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Pay for Performance Matrix with Maximum Penetration Targets

Yesterday’s Advisor featured the first 5 of Consultant Whitney Herrington’s 7 alternatives for deciding on merit pay. Today, alternatives #6 and #7.


Matching Your Total Rewards to Your Talent

"In yesterday’s Advisor, we covered Consultant Jennifer Barton, SPHR’s tips for maximizing your total rewards program. Today, we discuss what you can do to make it more effective."

Start by taking a talent inventory, says Barton, who is chief operating officer of Willis North America Human Capital Practice. She made her suggestions at the recent SHRM Annual Conference and Exposition in Orlando. You might start by populating a chart such as this, she says:


Is Zappos’ Radical Approach to Recruiting Right for You?

"Yesterday’s Advisor featured BLR legal editor Jasmin Rojas’ take on Zappos’ new approach to recruiting—all on social media, no postings. In this issue, more of her thoughts about how you may learn from their initiative."

In the past year, Zappos received about 31,000 applications, and only hired about 1.5% of the applicants. This prevented the company’s small recruiting team from “working in a purposeful way,” according to Mike Bailen, senior HR manager. Thus, the onus here will really be on the candidate to make him or herself stand out from the crowd in a much less impersonal setting.


Lots of LinkedIn Connections Means Lots of LinkedIn Results

"Yesterday’s Advisor featured the first 6 of consultant Donna Serdula’s tips for maximizing the impact of your LinkedIn page. Today, the rest of her tips, plus an introduction to the all-things-compensation-and-benefits website,®."

[Go here for tips 1 to 5]

6. Build Connections

It’s important to have a lot of connections, Serdula says. This is because first connections can look at each other’s first connections. You get to see their updates/posts, and if they know someone you want to know, you can ask for an introduction via LinkedIn. You also can endorse each other’s skills.


Make Metrics Meaningful to Management

"The metrics you keep may be meaningful to you, but will they be meaningful to management? Is the analysis you provide to the C-suite in line with the strategic plan? Is it information that is useful in strategic decision making? If not, how can that be changed?"

Metrics let people make decisions based on objective information rather than simply guessing or going by instinct. Metrics also let people know what is important to the organization, since a metric that is tracked will be analyzed.

HR metrics have historically often focused on the past. For example, HR metrics often include things like turnover or time to hire. These data are useful but look only at raw info depicting what has happened, as opposed to assessing the “why” behind the data. Assessing the “why” is what will allow business leaders to make decisions accordingly. This is where HR professionals have an opportunity to change what metrics are presented and really make a strategic impact for the organization.


Wage Compression? Use the ‘Compression Triangle’

"Wage compression (when lower-level or less-experienced comp bumps up against or exceeds the comp of higher-level or more-experienced employees) is a bit of a nightmare, and few comp managers avoid it."

The first thing to recognize about compression is that there are no secrets at work, says consultant Brown. People are going to find out what other people make. They may talk openly or it may be relatively innocent, he adds. For example, your life insurance is half of salary, and employees are sitting at lunch discussing insurance. The employee says, “I have $25,000 and I don’t think that’s enough.” Everyone listening now knows this person makes $50,000.


Goal-Driven Profit-Sharing? Sure

"Yesterday’s Advisor covered straight and hurdle-rate profit-sharing; today, goal-driven profit-sharing plans."

[Go here for 1. Straight and 2. Hurdle-Rate Profit Sharing]

3. Goal-Driven Profit-Sharing Plans

In a goal-driven profit-sharing plan, profits are used to establish an incentive opportunity, but employees also must earn that opportunity, based on achieving other goals. These other goals are broad corporate goals, rather than unit operational goals, which are used to highlight and focus all employees on the important behaviors for business success.


Profit-Sharing Primer—the 3 Types of Plans

"A profit-sharing plan is a group incentive plan that includes all employees in an organization and that focuses on overall business unit profit (or a similar bottom-line financial goal). What are the advantages and disadvantages?"


  • Funded from profits, so there is low risk for the company.
  • Can be used to supplement company retirement contributions.
  • Can be linked to company objectives other than profit.
  • Provide an opportunity to train employees on financial measures and the operational business factors that affect those measures.
  • Easy to integrate with suggestion plans and other reward and recognition systems.
  • Can be either pay-at-risk or add-on programs.


Practical Examples: FMLA to Care for Children 18 and Above

"In yesterday’s Advisor, we offered guidelines for the minefield of FMLA leave for children 18 and older. Today, concrete examples from DOL of how to manage this leave, plus an introduction to the all-things-compensation-in-one-place website,"

My 20-year-old daughter has been put on bed rest because of her high-risk pregnancy. I am the only one available to care for her. Can I take FMLA leave for this reason?

Maybe. In order to take FMLA leave to care for your adult daughter, she must be incapable of self-care due to a disability and you must be needed to care for her because of a serious health condition. While any incapacity due to pregnancy will be a serious health condition for FMLA purposes, pregnancy itself is not a disability. However, pregnancy-related impairments may be considered disabilities if they substantially limit a major life activity.


Development, Mentors, Opportunities, Risk, and Reward Keep HIPOs Engaged

"In yesterday’s Advisor we offered tips for handling the difficult situation: high potential employees low on the career ladder who are antsy because Boomers won’t retire. Today, more tips, plus an introduction to the unique guide just for HR “Lone Rangers”—the one-person HR departments."

Here are some more tips for managing HIPOs (high potentials):

  • Increase risk and reward. This might mean giving more at-risk salary in the form of bigger bonuses or incentive pay for outstanding performance. Having more say over final take-home pay can allow HIPOs to feel more in charge of their career outcome, even if the title isn’t changing immediately.
  • Provide development opportunities. This might include training programs, conference attendance, certification opportunities, and more. The key is to ensure that there are continual opportunities to gain new skills and grow. Look both externally and internally within the organization for ideas.
  • Give them a mentor. There are people in the organization who can help these employees learn, grow, and better understand the organization as a whole. Be sure to choose the mentor wisely—he or she should be a good match on an individual level, not just chosen at random. This can be difficult to implement, but pays off when done well.
  • Keep a performance review schedule. Even in organizations with a performance management system firmly embedded, it’s easy to let employee performance reviews take a back seat. Don’t let that happen. Especially for HIPOs, getting feedback on performance can be invaluable when it comes to staying motivated. Performance management can include discussions about career progression and development as well, as we noted above.
  • Ensure the HIPOs’ supervisors are on-board with these efforts. Many of the above programs will fall apart without the active management by the direct supervisor of the HIPO employee. Work with your supervisors on all of these steps to ensure everyone is on the same page. If necessary, move HIPO employees outside of the standard organizational system and allow them to report to someone else in the organization when doing so makes sense for that individual.
  • The key to all of this is showing HIPO employees how much they matter to the organization. By following some of the above strategies, employers can make a big impact and reduce the likelihood of turnover among HIPOs, even without fast career progression.


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