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    Entries in career (121)


    Fondly remembering the days of 3% raises

    Quick shot for a busy Tuesday - check out this piece that ran on USA Today online over the weekend - Is the annual pay raise dead?, a look at some recent studies and trends in the world of employee compensation.

    For what seems like ages, once per year the big total rewards consultancies like Towers Watson or Aon Hewitt would diligently report back that for the average employee annual salary increases would be about 3% (again). The news that annual salary increases would be about 3% became somewhat of a running joke, since it was so consistent and predictable. The phrase of employees being '3-percented until retirement' was fairly common.

    Well, if the latest news on annual salary increases is accurate, we may all look back on the 3% raises of the past and wonder what happened to them. Check out some of the comments in the above-mentioned USA Today piece:

    "Base salary increases are flat. We don't see the prospect of that changing much at all in the next several years," said Ken Abosch, who studies compensation issues for Aon Hewitt.

    In other words, the annual raise is dead. It was already on life support last decade, but the Great Recession has finished off the raise. It's been replaced by "variable compensation" — the bonus.

    "The quiet revolution has been the change in compensation mix," Abosch said. "Through a series of recessions, organizations have pulled back dramatically on fixed costs. And base salaries are often a company's most significant fixed cost ... [They] have a compounding effect, and create a drag on an organization's ability to change."

    Awesome isn't it when your salary, (and by extension, you), are described and probably considered as 'a drag on an organization's ability to change', instead of, I don't know, a strategic investment of organizational resources in order to hire and retain great people.

    One of the effects of a relatively higher percentage of one's overall compensation being shifted towards bonuses or other kinds of variable pay is that it makes 'regular' employment look and feel more like contingent labor. One of the reasons people like 'regular' jobs is the 'regular' nature of their weekly, monthly, and annual earnings. Drive more of these earnings into more company-friendly (and easier to reduce and/or eliminate), irregular compensation, then, well, earnings stability becomes much more tenuous.

    Companies need to be more agile and flexible these days, no doubt. But at least in the US they have had the benefit of pretty much universal employment-at-will arrangements to ensure labor and labor cost flexibility. Now it seems like that might not be flexible enough for many organizations.

    They want your 3% as well.


    It's going to keep getting harder for traditional workplaces and policies

    Last week I wrote about the six-hour workday, and experiment that some companies and public sector organizations have been running in Sweden (and some other places), that is designed to reduce employee stress, improve work/life balance, and improve employee engagement and retention. And the six-hour workday comes with the side benefit of helping employees stay more focused on their work while reducing unnecessary distractions.

    So far, in limited experiments, the six-hour workday is proving to be pretty effective at moving the needle in a positive direction on some of HR and talent pros most intractable challenges - engagement, retention, and employer brand. Despite all this, will the six-hour workday catch in here in the USA in any noticeable way?

    Maybe not. 

    Or perhaps the answer is maybe not yet.

    'Radical' new ideas are only radical until they hit a tipping point when they have reached just enough adoption, and from a few influential organizations, and suddenly candidates are asking your recruiters about whether or not you have six-hour days or have eliminated annual performance reviews or have implemented an unlimited vacation policy.

    I just caught this piece about LinkedIn, and their recent decision to adopt an unlimited vacation policy for their employees. While LinkedIn is certainly not the first organization to trash the traditional PTO process in favor of one where employees and managers figure it out for themselves, they might be one of the largest, with about 9,000 employees worldwide. LinkedIn has likely many motivations that drove the decision to scrap the 'three weeks vacation after 5 years of service' nonsense that probably 97% of organizations use to award and track time off for their employees, but my guess would be the primary ones would be for recruiting and retention.

    Likely there are dozens of Silicon Valley startups that have not bothered to worry about setting up traditional PTO plans at all that are competing with LinkedIn for talent. Just think about the difference in these two sentences in the point of view of a talented tech candidate:

    1 You will accrue 4.25 hours of paid vacation every bi-weekly pay period, maxing at 80 hours until you reach 5 years of service, when the accrual maximum increases to 120 hours'

    2. 'You take as much vacation as you want. Work it out with your manager and team.'

    Don't bother telling me in the comments that people don't actually take as much vacation when it is 'unlimited' as they do when their is a set PTO policy and schedule. That doesn't matter one bit to the candidate, or anyone else really.

    What matters is that when you can't match (and sometimes you do have great reasons why you can't), more innovative, modern, and employee-friendly policies and perks you are going to be always at a competitive disadvantage.

