Compensation - It Was Never Like Vanilla Ice Cream
When I tell someone that I am a compensation consultant it is inevitably followed by, “You need to talk to my boss.” This is true when people are hourly or salaried. It is true whether they barely make a living wage or whether they are part of the “1%.” People just don’t love their compensation. It isn’t like vanilla ice cream.
Vanilla ice cream is yummy (yes, that is the scientific term). It is nearly universally loved. It may not be everyone’s favorite flavor, but pretty much anyone is happier when they are eating it. This is true when the ice cream is that weird unmeltable stuff inside a cheap ice cream sandwich. This is true when it is handmade gelato at a Michelin starred restaurant. It is true when it is a soft-serve cone served out of a truck parked on the side of the road. It is hard to find someone that is truly dissatisfied with vanilla ice cream.
Compensation? Not so much. Compensation professionals tend to write this off as a product of “people are never satisfied.” But vanilla ice cream would seem to crush this argument. Somehow the always complaining, never satisfied, compensation ingrates are happier when they eat vanilla ice cream. It’s not that they are “never satisfied.” It’s that they are never satisfied with their pay.
I often wonder if some company has figured out the secret of making their pay as pleasant as even the lamest vanilla ice cream. Is it possible? If so, what would it take? Would 15% more base pay make the difference? 50% more? We know that tons of money in incentive value doesn’t work. Tons of people have amazing incentive pay packages, but dissatisfaction remains an issue.
You have to assume that the first attempts at vanilla ice cream were failures. If you have ever tried to make it yourself, you know that it requires just the right mix of dairy, sweetness, vanilla, cold and churning just to make a passable batch. There is no way that happened without a ton of trial and error.
Although people have been paid for a very long time, our current methods of paying people are not all that old. Some companies continue to work at creating the perfect recipe, but a far greater number seem to assume that satisfaction is unachievable. What other excuse can there be for doing something again and again in a way that does not make people happier? If better is possible, then it should be our main goal. If not, then why are any of us doing this?
I’d love to hear about your successful, and not so successful, attempts to do something truly better with your pay programs. I am sure other readers would also be fascinated to learn about approaches that have accomplished what so many believe to be impossible.
For more information on our entire rewards consulting services and compensation solutions, visit our website. Send us an email at info@futuresense.com.
Dan Walter is a CECP, CEP, and Fellow of Global Equity (FGE). He works as Managing Consultant for FutureSense and has three metaphors for every occasion. Dan is also a leading expert on incentive plans and equity compensation issues. He has written several industry resources including the only resource dedicated to Performance-Based Equity Compensation. He 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.
