The basic scale used in western music incorporates 12 notes. The scale has only five lives (staves). This combination of a simple structure and limited elements has been essentially unchanged for hundreds of years. Somehow new music is created every second of every day. These limited components have given us Beethoven’s “9th Symphony”, Gershwin’s “Rhapsody in Blue”, John Lennon’s “Let it Be” and literally hundreds of thousands of beautiful, motivational and at times life-changing pieces of music. Musicians do not see the notes and staves as restrictions. They use them as touch-points for the imagination. Compensation professionals have a similarly limited tool set. Cash, Shares, Benefits, Rewards and Career Development are our notes. Immediate, short-term and long-term compensation and recognition are our staves. These components can either become as set of limitations that squash growth and evolution, or their own set of touch-points that allow almost limitless evolution and creativity.
Increasingly, we live in a world that is focused on market data. While it is important to know what's popular, we risk becoming karaoke performers where everyone attempts to perform the same song in the same way. While karaoke can be fun as a hobby, it does not work well as a profession. Even the best cover-bands are not as well respected as most fleeting one-hit wonders. At least the latter did something truly memorable. Being a cover-band you simply do what others did before you (usually not as well). Someone else wrote the songs and determined a good way to perform them. They recorded them and now they can be learned by note. If the extent of your passion and vision is to fill a hole on Thursday nights then saddle up, rope that cloud and enjoy!
However, music is both a science and an art. It is a world with its own language. The science is in the way the notes progress and overlap. It is creating tempo and rhythm that speaks to the audience. The art is in creating the emotions and response from the audience. A simple mantra to explain the goals of music is Attract, Motive and Retain. Sound familiar?
Compensation is also a science and an art. We must create programs that effectively overlap and support each other. Our structures have to fit within the framework of acceptability and generally recognized norms. Job grades, banding, compa ratios and other unique industry terminology describe the basic rules and measurement. But, just like singing a famous song is unlikely to make your famous (for long), copying another company’s compensation plan is unlikely to make you successful.
Great musicians use prior music as a theme, or leaping point for new music. You hear the sounds of Mozart in the Beetles. You hear the sounds of Chuck Berry in U2. The music is not the same, but it retains some of its roots. In rare occasions truly transcendent musicians cut ties from the past and create something wholly new. These are the true outliers and they change things for all who follow. Whether you build on the past or escape it entirely, the art is in doing differently what has been done before.
The ability for a company to attract, motive and retain its employees is founded in the art of the plan. Seeing the notes and staves of compensation as a limitation will lead you to failure. Copying someone else’s plan also has limited potential. Very few companies can transcend the past completely to create something new. The most successful companies reference the past, while making their programs as unique as their company.
Compensation programs must reflect the ethos of your company. Each employee plays their instrument and does their job uniquely. You must use your understanding of the science of compensation to provide a framework. Then use your company culture, goals and imagination to build the art of the program. Management must conduct this symphony through direction and communication. Every new song won’t be great. In fact, most new songs are never even heard. Do your research and be willing to explore and throw out multiple ideas until you find the ones that fit who you are. As you grow and change, make sure your programs grow and change too. No one follows bands where every song sounds like the last one. Be confident that, if you have found the sound that your company likes, they will be willing to follow you as things evolve.
BONUS QUESTON: What song is Stickman conducting in the image above?