    Once these innovations and perks make that important shift to become 'expectations' you had better have a decent rebuttal to candidates and employees who won't understand why they suddenly have to start worrying about having enough accrued hours of PTO in order to take that long weekend they deserve after pulling 70 hour weeks for two months to meet the last big ship date. 

    It is only a matter of time, if it has not happened yet, when one of your hiring managers comes back to you in HR and asks 'Why can't we have unlimited PTO?, the talent we need expects it.'

    Have a great week!


    Should you ask for a 1200% raise?

    Hey it's October!  The best month of the year by far. If you don't believe me, check out Months, ranked and get up to speed.

    So happy October. 

    Hey question for you career-minded folks or for those of you who might sit on the other side of the compensation table, making decisions about comp offers, raises, and bonuses for your teams.

    Should you (or anyone) ever have the gumption to ask for a 1200% raise?

    Sounds kind of ridiculous in the land of 3% annual salary increases, (maybe 4% if you are a 'top performer'), and with organizations continuing to do everything they can to resist the inevitable upward pressure on wages that an improving economy with falling unemployment will drive.

    But 1200% of a pop? You would have to be really confident to make that kind of a salary demand.

    Why is that particular figure on my mind?

    From reading recent piece on Business Insider, Vikings part ways with their mascot after he demanded a 1200% raise.

    From the piece:

    Ragnar, the Vikings' unofficial mascot, and his motorcycle have been a fixture at Minnesota Vikings games for over two decades, but that appears to be over as the two sides have been unable to reach an agreement on a new contract.

    Ragnar, whose real name is Joe Juranitch, was seeking a new contract that would pay him $20,000 per game, according to Michael Rand of the Star Tribune. That would translate to an annual salary of $200,000 for eight regular season and two preseason games, and an increase of more than 1,200% from his previous pay of "about $1,500 per game" last season.

    I have never been to a Vikings home game, so I am really not too sure what exactly Ragnar brought to the table, and particularly what he thought would be worth about $5,000/hour (game lasts about 3 hours, add 1 hour for pre and post game work). But it is pretty clear from the way the Vikings basically responded to this demand with a 'Thanks Ragnar, it's been really nice working with you. Good luck!' that Ragnar had severely overestimated his value and his leverage.

    What can us normals take away from this little viking adventure, even if we are just trying to secure a reasonable bump, say 10% or so?

    1. Have some idea of how much actual value, (revenue, increased customer retention, tangible cost savings, etc.), we are directly responsible for creating. 

    2. Have some idea how painful it would be to the company if we actually walked out when our crazy demands were not met.

    3. Have some idea of the market more generally for folks who do what we do.

    Our pal Ragnar pretty much failed on all accounts. He likely did not generate any appreciable revenue for the team. Even though his Facebook page was full of comments from fans expressing support and anger towards the team, it would take an enormous stretch of believability to conclude that any actual fans would refuse to attend games due to his absence. 

    He also didn't really grasp that the games would carry on pretty much unaffected once he was no longer a part of the show. The team preparation certainly would not be affected. His absence actually would create less work not more for the game day operations staff. In fact, other than the small number of fans who missed his performance at the game, everyone else lives got a little bit easier.

    Finally, there is almost no chance that Ragnar surveyed the landscape of professional sports mascots to come up with market comparables that led him to make a $20K per game demand. If team mascots were really pulling down anywhere near that kind of scratch, there would be line hundreds of people long to try out for those gigs. More than likely, one of Ragnar's buddies got into his head that he was somehow underpaid and under appreciated, (and that he was WAY more important to the product than he was).

    Look, I get wanting to make every last dollar you can. We are probably all underpaid for the amount of crap we have to put up with. But the key question is knowing just how much you are really underpaid, and making sure you are honest about your value, how replaceable you are, and your ego.

    Happy October.


    Need to fill a technical job? It helps if you are in one of these four cities

    Some really interesting and detailed data on jobs, job seekers, employment opportunities and the interplay among all the moving parts of the recruiting game in the recently released report from Indeed titled Beyond the Talent Shortage: How Tech Candidates Search for Jobs.

    There is plenty of fascinating information in the report, but the one element I wanted to call out was the really pronounced and increasing preference by tech candidates for only four popular work locations - San Jose, San Francisco, Seattle, and Austin. According to the Indeed report, "In 2013, interest in the 18 software-related jobs we analyzed was 3.3 times greater in San Jose, San Francisco, Seattle, and Austin than in the US on average. In 2015, interest in those cities was 3.6 times greater."

