Every time I go to a conference, I wear layers because the rooms are either too cold or too hot. I’m sure I am not the only one mentioning this on the feedback form that the organizer receives after the conference.

It is one of the reasons why I like working from home. I can make my office as warm or cool as I want without impacting anyone else except my dog. And Cody’s good at getting up and leaving the room if he’s not comfortable.

Pay should be “just right.” Not too much and not too little. Just like the temperature in a room.

But getting it “just right” is a challenge.

If you set pay too high, you adversely impact the financial health of your employer and limit your ability to hire the talent you need.

If you pay too little, you risk losing your most valuable employees and failing to attract the best new talent.

And getting the amount of base pay correct along with the amount you pay for sales commissions or bonuses is another challenge. And then add long-term incentives and it’s just a complex nest of competing priorities, governance, compliance, tax issues, and things you can’t control.

You are balancing the need to be competitive with being equitable. And how you communicate about compensation is going to influence the perception of fairness.

And then, of course, you have the budget you must adhere to as well.

It takes not only analytical skill but skepticism to be a good compensation leader. No data source is perfect, and some are just…well, awful.

And EVERYONE has an opinion about whether your recommendations are good.

And EVERYONE has big emotions about how they are rewarded and how their team members should be paid.

And you can’t make everyone happy.

I once had a manager tell me that I wasn’t doing my job if I wasn’t saying “no” sometimes.

May you find the right temperature for your office and for your compensation programs. Know you aren’t alone.

#compensation #rewards #payequity #paytransparency #humanresources