The Do's and Don't's of Resume Building

A lot of people offer advice on resumes but the truth is for the most part, they are suggestions: a resume is your own voice to a potential employer. So whether you have the perfect template for your resume or put it on pink paper with a nice scent and maybe a video, well, own it. But there are some pieces of advice I think are helpful. Two recent articles put it in good terms.

From Brazen Life:

A recruiter will glaze right over large chunks of text on a resume because paragraphs don’t stand out. List your accomplishments in bullets to improve the chances of catching the recruiter’s eye. If you submit most of your resumes through online applications, you may be tempted to write in paragraphs because bullets don’t always copy well into form fields. Don’t give in to this temptation! 

It's hard for some people to keep it short and sweet but each job should be able to be broken down into quick bulletpoints. Save the paragraphs for the cover letter.

And from US News and World Report on red flags on a resume:

Grammatical or spelling mistakes. Mistakes can get your resume immediately tossed, because they convey to an employer that you don't pay attention to detail. Employers assume that you've polished your resume more than you will most documents, so if you have mistakes in it, they assume your work will have even more errors.

Not every job requires you be a good writer but it shows that you don't give a hoot about your work if your most personal document--your resume--can't be given the care needed.

Most of the real do's and don'ts with resumes are common sense but some of them require a little more thought. Make sure that as a resume writer that you are following a format that you would want to receive as a potential hiring manager and if you're a hiring manager, understand that not every resume needs to be cookie cutter to be accepted

Compensation 106: Variable Pay

The final feature in our Astronology six part series is here! In this issue of Astronology, we will discuss variable pay. WorldatWork’s 2012 Compensation Programs and Practices Survey found that 84% of organizations use some form of bonuses or incentive compensation to reward employees. With the popularity of variable pay, there also come questions, such as: what are the pros and cons of some different variable pay design options?  Does one variable pay design fit all?  Should the variable pay design change over time?  We will explore these questions and more in our final Compensation Practice Basics article.

Variable pay is a form of compensation that typically is earned by accomplishing specific goals, and is not equally paid throughout the year. It is also referred to as “performance pay.”  Variable pay is used to “recognize and reward employee contribution toward company productivity, profitability, team work, safety, quality or some other metric deemed important.”  When it comes to variable pay, one size does not fit all.  Variable pay can take one of several forms, including the following:

• Incentive
• Profit sharing
• Bonus
• Holiday bonus
• Deferred compensation
• Cash
• Goods or services

Many organizations look to variable pay during uncertain economic environments. It is easier for employees to accept and understand a reward that is tailored to one’s personal performance and the organization’s overall performance, than to understand low or no salary increases. As such, many organizations in both the for profit and non-profit worlds have issued employees bonuses instead of annual salary increases in order to retain their top-performing workers.

The practice of variable pay has also fostered an increase in productivity. Employee engagement increases as workers become highly engaged in achieving goals to receive rewards. Employees take a larger role in the responsibility for their work outcome, which also drives commitment to the organization.

Some drawbacks related to variable pay can include execution. If a variable pay plan focuses on quantity, the end results can be a lack of quality. Tangible measurements become more valuable than innovative techniques or genuine customer satisfaction. While an increase in performance is always welcomed, if not careful a variable pay plan could result in outright cutthroat competition…thus ruining an organization’s cohesiveness.

As there are different forms of variable pay, every organization that wants to include it in their compensation mix must consider their individual circumstances. It is suggested that a task team should be appointed to consider variable pay as an option. When planning and designing the program this team should consider the following:

• Identify if more than one plan is needed based on employee groups,
• Identify plan participants,
• Determine how to encourage the entire organization to success through positive communication,
• Determine how the plan will be funded, and
• Determine the plan’s key aspects, weightings, and measurement methodologies.

Once a plan has been selected, thoroughly develop the modeling criteria, methodologies, and formulas. Create a document that outlines the plan, policies, and procedures. In non-profit organizations, ensure that the maximum potential payouts have been included in the organization’s budget to address the legal and tax considerations.  Conduct focus group sessions to determine if the plan is easily understood by employees, while paying close attention to the motivation the focus group members demonstrate. If needed, revise the plan based on the focus group results.  Ensure that focus group members understand that the payouts from the plan are at risk – not a guaranteed payment that employees can rely on to pay the mortgage or other critical bills. 

This task team and focus group approach should be revisited every few years.  Variable pay plans generally have a window of greatest effectiveness.  Once employees have achieved the targeted goals, it may be time to revisit the plan or eliminate it altogether. 

As with every new initiative in an organization, it’s important to have full cooperation with all of its members. In order for this to happen, clear communication must be made on the full details of the variable pay. All must be able to understand how this new system will work, how it will benefit them, and what is expected of them once the new pay variable plan goes into effect.

Are you considering introducing variable pay to your organization or updating an existing plan? Need some help getting started? Astron Solutions is here to help! We offer compensation consulting and can assist in introducing a variable pay plan through our cloud-based Talent Management system, FLARE™.  Please contact us today with any specific questions you’d like us to explore with you!

