Table of Contents
Overview - Five Principles for Effective Compensation Design 5
1 Be Different: Aligning Compensation with Culture and Strategy 17
Lincoln Electric: "The Best-Paying Sweatshop in the World"
Meeting Stakeholder Expectations
The Good Jobs Strategy
A $70,000 Minimum-Wage
2 Fairness Not Sameness: Creating a Coherent and Flexible Pay Structure 33
Telemedicine Clinic: "Cleaning Up Our Comp Mess"
The Three Drivers of Base Pay
Leaders and Makers
Living-Wage, Not Minimum-Wage
3 Easy on the Carrots: Using Individual Incentives Effectively 55
Egon Zehnder: "Deliberately Old-fashioned"
Making Individual Incentives Work
Incentivizing Your Sales Team
Evolving Compensation Along the Growth Cycle
4 Gamify Gains: Driving Critical Numbers Through P(l)ay 73
MiniMovers: "A Bonus for Not Breaking Stuff"
Effective Gain-sharing Schemes
Irregular, Ad Hoc Rewards
Non-Monetary Rewards
5 Sharing Is Caring: Getting Employees to Think Like Owners 85
Access Fixtures: "No More Wining and Dining"
Aligning Interests Through Profit Sharing
Sharing Value with Those Who Create It
Options for Value-Sharing
Closing: Get Pay Right and Out of Sight 102
Appendix 104
Appendix A Six Principles of Persuasion
Appendix B Total Rewards Statement
Appendix C Compensation Philosophy Statement
Appendix D Market References
About the Authors 111