Forget drugs, embezzlement, investment banking, or racketeering. The real answer to how to get paid well can be found in last Sunday’s New York Times.
On a conceptual basis you get paid well when there is a high market price paid for your work. Part supply and demand, part value equation (cost/effectiveness = value ), pay in part is what you do, how well you do, and who you do it with.
And there is nothing “fair” per se about pay: the same job (and performance) that might pay you $200K at Company A might pay you $350K at Company B. Trust me on this one – I’ve been in exactly that position.
But as psychologists and HR types should be the first to tell you, pay is in part relative. The person who is happy one moment to get the pay bump to $100K is unhappy the next when they find out their slug of a poor contributing / poor performing peer just got the same pay bump and is making as much as they are.
And that job that paid $200K at one company and paid $350K at another may not come – as the saying goes – scot-free. My experience with parts of the entertainment and financial services sectors (think asset management and big time performers) is that relative higher pay levels can lead to higher levels of broad organizational entitlement: the AP (or HR) specialist who is not in the direct business of the business suddenly becomes the latest prima donna. To crib a Joan Cusack line from Working Girl, “Sometimes I sing and dance around the house in my underwear. Doesn’t make me Madonna. Never will.” The same is true of people peripheral to the business of the business in higher paying industries – it doesn’t mean that the have the value of people in key business value creation roles yet creeping entitlement can make them act that way.
So how do you get paid well? You can get paid well by working for people – or companies – that really value and reward performance. Like Rip Kindall, whose was interview in the March 14, 2010 New York Times was in the Corner Office section.
Any by the way, forget many of those other companies who talk about their pay for performance programs. I have seen very few organizations that when push came to shove really were ready to give inconsistent or marginal performers a full dose of compensation reality therapy.
I have gone out of my way to shop at the Container Store, and everything I’ve ever received has been great service with a friendly face – people behaving as if they cared and wanted my business.
Kindall’s pay strategy seems simple: “Another (principle) is that one great person could easily be as productive as three good people. So we try to pay 50 to 100 percent above industry average.” Kindall also talks about the value of relentless communication and transparency: trust people with information, and if there’s a doubt, over involve employees rather than under involve them.
So the short answer to how can you get paid well is to work with or for someone who behaves – e.g. how they pay and treat employees – that people are critically important to their business.
Life Back West is an occasional set of writings focused on ways people, teams and organizations can be both more effective (doing the right thing) and more efficient (doing the right thing well). More about executive and team coaching services can be found at the “About J. Mike Smith and Back West, Inc.” sidebar or the “Hire Me” tab above.