The Best of Jobs and the Worst of Jobs

Forbes and CareerBliss just released the data of their research looking into the happiest and unhappiest jobs in the world. A few observations from the list:

1. I am pretty shocked to see Real Estate Agent at number one. With the downturn in the housing market, the last job I expected to see on top would be one which is commission based on house purchases. But it is
2. 2 out of the top 3 occupations on the list are usually highly commission-based. In an era where base salaries aren't going up a lot, maybe that is where the money is being made and the happiness factor is the highest
3. Another commonality among the "happiest jobs"--a lot involve blue color jobs and quite a few involve some sort of IT/technology background.
4. 3 of the 7 most unhappy professions are in law. Again, why are people going to law school? 
5. It's not just law school that seems to be a mistake, 60% of the most unhappy professions usually require some sort of post-college degree. So while you're sitting in loads of debt, you're also miserable at your job? Pass!
6. I still think the best job ever was Tom Hanks in BIG testing toys:

 

More Reason Why Companies Should Care about DOMA Arguments

Listening to NPR yesterday, the coverage was heavily-centered around the two cases that are being tried before the Supreme Court--about Proposition 8 and the Defense of Marriage Act (DOMA). While there are people who feel strongly about the issue on both sides, the tide is turning towards people supporting marriage equality--not just in the general public and politics, but in the business world as well. And here are some reasons from NPR why you may want to follow this a bit more closely (hint: it's bad for business)

The Defense of Marriage Act prevents same-sex couples from getting medical coverage and other tax and retirement benefits that other employees receive for their spouses. And that complicates things for any business that employs people in any of the nine states and Washington, D.C., where same-sex couples are lawfully married.

"We're basically treating people differently," says Mark Roellig, general counsel at MassMutual Financial. He says DOMA forces his company to keep track of a dual system, and that costs time and money.

"You have to keep separate sets of books. You've got to continually be adjusting. And then also picking up the potential legal risk if you make a mistake," he says. "So it's ongoing administrative costs that are pretty significant."

His company does not want to discriminate, Roelling says. So MassMutual uses a workaround to give employees benefits for their same-sex spouses. But then DOMA forces those employees to pay more in taxes and MassMutual pays more, too.

Profit cuts are not the only reason businesses are complaining about the law — it's also about the work environment. Hannah Grove, executive vice president at State Street, a financial firm, says DOMA is hurting company's ability to create an inclusive atmosphere.

"In order to compete in today's global competitive environment, our employees are one of our greatest assets," Grove says...

...Overall, 278 employers signed on to oppose the Defense of Marriage Act. The number of companies that filed a brief arguing DOMA is good for business? Zero.

Just something to keep in mind...

Compensation 105: Pay Communications

Compensation Programs and Practices 2012, conducted by WorldatWork, found that 80 percent of organizations relay pay information to their employees via brief written or oral communications. This may leave us wondering, what would be the most effective way to communicate with an employee about his or her pay?  Is there just one right way to share this information? Are there legal considerations that impact pay communications? The focus for this issue of Astronology on compensation basics is Pay Communications.

Why is pay communication important? One Bloomberg BusinessWeek article explains that, “a pay-related communication from a manager has three times the impact on engagement, performance, and retention as that same communication coming from a central function such as HR.”  Pay communication is so critical, that how the information is relayed and by whom can impact an employee’s work contribution to the organization. The article also pointed out that only 10 percent of managers effectively communicate pay to their employees. While quite a few managers do not feel adequate in relaying pay information, these skills can be acquired through active learning training.

The human resources section of about.com mentions that if employees cannot fully understand the organization’s compensation philosophy, it is a sure sign that communication has been done poorly. Although a manager may not be responsible for selecting and establishing the pay philosophy, they do play a significant role in executing on that philosophy. Managers, in a nutshell, should be able to:

• Understand their roles and the value that they add when they communicate employee pay information.
• Understand the organization’s pay philosophy and be able to explain it clearly.
• Communicate the employee’s pay raise in such a manner that the employee feels rewarded and acknowledges that the organization values the employee.

One of the most effective ways to share compensation information is a formal meeting between an employee and his / her manager. Depending on the environment, or type of work done in an organization, e-mail or instant messaging may be popular choices in regular communication between workers. However, due to the sensitive nature of the subject of compensation, nothing demonstrates value more than a personable, one on one chat. It is said that 90 percent of how we communicate is through our nonverbal cues such as facial expressions and gestures. These nonverbal cues help in conveying sincerity to employees, particularly in delicate conversations surrounding pay.

