Expecting Unicorn Talent on a Hobby Horse Budget
Strategies and Pitfalls in the Quest for Budget-Friendly Talent Excellence
A survey of 600 C-Suite executives showed that 54% expect leadership to be more challenging in 2024. Any guess what the “top challenge” to leadership might be?
(Psst… I’ll give you a hint… look at the title of this article 😉)
According to the survey “Changing worker expectations: This includes compensation and culture.” If you know anything about us at CultureStoke, we are all about culture, but what do compensation and culture have to do with one another? A lot.
Your culture is the culmination of your organization's acceptable and unacceptable behaviors. What is the typical, expected, and, therefore, acceptable behavior regarding compensation in traditional workplaces? Trying to get the most talent for the least amount of compensation. What behavior has this taught the people? Look for who is going to pay you the most. This, on its surface, may not appear problematic (it is), but I want to add a layer on top of this to paint a different picture.
Most organizational compensation models are predicated on the market—what is everyone else paying for this type of work?
This is akin to how gas stations determine how much to charge for gas, leading to consumers' inevitable price shopping when deciding when to fill the tank. It is not unlike how most employees are trained to look for employment. It is the basis for the transactional nature of the typical workplace. Everyone knows this is happening and couches it as a “negotiation.” Then something interesting happens: organizations and their leaders expect ever-increasing performance.
I spoke with someone at a conference years ago, and they were lamenting the plight of not getting their people to “perform.” When I asked them to tell me more, they told me how their people kept expecting more and more money. When I asked if they were asking more from their team, they looked at me like I was crazy. “Of course! Taking on more responsibility is part of growing in their role.” When I asked if they were paying them more, they looked at me like I was even crazier. I might be a little crazy. What is even crazier is that we have created a system where people are hired to do a job (a defined set of tasks) for an agreed-upon compensation package, only to add more things to their plate and get indignant when they ask for more money.
Therein lies the pitfalls of this type of system, which treats the employee-employer relationship as transactional. During salary negotiations, organizations set the stage for trying to get the most talent for the least amount of compensation. They don’t realize that they are also setting a culture of doing the least amount for the most compensation.
The employee-employer relationship should not be transactional. Treating it that way creates problems for leaders and their organizations. The relationship should be relational.
So what can we do about this? How do we “change worker expectations?” Below are three tips to improve your people’s lives and make your organization more profitable.
1. Don’t try to change their expectations; change the discussion.
Instead of posting “salary commensurate with experience” or something like that, be clear about what the position you are hiring for is valued at (min/max salary range) and your anticipated hiring salary (what you expect to pay for this position specifically). Use something like this for your job: "This valued position in our organization makes anywhere between $85,000-$95,000 annually. We are looking to hire someone looking for $88,000-$90,000 annually to start with explicit salary bumps based on added responsibilities and/or experience.”
Don’t make it a negotiation from jump where you are playing a game of chicken to see who will blink first. Just be clear about what you are willing to pay for the role as it stands currently and what you expect to pay for the role as it grows within your organization. This approach will accomplish a few things. First, you will attract people who know what they need/want to do doing the work you’re asking. If they ask for something beyond your anticipated hiring range, make them sell you on it - you might be surprised and give it to them, or you may know that they are not the right fit based on your needs.
Second, you are not starting the relationship off on a combative foot. Instead you are setting the tone of clear expectations and transparent communication. Lastly, it is an opening conversation for career development, which requires you to be most thoughtful about what skills, knowledge, and abilities you need to demonstrate to achieve higher compensation. Instead of waiting for them to ask for a raise and start the whole negotiation dance all over again, you have defined and objective things in place where they can demonstrate increased value.
Bottom Line: Don’t make it a negotiation; make it a choice.
2. Get creative when it comes to compensation. When salary is the only tool you think you must work with, every problem will look like a nail. Money is essential, and it will always be an issue if you do not pay people enough for them to live. But, how much to pay your people is another article on another day. Compensation is more than just money. Humans have a lot more needs than just financial (again, super important, but not everything). Let’s look at Phycology 101 Maslow’s Hierarchy of Needs!
