Compensation Dentistry – The Tooth Fairy Years (part 2)

Baby Teeth, Why care? They fall out and are replaced with something better, so why worry about them? Dentists actually refer to them as your primary teeth, which already makes them sound more important. Thumb-sucking can change the angle of your teeth, impact your bite and make your mouth sensitive for life. Poor hygiene can damage the gums which are the foundation of your teeth for the rest of your life.  Doing things right early is important to better teeth later in life.

The way you pay people when your company is small can impact things for years after you have grown. Paying people far too much may carry forward for decades. Over-granting equity can leave you with nothing to use when you really need it down the road. These things are usually correctable, but it often requires hiring a trained specialist. Much like going to an orthodontist to get corrective braces, the correction process can be expensive and is not always pleasant. And those corrective braces seldom work as quickly as you’d like.

Poor hygiene is a far more serious issue. The results of simply not doing the basics to take care of primary teeth may cause irreversible problems. Just like your teeth impact your speech your pay can impact who you hire, the kind of people you keep and whether you will succeed at all. Pay is a foundational component of your future success. What you pay someone today sets an expectation for them and for every hire of a similar person. The only correction for really poor teeth may be pulling them and getting fake, but better, replacements. This process can be more difficult when you are pulling people to replace them with new people. Once you have let pay get out of hand, getting it back in control may be more effort than you are willing to make.

In the end, the most important lesson about caring for baby teeth is how to build good habits. If you learn to brush and floss every day as a child, it is far easier to continue that process as an adult. Talk to devoted thumb-suckers. They are out there, as adults, still struggling with the urge, and often still dealing with the pitched teeth that often come as a result. Learning how to create a basic compensation philosophy, applying a pay strategy and pricing approach consistently and thoughtfully considering the long-term ramifications of incentives given today are all pieces of building a good compensation habit.

Even after the last tooth is put under a pillow and purchased by a sneaky fairy, the lessons learned early on contribute to your future success. Getting pay “just right” early on is nearly impossible. Getting into the practice of making the effort to get it right is totally doable and will pay dividends for years.

Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He works as Managing Consultant for FutureSense. He has three metaphors for every occasion and is a leading expert on incentive plan and equity compensation issues. He has written several industry resources including the only resource dedicated to Performance-Based Equity CompensationHe has co-authored ”Everything You Do In Compensation is Communication”, “Equity Alternatives” and other books. Connect with Dan on LinkedIn. Or, follow him on Twitter at @DanFutureSense.

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