We all know the story about Sisyphus, the man who was sentenced for eternity to roll a stone up a hill only to have the stone roll back down and begin again. I have been speaking to compensation professionals recently who seem to have assigned themselves this same punishment. In one case, I recently spoke to a company who has placed communications at the top of their “needs” list each of the last few years. They are fully aware that their compensation programs will be more effective if their employees better understand them. They even put together a project plan each year. Even with this understanding and planning they have ended each year without a major communication accomplishment. One year their budget was cut. One year they had a big corporate action. Another year they had someone on maternity leave. All are legitimate reasons, but each rings as a hollow excuse when starting another new-year in the same place as the last.
In another case, I worked with a company who had put in place long-term incentives for several years in a row that ended up paying out at 0% each cycle. Each year they used the same metrics and essentially the same goal levels. Each year they came in below threshold. They used the same consultant to create these ineffective plans each year. When I asked why, the response was that the consultant understood their industry and designed their plans around market trends. In the end, they paid to have plans designed and implemented. However, the accrued compensation expense could not be reversed and they delivered absolutely nothing to their participants. Most importantly the plan did not seem to have any direct impact on corporate performance.
In the final case, a company built over many years a complex system of spreadsheets to “automate” the administration and reporting for their unique compensation plan. When they started the spreadsheet, the industry had not yet built tools to support their plan. Over the years the industry caught up, but the company didn’t have the time or inclination to replace their spreadsheets, even though they had become slow and job limiting for the compensation staff. In a matter of months, after finally deciding to replace their spreadsheets, they were able to migrate to a more automated solution that allowed one staff member to be promoted to an open position and everyone else to access information whenever they needed it.
In the first case, it seems as if the task was simply too big. The goal of creating a comprehensive communication plan was more than could be accomplished with the staff available in the time allotted. This resulted in the project getting pushed off to the side for “more pressing” concerns, even though communications was the highest priority task at the beginning of each year. The company has now carved up the communication project in smaller pieces and things are starting to move forward. It will take two or three years to get everything done, rather than the one year of the original plan. But, the past plan resulted in nothing being accomplished in a three-year span. Something is better than nothing.
In the second case, the company brought in a new consultant with a fresh perspective. They kept much of the plan structure the same, while adding metrics that were better integrated with the participants’ direct deliverables. Whether the goals will be made is still a question, however it is clear that the participants are now performing because of the plan, rather than in spite of it.
The case of the home-built system is all too common. Pride in the work it took to create such a system along with a feeling that providers will never do it exactly the same way can hinder progress. Each year someone became less of a compensation professional and more of a “super-duper spreadsheet expert.” Everyone suffered and every year started looking like the prior.
As we move out of year-end, take a moment to evaluate everything you do. You may find a few self-imposed “punishment boulders” in your task list. Take a few moments to evaluate why you allow them to continue. You may want to consider pushing a different rock up the hill.