Here are a few more Do’s and Don’ts when communicating pay:

• Don’t fail to communicate the context of a possible pay increase. If pay increases are awarded by merit and contribution, clearly define what would be considered merits and qualifying forms of contribution.
• Do explain why the employee may be receiving a pay raise. Be specific in his / her contributions.
• Don’t inform employees of the percentage of the increase. In an environment where nationally the pay increase is at an average of 2.5%-3.5%, in the eyes of the employee such an increase may not be motivating.
• Do give the employee the salary increase in a dollar amount.
• Don’t compare one employee’s increase to another’s employee’s increase.
• Do thank the employee for HIS / HER hard work and commitment, and express confidence in the employee’s continued contributions to the organization.
• Don’t focus on why the pay isn’t larger. Do confer with HR if the employee requests more information on why the pay isn’t larger. Be able to clearly explain what criteria were used to make the decision on the employee’s pay.
• Do follow up with HR with a written document to be included in the employee’s file regarding the amount of the increase.  In addition, a personal copy should be sent to the employee’s home address, or given to the employee in person.

With respect to this last “do,” in some cases there may be state laws that require not only verbal communication but also written communication of employee’s pay history. For instance, in 2011 New York introduced The Wage Theft Prevention ACT (WTPA), which requires that employers give written notices of wage rates to each new hire, all employees by February 1 of each new year, and any time an employee’s pay rate is changed.  Be sure to check your state laws for similar requirements, as what each notice must include may be different from state to state.

A comfortable time to have a conversation with an employee with respect to pay can be when the employee is first hired.  That initial conversation is only the starting point, however.  Such conversations must happen on an on-going basis, after the annual review with the employee.  The employee will be already anticipating the conversation, and such timing will facilitate both parties feeling comfortable to voice their opinions and also to be more openly heard.  In addition, the more information an employer shares with its employees regarding compensation philosophy and the reasons and criteria behind pay increase decisions on an on-going basis, higher levels of trust continue to build.  Such trust is essential for truly attracting, retaining, and motivating an organization’s human capital.

Ask the Expert: First-Time Manager

We got two excellent questions recently which spurred two awesome answer from Jennifer. Today's is about something that many people my age are going through: the anxiety that comes from being a manager for the first time and your responsibility to the people you are to manage. Here's the Q&A:
------------------------------

David Asks

I was recently made a real manager for the first time in my career but I'm a little nervous since I've never really been in charge of people before and I'm not sure what I'm doing is correct (there isn't much guidance from my company and the past inhabitants of this position weren't exactly role models of good managing skills). Is this something that people go into or are there courses that should be taught to managers to make sure they're doing the right thing? Or is there something I could suggest to my employer to do that may be beneficial not just for me but the whole company? I don't want to seem incompetent and unworthy of the new role but I also don't want to be a fish out of a water. Any advice?

Jennifer Answers

Congratulations on your promotion! How exciting for you! Managing employees can be one of the most rewarding aspects of work, and also one of the most challenging.

I am thrilled to see that you are proactively interested in developing your management skills. Many times, employers promote individuals who are technically savvy and experts in their positions, but lack the necessary skills to manage people. These individuals continue on for decades, not realizing their people skills could use some help! Your employees are lucky to have someone as caring as you for their manager.

Both Dale Carnegie Training (http://www.dalecarnegie.com/events/individuals/) and the American Management Association (http://www.amanet.org/training/seminars/management-and-supervisory-skills-training.aspx) offer courses designed to help managers – both new and seasoned – excel in their roles!

You could also ask your employer about providing you with a mentor, someone within the organization who you perceive to be an effective manager. You could learn from him / her at your pace, with less out of pocket cost than a formal training course. One on one coaching could also be another option if you organization has internal coaches available. You could even explore all three of these options – they’re not mutually exclusive!

Good luck with your new role! I hope you enjoy the professional development opportunities this growth position offers you.

Ask The Expert: Obligation to New Employer

I took a little while but we're now back to our "Ask the Expert Series", where our resident expert, Jennifer Loftus, answers your questions. Feel free to submit one and we will post the best of them here on the blog. The latest is about what happens when you get a new job...but a better one comes along?
------------------------------------------------------------

Anonymous asks 

I recently took a new job but at another company, a position that I interviewed for that's better overall (pay, location, benefits, etc.), said that they would get back to me next week--what is my obligation to my new employer to stay and is there any repercussions to my leaving? (I'm just trying to really figure out if there is a "good" way to handle this tough situation and be fair to the company that I just started at since I don't want to burn bridges)

Answer from Jennifer

Congratulations on being accepted at two positions! That is great for you, particularly in this economy! However, moving between jobs very quickly does pose challenges. On the one hand, you want to do what’s best for you and your career. On the other, you don’t want to do something that potentially could come back to haunt down the road.

Assuming that your job with your new employer is “at will,” meaning that you don’t have a contract for employment for a set period of time, there’s no legal obligation to stay. If you do have a contract, however, leaving before the contract is up could put you in a breach of contract situation.

Legal issues aside, you do have the ethical dilemma to address. Your employer has spent time interviewing, on-boarding, and training you. Those activities have cost the organization time and money. How would it feel to you to leave after only a few weeks? Would you feel comfortable with your decision to leave? Think carefully about your decision to accept the new position. While pay, benefits, and work location are important considerations, you must also reflect on the culture and work environment of the potential employer. Will you like working for this organization? Does the culture match your style? How do your current manager and your potential manager compare, in terms of work styles, expectations, and reputations? While more money is appealing to most people, many have found that a few less dollars in salary is worth the peace of mind that comes from working with a fair and pleasant manager in a supportive work culture.