If we spend a third of our lives at work, our workplaces need to provide us with more than just the bottom two layers of the hierarchy. Here are a couple of ideas for each layer that can be included in a compensation package.
Love and Belonging: You can enable your people to create clubs/communities that meet during and after work hours where people with shared interests and connections can be a fantastic addition to a compensation package. “Once a month, we have employee resource groups (ERGs) and clubs that meet during and after work hours to connect and share their interests!” Talk about a competitive advantage that costs little to nothing but adds a ton!
Esteem: Freedom. What is the one thing we all share, have a finite amount, and always wish we had more? Time! The amount of freedom we have in our lives is directly tied to our free time. If you can give people more time, you’re giving them more than money. You’re giving them more life! Imagine if you could get your car serviced or do your laundry while working. Imagine if you had an arrangement where a local mechanic would do routine services in the parking lot. Or, had a system setup with a local laundromat where they would pick up dirty clothes in the morning once a week and drop off cleaned and folded clothes at the end of the day? I am not saying you would have to pay for it; just facilitate it so you can help one of your people check something off their list they would have typically had to take time off or do after hours. Who would not sign up for that?!
Self-Actualization: This is a goal of every organization. To be not only a source of income but also a source of fulfillment. You could (read: should) offer company gym memberships and/or wellness programs. The ROI for healthy people is tremendous! (Go do some research on productivity when people are physically well.) Tuition reimbursement programs are unique. As a beneficiary of such a program, I can tell you wholeheartedly that I would not be where I am today without one. The support provided by an organization that helped me go from zero college to graduate school has provided me with a life I would have never dreamed of. Below are some other recommended practices:
Career Development Plans: Create personalized career development plans for employees, helping them set and achieve their professional goals.
Career Development Funds: Employees can use these funds to advance their skills through courses, certifications, and workshops.
Mentorship Programs: Include access to company-sponsored mentorship opportunities within the compensation package.
Flexible Work Arrangements: Offer options for remote work, flexible hours, or compressed workweeks
Recognition and Rewards: Implement a system of bonuses, awards, or other incentives to acknowledge employee achievements regularly.
Leadership Training: Offer company-funded leadership development programs to help employees prepare for future leadership roles.
Innovation Labs: Provide opportunities for employees to work on innovative projects through designated time or funding.
Community Involvement: Offer paid volunteer days or matching donation programs to encourage community service and involvement.
Bottom Line: If you make it about tasks for money, the more you expect from them (tasks), the more they will expect from you (money). If you make it about your investment in them while they do the work, they will do whatever you ask.
3. Stop looking at your people as your greatest expense. Look at them as your most valuable resource.
When employees feel valued and supported, they’re more motivated, productive, and loyal, which means less turnover and lower hiring costs. Investing in their growth and well-being helps build a skilled and engaged team that drives innovation and keeps customers happy. When employees feel appreciated, morale gets a big boost, teamwork flourishes, and everyone’s up for continuous improvement. This fresh perspective leads to smarter decisions, more efficiency, and bigger profits. Treating employees as assets creates a positive culture that attracts top talent and gives companies a real edge in the market.
As we wrap up this edition, let’s talk about why it’s time to change how we view and compensate our people. Recognizing employees as our biggest assets and investing in their growth and well-being can lead to a more motivated, productive, and loyal workforce. This shift can drive innovation, boost customer satisfaction, and create a culture of collaboration and continuous improvement. Happier employees mean fewer Monday blues and more high-fives all around! These benefits lead to smarter decisions, increased efficiency, and a healthier bottom line. Let’s embrace this new perspective and create a positive, thriving workplace where both the company and its people can reach new heights.
Here’s to a brighter, more prosperous future for everyone—complete with extra coffee breaks and spontaneous dance parties!
This edition of the Monthly Stoke
is authored by Wes Love