    The below chart from Indeed shows how these job seeker preferences for the 'Big 4' tech hubs compared to the US overall have increased over time:

    So the Indeed data just puts some numbers behind what you have probably known for some time - if you are recruting technical talent and are not located in one of these Big 4 hubs, you're likely entering the competition already in a losing position. The Indeed data shows that while cities all across the US, heck, all over the world, are seeing increases in open technical jobs, that tech candidates are only honing in their efforts more on the Big 4 tech hubs.

    So while in the past, and especially in times of recession, candidate interest would have been primarily driven by the availability of jobs, the increasing candidate interest in these 4 tech hubs suggests further concentration on the part of job seekers on these locales. 

    What can/should you be doing if indeed, (pardon the pun), you have difficult technical jobs to fill and you are not located in one of the Big 4 tech hubs? The analysis from Indeed offers a few decent suggestions:

    1. Get yourself to one of the Big 4 citiies. This is the 'fish where the fish are' strategy, and of course it is easier said than done. But if these trends continue on their recent trajectory, it is only going to become more challenging to recruit tech talent to non Big 4 locations. It might be worth setting up a small, satellite office in one of these sought-after locations when compared to the opportunity cost of having important roles remain empty.

    2. Let go of your 'Everyone needs to be physically at HQ' policy. Organizations have seemingly gone around and around on the value/importance of having everyone on the team physically co-located versus embracing more flexible work arrangements. And I suspect these conversations and shifts in attitude will continue to go on pretty much forever. But if the talent you need has decided they (mostly) would rather be in Seattle or San Jose and you are in Pennsyltucky then you might have to make some kind of a compromise.

    3. Figure out how to better 'sell' what your location does have to offer to candidates that generally prefer the big Tech hubs. A while back I wrote a post about 'selling' your non-glamourous city to candidates, and the things i touched upon then I think are more or less still true now. The Big 4 cities may have a lot to offer candidates, but (hopefully) your city does too. And it might also be time to take a cue from politics once in a while and go negative - those Big 4 tech hubs are not all wonderful, and your city might have the edge in things like cost of living, open space, even the presence of 'winter', which I am told some people enjoy.

    There is plenty more interesting information in the Indeed report - take some time to look it over if you are at all interested on what their data shows and suggests about the market for technical talent.

    Have a great weekend!


    Remember Harvard Graphics?

    I saw this clever post yesterday, titled Computer Science Courses That Don't Exist But Should, and one suggested course in particular really stood out:

    CSCI 3300: Classical Software Studies

    Discuss and dissect historically significant products, including VisiCalc, AppleWorks, Robot Odyssey, Zork, and MacPaint. Emphases are on user interface and creativity fostered by hardware limitations.

    While I am not nearly geeky enough to know all of those old products, (the only one I recognize is VisiCalc, and I never even used that), it made me think back on my introduction to software and workplace technology more generally.Pretty slick UI, right?

    And the one 'classic' piece of workplace tech that I remember most fondly, for reasons I will share in a second, is Harvard Graphics, the first general use charting and data visualization tool to gain acceptance in the office. In the late 80s and maybe a little into the early 90s, Harvard Graphics was the go-to tool for creating at that time were really amazing bar, pie, line, and other types of charts that today we would just laugh at for their simplicity. But pretty soon Microsoft Office took over the office, and Harcard Graphics pretty quickly fell out of fashion.

    But I loved my time with Harvard Graphics. Back in the day, when the first colorful stacked bar chart of regional sales broken out for the last 4 quarters emerged from the plotter, (look that one up, kids), and I marched it in to the CFO's office, suddenly I was looked at not like the 22-year-old kid who knew nothing, but as the 22-year-old kid who created something cool.

    After getting a glimpse of what the HG program could do, the CFO started setting me off to make more and different kinds of graphical representations of our financials that would be used in exec meetings, sent out to the regional presidents, and often tacked up on the wall in the CEO's office. No one would ever tack a boring looking income statement on their wall, but a 3-D multi-colored bar chart of gross profit margin by product segment? That was high art to some of these guys, and I was the only person in the office, (probably because I could not add much value anywhere else), that was able at that time to produce these charts.

    That simple little program, and the rest of the office's reluctance to embrace anything new or seemingly complicated, helped me cement a reputation as someone clever, useful, and for being what then passed for technically savvy - which make no mistake helped out your career as much back in those days as it does today.

    Harvard Graphics got me at least two raises I am pretty sure.

    Ok, the walk down memory lane is over. Have a great weekend and think about this little tale the next time some new and scary and complicated technology shows up in the office.

    It just might be the one that gets your work tacked up on the CEO's wall.