If you have made the decision to leave, you still should give your two weeks’ notice, even though your employment has been relatively short. As for the reasons why you’re leaving, this is challenging. If the change in the commute is great, such as 20 minutes as opposed to two hours, focus on that. We’ve all known people who left positions because they didn’t realize how grueling the commute would be every day. If that’s not the case, is the job offer one that is for very different work than your current role? A change in career direction can also be an effective way to start the conversation. If neither of those options fits, however, you can be honest and say that the total compensation package is much larger than your current one, and to pass it up would be a disservice to your family.

No matter what reason you give for leaving, end the relationship on positive terms. Do you know someone who would be a good fit for the job? If yes, bring their resume to the meeting to demonstrate your support for your employer and not wanting to leave them in the lurch. Do your best to show that you care for your employer, even though you’ve been there only a short while. While the employer may not want to serve as a reference for you, the more you can do to help them get through this sudden transition, the less negatively they’ll view the bad news that you’re leaving.

Good luck with one of life’s hard conversations, and good luck with your new role!

2013 Survey of Human Resource Priorities

"Human resource management is responsible for how people are treated in organizations. It is responsible for bringing people into the organization, helping them perform their work, compensating them for their labors, and solving problems that arise."  
Cherrington, David J. (1995). The Management of Human Resources. Englewood Cliffs, NJ: Prentice-Hall. 

 Astron Solutions, LLC (www.astronsolutions.com) is reaching out to clients, associates, and colleagues to conduct a survey of 2013 Human Resource management priorities. The results of this short survey will be provided to participants free of charge, as part of our continued efforts to support HR professionals in the challenges they face on a daily basis. The results will provide you with a guide for setting strategic priorities and determining the allocation of limited HR resources. Thank you in advance for your participation.

 

Compensation 104: Pay for Performance

Continuing our series of compensation topics, this week’s Astronology will review the basics of Pay for Performance programs. About 71% of organizations have a formal employee performance appraisal system. Linking pay to performance through that appraisal system raises questions: How flexible can an employee performance appraisal system be? How can HR ensure that the performance appraisal system is fair? Does compensation link with performance appraisal score? Should it?

A pay for performance program is used to reward employees based on measurements of their performance through an appraisal system. These programs are heavily used in many industries, including healthcare. Pilot studies in some hospitals found using a pay for performance program led to an increase in efficiency.  Major concerns with pay for performance in the healthcare industry, however, are system validity, patient and physician autonomy / privacy, and the increase of administrative responsibility. Concerns regarding validity and workload can apply in other industries as well.  In addition, one must determine if the reward for high performance is an adjustment to an employee’s base pay, or an incentive or bonus reward.  While salary adjustments may have limited flexibility, in many industries, these “incentive-based compensation” or “bonus plans” are easily adaptable to meet a variety of needs.

Many organizations find pay for performance programs an answer to the complex problem of keeping up with a competitive market. Here are a few of the advantages of using pay for performance:

• Pay for performance makes it clear to the employee what areas should receive priority attention.

• Employees motivated by financial rewards are driven to achieve high levels of performance.

• The organization enjoys high performance from its staff and rewards such performers appropriately.

Given that the performance appraisal is linked to an employee’s pay, it is essential that the performance appraisal is fair.  The following are some aspects to consider when designing or updating a performance appraisal system used in a pay for performance program:

-The relative balance between the base salary and performance based pay: Many employees are willing to accept a below-market base salary if the incentive could add up to above market pay.

-How will the criteria be weighted?:  To over-reward employees for short-term accomplishments can be quite costly to an organization. It is important to clearly define what would be considered short-term versus long-term actions.

-How will the organization guard against score inflation or other manipulation?:  Manipulation of performance appraisal scores by raters and managers undermines the fairness of the employee appraisal and pay for performance systems.  Employees will perceive management as “gaming the system,” and the rewards become meaningless.  To guard against this demoralizing effect, Human Resources must continually review score results across departments and managers to identify scoring trends, and address score inflation or manipulation sooner rather than later.

-Will there be a partial incentive or reward if goals are partially achieved?: To have an “all or nothing” incentive or other reward can work for some industries, but not all. Establish at what rate rewards will be provided and what constitutes a “partial reward.”

-How will the criteria be established? How are the accomplishments measured?: Tapping into the expertise of an HR consulting firm is recommended when it comes to answering these questions. Utilizing an external third party enables the organization to explore the types of systems the competition uses, performance management trends, best practices, and pitfalls to avoid.  For example, Astron Solutions’ Web-Based Talent Management program, Flare™, combined with supportive consulting, has helped many organizations efficiently manage the challenges of creating and implementing a pay for performance program. Why not request a demonstration to learn more?

