry has historically been devoid of persons of color and how “Hamilton” is quite the exception. Also exceptional is the theater industry itself, which unlike film and TV, has not historically provided residual pay for enduring classics such as this one. He seeks to build generational wealth for himself and castmates by revising that antiquated pay system.
PayScale Inc., which analyzes compensation data, found in its Raise Anatomy Report in 2018 that of the 37 percent of people who have asked for a raise, white men were the most likely to receive one. Reasons vary, but there are steps that you can take to better prepare yourself.
Systemic issues are being brought to light in so many aspects of society, and I’m optimistic that equitable pay for women and persons of color will also be a priority. In the meantime, be sure to advocate for yourself and understand how your job is valued in the external marketplace. Do research on your role and understand how pay is determined. Internet resources are not foolproof but can be a good starting point. If you are changing jobs, negotiating your starting pay will establish your baseline for years to come. Many states, in an attempt to rectify historical pay discrimination/underpayment, have laws that prohibit an employer from asking for previous salary information. It is crucial to ask for what you believe your experience warrants in terms of pay. It really does start with you, because we don’t get what we don’t ask for. After all, Hamilton “got a lot farther by working a lot harder, by being a lot smarter, by being a self-starter.”
