06 July 2018
Once there was a concept of life-time job. People used to join one organization and would work there for rest of their life. They would grow with company. Loyalty and relation were given more preference than anything else. Performance, compensation, and growth were important but not as important as emotions and brotherhood. However, now things have changed. More so in last THREE decades. There seems to be a tussle, a kind of tug of war, between performance and compensation. Loyalty, emotions and relations appear like things of ancient time. For an employee, an employer is as good as his last increment; while for an employer, an employee is as good as his performance in last quarter. Both can replace one another at any time and as many times during their life. Who is going to win this war? Will there be any winner? It is difficult to say.
Employees don’t want to link their compensation and growth with their performance. Every year they expect certain percentage of increment. They must get promotion every couple of years. And this should not be linked to their performance. They have irrational comparisons of their compensation. They compare their salaries with their colleagues across functions and with their peers across industries. They are not willing to buy concepts of educational backgrounds, relevant experiences and size or revenue of organization.
Read More about Compensation Versus Performance.
Following factors can influence your compensation in an organization –
On other hand, employers don’t want to talk about compensation and benefits in isolation. Growth and compensation must be linked with job responsibilities and accountabilities. Loyalty alone is not sufficient. Organizations require loyalty with consistent track of performance to help you grow. You cannot move to next level just because you have spent certain numbers of years in one position or role. In schools and colleges, getting 60% marks is considered as first class and getting above 75% is distinction. However, this is not true in corporate world. You must score at least 75% in your annual assessment to be considered for any increment. You must consistently score above 90% in your annual assessment for at least THREE years to be considered for promotion to next level in hierarchy. Irrespective of your score in annual assessment, as a standard industry practice, you shall be classified as High Performer, Average Performer and Low Performer in the ratio of 20:60:20, which eventually implies – Must Retain, Try to Retain and Let Go.
Following factors can influence your growth in an organization –
There seems to be this chicken and egg type of situation. Employees say, “Give us chance. Give us role and compensation and we will prove our abilities”. While the stand of organizations is, “Develop your skills and competencies. Prove your capabilities.Deserve it before you claim it. We will give you growth and development”. Bike cannot move forward while on stand. Similarly, you cannot move forward, if you will not improve capabilities and competencies.
Over the period of time, one thing that has become very clear that relationship development and wealth creation are two different things. Within relationships, there is a wide gap between personal (emotional) and professional relationships. One must understand, respect and appreciate difference between the two. No one does any business to develop personal relations with employees.
Compensation is nothing more than sequence of numbers and irrespective of what you get you will never be satisfied. On the other hand, performance can be described as continuous improvement towards excellence and hence, no matter what you do there will always be scope for improvement. I am not sure who will win the war of performance versus compensation but I have made an attempt to make conceptual clarification. Self-awareness and communication are two tools that can help bridge this gap.
With multiple successes achieved through driving commercially embedded HR strategy and programs across Africa, Europe, the Middle East, USA, and Hong Kong, Sanjeev Himachali, Talent Strategist & Management Consultant exhibits over a decade and a half years of progressive, leadership experience and core competencies in talent acquisition, management, and development, HR program management, compensation & benefits management, and staff engagements. In January 2015 he launched Ecliptic HR Solutions to provide strategic human resource and talent management consulting across BFSI, Manufacturing, Automobile, IT & ITES, Telecom, Retail, and FMCG sectors.
As a Talent Strategist, Sanjeev partners with organization’s hiring managers to find, select, and hire top talent which exemplifies firm’s values and provides a foundation for organization’s future growth. Sanjeev is adept at expediting change management through leadership, differentiated talent models, attracting and developing the best talent, and building a culture of engagement, agility, and innovation. He has proved to be a trusted advisor to organizational leadership in initiating human capital management strategies and aligning HR best practices and processes with organizational objectives.
As a Management Consultant, Sanjeev is credited with pioneering best practice HR systems and processes for clients that brought a new era of employer brand visibility and saw the company’s HR systems heralded among the industry best. Sanjeev has championed psychometric assessment DISC and Thomas Profiling, and developed Managerial Competency Framework for clients, while simultaneously deploying succession planning strategies for high profile roles in organizations. He is highly experienced in the organizational diagnosis and the design and facilitation of events and staff development activities including executive coaching. Sanjeev has earned his MBA in HR and is certified in MBTI, PPA & Extended DISC Practice, and Green Belt Lean Six Sigma.
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