-Can we establish any of the rewards to be paid out on a discretionary basis?: Perhaps an employee may handle an unforeseen task so masterfully that those responsible for handling bonus awards or merit increase awards may deem it necessary to reward the employee outside the scope of the formal pay for performance program. Keep in mind, however, that it can be demotivating to have compensation based on unknown criteria. When using this type of discretionary plan, be discreet and make payout decisions wisely.

Pay for performance programs run contrary to the thought that performance should not be linked to compensation. This is especially so when one questions the structure of a pay for performance program. One person writing for the Harvard Business Review recently said, “When you try to institutionalize pay for performance you actually ruin the concept.” Others even question whether board members or HR professionals in an organization would know enough about what it takes – skill and difficulty – to perform at current levels.  As such, it is important to make sure when creating the pay for performance program design team that all sides or concerns are represented and considered. Examining the experience each team member has in areas such as compensation and management is critical.

When structured appropriately for the organization’s jobs and industry, pay for performance can provide multiple benefits to the employer.  Without careful development and on-going monitoring, however, the program may run contrary to the organization’s Human Resource goals.  Pay for performance is an important part of the compensation world that must be considered carefully by all organizations.

Working from Home Is the Wave of the Future

There are memos and then there are MEMOS like the one from Office Space about the TPS reports or the one sent by the Yahoo! CEO Marissa Myers (outed by AllThingsD) which banned working from home. There have been a myriad of reactions from the memo (mostly negative) and some of them are worth getting more into--and we'll do so right now.

Huffington Post (H/T Shira) wrote about why it's good for everything from the environment to the employee turnover and productivity. CNN wrote why this is a women's issue, followed up by TIME saying that is a men's issue as well. But the biggest thing of all is that Yahoo! is missing the point here, and missing the wave of the future according to Today:

By focusing more on measuring how well employees are doing their job, and worrying less about where the work gets done, companies with flexible work policies are seeing productivity go up, according to human resources experts. 

That may be one more reason American companies are adopting flexible work policies. As of last year, nearly two-thirds of employers offered flexible work rules to at least some of their employees – up from about a third in 2005, according to a national study by the Society for Human Resource Management. 

“We don’t see this trend going away,” said Michael Aitken, SHRM’s vice president of government affairs. "This is the way that work will get done in the future. I spend a great deal of time and energy in educating our members about the value that it offers.”

The key is the last part. Employers know about certain benefits of working from home (and the disadvantages of not allowing employees to take advantage of it), but it's the education of companies and those in charge of decisions like these that need to understand the pros and the cons. Not every type of job (and not every employee) will be able to work in this environment. But for the ones that are, the wave of the future is telecommuting and you better at least get educated about it before you get left behind.

(We'll discuss this more later in the week)

It's Casual Friday

From my favorite current hockey player in the latest of the string of my favorite commercials:


Have a great weekend!

Either Way, The End of a Long Week

Happy Friday! I had to work a full 5 days this week (ugh) but even for those who only worked 4 days, this probably seemed like a looooonnnnngggg week. Why? Well NBC's The Body Odd says it's because we as humans are used to a routine and once you change that up, it messes with our minds:

"If I had to venture a guess, I would say that it could be because four-day work weeks are much less common and are a deviation from the typical five-day work week," Marc Buehner, a psychologist at the U.K.'s Cardiff University who has studied the psychology of time perception, said in an email. "There are some laboratory studies that show that predictable events are perceived as shorter than unpredictable events."

The blog post is interesting because it talks about perception and how, as humans, when we get out of our routine, our perception gets messed up. That Monday routine got squashed because the week started on Tuesday and now you can't figure out what the heck is going on. So while you're bemoaning your 5 or 4 day work-week, imagine how long a 3-day work-week would have been and be glad--just kidding!

Have a great weekend!

Compensation 103: Salary Structures

An important part of compensation administration is the salary structure. According to Compensation Programs and Practices 2012, 85 percent of organizations have a formal salary structure in place. What are the pros and the cons of using a formal salary structure? What type of salary structures can be used to attract and retain talent?  How often should an organization update its salary structures?  How does HR know when it is time to create a brand new salary structure? These are essential questions we will answer in this issue of Astronology: Compensation 103: Salary Structures.

At its most basic, a salary structure is the manner in which an organization carries out its pay philosophy. As mentioned in our Compensation 101 and Compensation 102 articles, formal salary structures are used to create fairness among employees and protect an organization from possible federal law violations. Having a salary structure, however, is a commitment.  Organizations must keep the pay ranges up to date, or run the risk of paying non-competitive wages or being unable to attract new talent.

There are two leading types of salary structures that an organization can use: the Internal Equity Structure or the Market Pricing Structure.
 

Internal Equity Structure

The Internal Equity Structure is described as a salary structure that “examines positions and creates levels of pay, with large jumps in salary rates for the higher positions in the company and smaller jumps for lower-level jobs where promotions may not have so much effect.” In the Internal Equity Structure approach, the primary focus is on the value each job brings to the organization.  Organizations typically increase each grade’s midpoint salary range by 15% of the midpoint for the range below. Such ranges provide room for developing employee skills and an employee’s value within the organization. In addition, by using range maximums, the employer sets a limit for what the organization will pay for all jobs and levels.  Without an eye towards the external market, however, the Internal Equity Structure may not reflect current market pay rates.

