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Feb 5, 2014

Looking to be more strategic in your outlook?

Think dating, engagement and marriage. I don’t mean who you (or your teenagers) are taking to the next Katy Perry concert. I’m serious.

Here’s why it’s like dating. Strategic thinking is the opposite of being passive. Instead of acting like a wallflower, strategic thinkers are alert to opportunities that can improve business results and then apply insights to take full advantage of the opportunities.

The compensation function and engagement

Do the insights have to come from deep MBA know-how? Not if you study your business and concentrate on how to make things better. In fact, there’s at least one strategic opportunity that’s staring everyone in compensation in the face.

A lot has been said about what it takes to engage employees. In fact, there’s been so much noise lately that we often forget what employee engagement means.

Towers Watson offers one of the best definitions, I think: “Attachment to the company and willingness to give discretionary effort.

“Willing to give discretionary effort.” Was there ever a better description of employees who qualify for merit increases and, for that matter, why we pay for performance?

So many different functions in HR — and across your company — are trying to influence engagement, for better and for worse. Are they all in alignment?

No, not so much, but that means the compensation function is in a good position to step up, and step in, as a strategic advisor to marry the efforts.

Reaching across the company

Engagement cannot be achieved if employees are impeded from doing what they know is their best work — because of problems with resources, processes or leadership. The more attached employees are to the company, the more frustrated they’ll become when faced with these problems.

What has this got to do with compensation and strategy?

Here’s where the marriage part comes in: Given the compensation function’s influence on objective-setting, we are in a unique position to reach across the company. We can show our company’s leadership that compensation does influence engagement by raising questions that enable and equip employees to perform.

Instead of encouraging supervisors to go through the motions of keeping objectives fresh, work with your functional heads to use this system more strategically.

This should be your new worldview

For example, instead of emphasizing the infinitely boring question of whether the objectives are up to date, get supervisors to act more strategically by talking with employees about what is getting in their way and how it can be solved — followed by meeting with their functional heads and HR business partners to resolve the problems.

You don’t have to make this an “initiative” or a “project.” Think of it as your new worldview. By encouraging executives to pay attention to whether employees have the ability to get their work done, you will help remove barriers to productivity and build engagement.

If that’s not the definition of a strategic advisor, I don’t know what is.

This was originally published at the Compensation Café blog, where you can find a daily dose of caffeinated conversation on everything compensation.