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The Folly of Communicating Compensation

I've shared this story often (apologies if you've heard it before). I once worked for a rather large company (you've all heard of it) and we would have yearly meetings to go over financials, plans, etc. These meetings were universally reviled by the individual contributors as a waste of time.

They would spend an entire meeting talking about how we met goals, achieved so much, and how we had such great employees. Executives would say "it is clear that we have a lot of A players, which is why we hired you". They firmly believed our professional love language was affirmative words.

Then the compensation slide would come up and they would proceed to tell us how they had compared us to other companies, in our industry and in our areas, and our compensation was on par with everyone else's, so there was no need to pay us more than the average cost of living increases. They thought they were showing how they were conscious of our concerns and that they were addressing those concerns. Instead, they openly told us that while we were "A players", they felt perfectly fine paying us like "C players".

They always wondered why we exited those meetings less engaged than prior to the meeting.

When developing and thinking about compensation programs, make sure you aren't contradicting yourself. It will destroy engagement and trust - and you may never get it back.

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