 

The Market Pricing Structure

The Market Pricing Structure is quite simple.  The pay range for each job is tied to the market pay rate.  “Market” is defined by the region and industry of interest to the organization.  For some positions, the local market is relevant, while for others, a regional focus on industry specific competitors is pertinent.  Many organizations use this approach for developing salary ranges, as it is easy to understand and gives consideration to competitive pay.  

As a result of the external focus, the pay range structure determines which positions should be paid more than others, while reflecting yearly rate increase trends. For organizations with strong competition, this structure is ideal as it incorporates the compensation activities of targeted counterparts and what they may be paying employees in the same position.  The Market Pricing Structure is often used when organizations have employee retention concerns.

The Market Pricing Structure, however, does not place a primary emphasis on each position’s value to the organization.  Rather, the value and range placement reflects that of the external market.  As such, positions with a shortage of talent, or “hot” skills, may command a higher pay range than an organization would otherwise want to pay.

 

One or the Other?

While it seems that organizations will use either the Internal Equity Structure or the Market Pricing Structure, in reality most employers use a blend of the two.  “The majority of our clients use the Market Pricing Structure, while keeping an eye towards internal equity,” explains National Director Jennifer Loftus.  “An employer cannot focus strictly on the external or the internal, to the detriment of the other.  Employers who successfully attract and retain employees keep their eye on both distinct balls, and achieve balanced compromises in situations where the external and internal dictate widely differing grades and ranges.”

As mentioned in the previous Compensation 101 and 102 articles, an organization’s salary data, ranges, and structures should be reviewed at least once a year to ensure on-going effectiveness.  However, it is sometimes necessary to conduct interim reviews to ensure market competitiveness and internal equity.  What are some signs that your organization may need to change its salary structure?  Employee dissatisfaction can be an indicator. Astron Solutions offers a variety of options in employee satisfaction surveys that allow organizations to obtain employees’ feelings in regards to their employment. Designing a survey to address organizational compensation issues can be used to determine whether your organization may be in need of adjustment.  In addition, an inability to hire and / or retain employees can also indicate the need to review an organization’s salary structures.  While other factors such as work conditions, location, and managerial style may be driving recruitment and retention issues, it is important to first review the compensation structure to ensure it is not creating these employee challenges.

When was the last time your organization reviewed its salary structures?  With spring right around the corner, now is a great time for a compensation tune up!  Contact Astron Solutions today for a free consultation to learn more, and enjoy a more effective 2013.

Happy President's Day (and a return to Baseball)

I wanted to wish everyone a very Happy President's Day to all of our readers from everyone here at Astron. If you're not a lucky one who has off today (I am one of the unlucky), then take solace is this: President's Day means that the start of baseball is right around the corner. Before the next major holidays, we'll have Spring Training Games, the World Baseball Classic, and, yes, Opening Day.

Baseball season reminds me of this Forbes article I read back in the fall. It talked about Joe Girardi's leadership while battling both personal and professional adversity. As the article wrote about Girardi in mid-October:

Girardi’s recent achievements are probably some of his finest as a manager. Besides winning his third American League East title and narrowly defeating a tenacious Baltimore Orioles ball club during the regular season and in the American League Division Series, he accomplished these amazing feats with a heavy heart. Girardi’s father had passed away of Alzheimer’s disease on October 6th and kept the matter private until an obituary was going to run in a local paper back in his home state of Illinois. As Girardi was being peppered with questions regarding Alex Rodriguez’s performance and the Yankees’ chances of success in the postseason, he compartmentalized his numerous tasks and didn’t let a personal tragedy affect his job. Girardi put the needs of the ball club in front of his own anguish and grieving.

This is not meaning that this solution is right for everyone but as a leader of a ballclub, an organization or even a small group, the key is to always find a way to provide an example for other employees--especially in the face of adversity. There is a lot to be said for people who lead through good times, but the best leaders are the ones who are able to navigate the tough times and still come out on top. And although the Yankees didn't win the World Series last year, Girardi's leadership in the face of the tough time the team faced, while not always perfect, was a big reason they got as close as they did.

Guest Post: My First Experiences with HR

The guest posts roll on this week with Michelle's post about her first experiences in HR--and how they reminded her that the interviewing process is very similar to the dating process. Without further ado, here is what Michelle had to say:
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So I was thinking back to one of my first experiences with Human Resources and it was when i was trying to get my job secured while i was still in college. I was in touch with the HR director of the agency that I worked for right after college but I remember how hard it was to reach her and to get a definitive answer. I had all my interviews (traveled to New York City and back to Boston all in one day to get them all done) and followed through with HR every week or so to see if there was any confirmation of my hire. I would usually get her voicemail and not receive a call back for a few days. When I did hear back, she would always say something like "we're still in the process of finalizing your position"

After a while I got incredibly frustrated (I really wanted to have my job in place before I graduated). I felt like i was being strung along and i also remember feeling like "why would i want to work for an agency that can't get their act together?"

