Your Pay Program Has a Big Mouth

You have a not-so-silent partner in your compensation communication efforts.

That partner? Your pay program itself.

That’s because compensation itself is a powerful communication tool. In fact, everything we do in compensation is communication, so it’s critical that we consider the messages we are sending at each step of the way. My experience suggests that the early steps we take, and the work we do to review/renew our programs on the back end are particularly powerful communication opportunities that we often overlook.

Communication starts even before plan design does, with the way we describe and approach the problem we’re trying to solve. That’s why it’s important to do our homework, dig underneath the surface and get to the roots of the issue — whether it be performance, retention or something else. Our failure to do this, our decision to tweak pay when the problem may be only partly (or not at all) about rewards can speak volumes. When we throw money at what isn’t a compensation problem, people notice — and we can send unintended messages to employees about their capabilities, their motivation, and the organization’s trust in and regard for them.

We also let opportunities slip through our hands when we renew and update pay programs — or when we fail to do so. If we’ve learned nothing else in the past several years, it’s that the world our organizations operate in can change enormously in the space of 12 months. We can’t afford to leave our programs on autopilot, sending messages and promoting efforts that may now be out of sync with what business priorities demand now. A pay program that simply rolls forward into the new year, unchanged or even unconsidered, will speak pretty loudly, too.  It says “same old, same old.” Is that what you intend?

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Make no mistake about it. Your compensation programs speak for themselves. Are you going to let them speak for you?

This article is from the archives of CompensationForce.

Ann Bares is the Managing Partner of Altura Consulting Group. She has over 20 years of experience consulting in compensation and performance management and has worked with a variety of organizations in auditing, designing and implementing executive compensation plans, base salary structures, variable and incentive compensation programs, sales compensation programs, and performance management systems.

Her clients have included public and privately held businesses, both for-profit and not-for-profit organizations, early stage entrepreneurial organizations and larger established companies. Ann also teaches at the University of Minnesota and Concordia University.

Contact her at abares@alturaconsultinggroup.com.

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