In other words, I felt that her lack of a definitive answer for so long reflected poorly on the agency. And I also felt like because she was the only person from the agency that i was in communication with, I remember feeling like she was the person who represented the company.  In other words, she embodied the company.

I guess what I'm trying to say is that before you start working somewhere, the HR person is inevitably the only person you get to communicate with. That's why it's important for them to be in open dialogue about your job's status etc, because in the end, you get an impression of the company based on the only person that you are in communication with. Had this HR director handled my job status better, I would not have started having doubts about the agency as a whole.

I was thinking it could be good advice to HR managers when they realize that they are the face to the company for someone who is applying and it is therefore important to handle/manage expectations properly during the whole interview/hiring process. If the manager is hard to get a hold of or they are not sharing concrete information, it can make you feel like the company as a whole is not some place that you would want to work at.

Also, this fits with my whole theory about how applying for a job and interviewing at a company can feel like dating--did the recruiter/HR person like you during the interview (analogy: first date)? will they call you back for a 2nd interview (analogy: second date)? There are so many similarities: from the way you dress to make a good first impression to the thank you (kind of like after a date you write a "thank you" text saying you had a good time and you hope to see the person again). A bad first impression, though, can be a long way to saying "no thanks" to both a prospective job and a prospective relationship.

Guest Post: Making a Final Decision without Facetime

The story by Alaine on Monday has inspired me to reach out to friends in order to find out more about what is really going on during the job search process and for 20-somethings who are out in the working world. One friend (who wished to remain anonymous) had two stories to tell. Here was his first:
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I had a final round interview on the phone for a company after having the first round on the phone. The firm was in New York but the partner was located in London so it was necessary to do this by phone. There was never a chance for facetime so I had the full one-hour interview. I was told there was one position with about ten candidates.

I received feedback from the hiring manager who told me I was a runner-up for the position but unfortunately, did not get the role. It was quite frustrating and difficult to not have the chance to interact, especially for a job with such high stakes.
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Thanks to the friend for sharing that. What he shared here seems to be too typical of companies today who have too little time and money for interviewing. Too often candidates get through a rigorous process only to have their candidacy determined in an impersonal way (and a way that really doesn't allow for a true evaluation of talents). Not only was this a bad way of going about things for him, but it's hard to imagine that it's a good idea from a company perspective to hire someone that they've never met before in person (anyone who follows the Manti Te'o controversy knows that the phone is not the best way to determine someone's validity). This friend is now employed at another company so it didn't stop him from finding a job in general but this job left him wondering "what if..."

Ask The Expert: Underperforming and Trying to Climb the Ladder

We've got some great questions for the "Ask The Expert" series so far, so please keep them coming. If you have a question, you can contact Jennifer or myself under our "Contact Us" tab on the top of the page. We look forward to hearing your questions (and getting you answers!). This one comes from an anonymous source who says "this is sort of an emergency--can I get a response by Wednesday???" Well we're a day early, anonymous, and here is what Jennifer had to say:
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Question from Anonymous

What do you do with an employee who requests more responsibility/promotion but you feel that they aren't going to do any better than the job they are currently preforming?

Answer from Jennifer

Wow, the situation you’ve described is a delicate one.  On the one hand, you want to celebrate the initiative that the employee has taken in requesting additional duties and responsibilities.  On the other, it appears that the employee currently has some performance deficiencies that need to be enhanced first before promotions can be discussed.

Thank the employee for taking the initiative to approach you, and explore why he / she chose to do so at this time.  In that exploration, you may find out the root cause, such as too many years in the same job, a desire to earn more money, pressure from home to have a job with a “better” title, or taking a cue from a friend who recently did the same.  That root cause can inform your response. 

If that exploration does not yield any actionable information, however, you will need to take a different approach.  Find out before your meeting with the employee your organization’s policy on promotions.  Can they happen at any time during the year, or only when annual performance appraisals are being conducted?  Does an incumbent need to be in the job a certain amount of time, such as one or two years, before being considered for a promotion?  Your employer’s policy may hold the answer you seek for the conversation.

If neither of these approaches work, however, you’ll have to be honest and upfront about why a promotion isn’t a possibility at this time.  For example, if work output is a consideration, explicitly outlining for the employee the necessary promotional criteria will be helpful: “John, I appreciate your interest in and enthusiasm regarding growth opportunities here at Company XYZ!  All our employees in position X [produce Y widgets per hour / successfully manage at least Z client engagements / have employee turnover below A%].  We need to help you develop your skills in this area.  Let’s jointly identify some specific goals for you to accomplish and training opportunities to take advantage of in the next 6 months to get you on a potential track for promotional consideration.”  The position’s job description may also have promotional criteria included which can help in this discussion.

You know the employee and the organizational culture best – what I’ve described here may be effective, or may need some wordsmithing to make the situation an eventual win-win for all.   Also remember that you must watch your language to not include any promotional job guarantees.  If the employee misconstrues what you say, they may think an oral contract was created during the meeting, which creates a different set of issues to deal with down the road!

Good luck!  Please let us know how the conversation goes.

Compensation 102: Job Evaluation

The importance of job evaluation is simple. In order to create a competitive yet equitable compensation system, organizations need clear job classifications.  There are also federal laws to take into consideration when designing compensation systems.  Title VII of the Civil Rights Act prohibits employment discrimination based on race, color, religion, sex, or national origin.  The Equal Pay Act protects men and women who perform equal work in the same establishment from sex-based pay discrimination.  The Age Discrimination in Employment Act defends the working rights of individuals 40 years of age or older.  Job evaluation is essential for organizations to be in compliance with these laws.  In short, job evaluation evens out possible wage wrinkles. It also helps to creates clear guidelines for an organization to follow with respect to employees’ wages. This week’s Astronology discusses the importance of job evaluation and the four primary evaluation methods.

The Objective of Job Evaluation

The purpose of conducting job evaluation is to fairly determine the monetary value / worth of a job in relation to other jobs in an organization.  It’s the bridging gap between the relative worth of a position to the organization and the pay range structure into which the position falls. The thought of having to review every job position in an organization can be daunting, especially if the organization is large. Fortunately, this is not always necessary.  Select the key job positions, positions that address or cover the type of work essentially performed in each department.  Using job evaluation results, one can develop appropriate salary grades and decide on other compensation issues. Job evaluation can also help clarify job descriptions that could be used in determining performance standards and creating performance appraisal systems.

It’s imperative that job evaluations are reviewed periodically. Work conditions change over time. For instance, technology advances and new services to benefit the organization become available, potentially changing a position’s grade level or even eliminating certain job requirements / positions.  But where to start!  There are four job evaluation methods to consider, which we will explore here.
 

The Ranking Method

Considered the simplest job evaluation method, in the Ranking method jobs are listed from highest to lowest value / merit in relation to the organization. This listing can also be done according to level of difficulty in job performance. In this method, jobs are examined as a whole.

This method is highly subjective, which could result in upset employees and low job morale among employees with lower job rankings. This morale impact can be detrimental to an organization’s culture.  The ranking method, however is more time and cost efficient than other job evaluation methods.  The ranking method is often appropriate for smaller organizations, or those with only a few jobs to evaluate.
 

The Classification Method

Guest Post: Lessons In Job Hunting

Hope everyone is recovered from Super Bowl Sunday (should I say "got their power back"?). We're back today with a great guest post from a friend who writes about what it's like from the perspective of a job searcher. It's not an easy time to be looking for a job but she has some good lessons from her experiences. Without further ado, I kick it over to Alaine:
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I have learned a lot about looking for a job through my five months of job searching. This is particularly true now when many employers are not hiring (or not hiring as much) and there is a LOT of competition for jobs. Also, I will admit--I’ve been a little picky in my search- I have a master’s degree and prior work experience, so I feel like I can do that. I’m looking for a job that I will enjoy and want to go to everyday, not simply JUST a job.  Here are a few things I’ve learned through my search:

The most important lesson I’ve learned is the value of networking; It’s literally the only way to get a job these days. There is so much competition, employers are receiving hundreds of resumes, and it’s hard to distinguish oneself on paper. The best thing to do is to know someone at the company- they can make a recommendation to HR or give you the inside scoop on how to apply, which is a million times more valuable than being another paper in a stack of resumes.

Don’t waste your time on online job applications.  Searching for and applying for jobs online can take hours- don’t waste your time! It may be useful for someone looking for an “Administrative Assistant” type of position but not for a more specific position, especially if you have an advanced degree and want to be picky. Employers receive boatloads of these – they’re impersonal and you’ll have a much better chance if you actually know someone at the company or at least have had an informational interview with them.

Networking isn’t only about schmoozing at industry events or conferences: informational interviews are perhaps the best way to expand your professional network and make solid connections. Talk to everyone that you can who might be related to the field you’re looking to work in. Use your existing networks of fellow alumni, professors, family and friends. An informational interview is a great way to get your name out there and also to learn more about the field, specific companies, and specific types of positions- it can be very helpful to guide your search.

Be proactive about meeting people and finding positions. Investigate the companies and organizations that you want to work for. Who are the big companies in your field? Who are the up-and-comers? Find out their main business operations and which employees seem to run the show. Has the company put out any press releases, or been mentioned in any articles? Try to find someone at the company to reach out to for an informational interview to find out more about a certain sector, position, or business operation. If you can, use your existing networks to make a connection at the company- LinkedIn is great for that!

Keep up with industry news and events. You never know who will show up at these things- it could be your next employer! Even if you don’t make a good connection at an event, it’s a great talking point at a future interview.

You never know who knows who or what can lead to what. Your best bet is to put yourself out there, meet as many people as you can, and stay on top of industry news and events for good talking points.