Ask people what they do in private and you’ll probably hear far more detail than you want, but ask what they earn and they’ll either freak out at the question or be very insulted.

What they probably won’t do is tell you.

Sex used to be personal, but these days it is often broadcast to anyone who will listen, but not finances—although older workers are less likely to discuss either of them.

Companies are even more paranoid about keeping salaries confidential—sharing compensation information is a firing offense in many of them.

Usually, the more a company insists that the numbers are private the more likely people are to assume that something is rotten—or unfair.

After all, gossip tends to exaggerate things. Professor Lawler says studies show that when pay is confidential, workers often believe the salary distributions are more unfair than they really are.

That’s why Dane Atkinson, chief executive of SumAll, a data analytics company, does things differently.

When he helped found the company about three years ago, a decision was made to disclose all salaries and equity shares. (…) “In this way, more money goes not to those who negotiate better, but those who work the hardest,” he said. The people who resist making salaries more transparent, he said, “are usually those who think they’re making too much.”

The other people who resist are the bosses who are playing games with compensation.

You know, the ones who make the lowest offers possible and/or play favorites.

Compensation, whether salary or stock, should make sense to everyone; it should be plausible and accurately reflect the person’s contribution to the company’s success—not their charm, personality, looks or threats to leave.

Flickr image credit: Derek Keats

Over and over research has shown that money is no where near the top of what people want in their jobs.

Ask people what they want in a job, and meaningfulness looms large. For decades, Americans have ranked purpose as their top priority—above promotions, income, job security, and hours. (…) After more than 40 years of research, we know that people struggle to find meaning when they lack autonomy, variety, challenge, performance feedback, and the chance to work on a whole product or service from start to finish.

But even those aren’t enough to make it to the number one position.

First and foremost, what makes a job meaningful is doing something that has a “significant, lasting impact on other people.”

But what can you do if you work for a real-world pointy-haired boss and/or a company stuck in a Fifties mindset?

You need to take control, since changing jobs isn’t always an option.

How?

Try one or more of the following

1. Don’t buy into your boss’ or your company’s view of you.
2. Find what meaning you can in your work, even if it’s not the “change the world” kind or all that obvious.
3. Add more meaning outside of work—you are not your career.
4. Invest in a meaningful future by developing skills and/or contacts that will lead to the changes you desire.
5. Hang out with meaningful people—as defined by you, not those around you or society in general.

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Be sure to click over to see the February 2014 Leadership Development Blog Carnival: What Great Leaders Do

Flickr image credit: Max Klingensmith

Wanting to make a difference has been one of the top three reasons for people of all ages and backgrounds to join or leave companies for decades and it’s only increasing with today’s attitudes.

Many of today’s most desirable new grads are applying to Venture for America, a nonprofit organization that selects fellows to work in cities, like Detroit, that aren’t the usual magnets for top, young college grads from the most elite universities.

They are turning down six-figure salaries with prestigious firms for the chance to have real impact.

This is the same reason that most people join startups—small team means a bigger impact by each person.

Outsiders and the media most often focus on startups as a path to riches, but that’s not what’s uppermost in the minds of most candidates.

While many crave work on the bleeding edge, whether of technology, medicine, business process innovation or something else, 99.9% are there to have an impact and make a difference.

Even if the effort doesn’t succeed, they want to look back at that time with satisfaction and know that their own actions helped get it as far as it went.

Efforts like Venture for America and the opportunities they create are the best chance to change the course of potential failures that permeates our country.

We need many more of them.

Image credit: Venture for America

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

Ask any recruiter or manager who has been around for awhile and they’ll tell you there is only one guarantee when it comes to talent: supply and demand are always at odds.

The danger is highest for those to whom hiring is newest and founders can be especially vulnerable.

Obviously, founders and others in a startup are excited and high on what they are creating or they wouldn’t be there.

And therein lays the danger.

In the heat of competition from other startups and the excitement of converting the candidate to their vision interviewers forget or avoid asking certain questions.

Worse, if the candidate is super-hot or possesses badly needed skills interviewers often avoid asking anything that might spoil the deal or turn the candidate off.

But it is of little use to hire even extraordinary talent if they don’t stay or bring in someone who will trash the culture and tear the team apart.

Which questions are most often ignored?

The tough questions, which are, by definition, any question to which you don’t want to hear the answer.

Simply stated, tough questions are the ones that bring a negative answer when you want a positive one and vice versa—in effect killing the deal.

Here are some sample tough questions and their potentially deal-killing answers:

• Q: Does the project turn you on?
  A: Not particularly.
• Q: Then why are you here?
  A: I heard I could make a lot of money and get a ton of stock options.
• Q: What do you find attractive about the position?
  A: The perks are awesome.
• Q: Do you like our location?
  A: Well, it’s about an hour from where I live.
• Q: How soon after accepting can you start?
  A: I’m in the middle of a project and would have to finish, and I’d like to take a couple of weeks off—say, about three or four months.

Money questions are often a minefield.

• Q: What kind of compensation package do you want?
  A: Well, I just got a raise, a promotion, and a large stock grant and currently I have six weeks of vacation, and I’d like to improve on that.
• Q: Our salary range goes to $100,000.
  A: Oh, I’m currently making 95 and have a review due in a couple of weeks.

The important thing to keep in mind about tough questions is that if the response kills the deal or raises serious red flags you are better off to know it sooner rather than later, before you spend time crafting an offer or having to contend with a hire who damages the company.

There are other important benefits from asking though questions.

Bringing potential problems out in the open gives you the opportunity to solve them, but first you have to identify them.

Finally, the discussion itself is valuable.

You learn more about a person’s priorities, ethical structure, style, and personality when discussing difficulties and solving them is the beginning of the bond that is the basis for the most productive relationships.

Image credit: HikingArtist

From two different authors.

“I haven’t worked this hard in years and have never felt so valued” —a former colleague who had changed jobs

“To the brain, receiving a compliment is as much a social reward as being rewarded money.” — Professor Norihiro Sadato, the study lead and professor at the National Institute for Physiological Sciences in Japan

Taken together they should drive home the value of telling your people outright how much you value them or how good something they did was,

I’m not talking about compliments for compliments sake—those are hollow and only extend the bad habits learned in school, such as when kids are complimented just for showing up on time.

I’m also not referring to ‘stars’; those almost mythical employees who some managers seem to value more highly than their entire team. (Guess which is more easily replaced the one star or the entire team.)

I do mean the heartfelt appreciation for a task well done or for being a good team member.

So in the stress and pressure of achieving deadlines don’t lose site of the two most successful motivation and retention factors yet found:

• the chance to make a difference; and
• being appreciated.

And just think—they don’t cost a dime.

Flickr image credit: dinny

Have you heard about a very smart startup called Developer Auction?

Developer Auction, which allows companies to bid for the services of high-performance software engineers. It’s a disruptive idea because the San Francisco-based company makes it easier for companies to find workers, which in turn get more money for their services.

It generates revenue by taking 15% of the negotiated salary and then kicks back 20% of that to the candidate.

I’m sure it will make a lot of money, at least in the short-term considering the current hot market.

It also is the absolute stupidest hiring move companies can make, not that that will stop them.

I can think of no better way to find developers to whom money is everything and product passion and loyalty are words in the dictionary.

Not to mention the effect on the current team, company culture and internal salary structure.

But it does offer the wow factor of cutting-edge bragging rights and the fanfare will probably camouflage the hiring manager’s lack of staffing skills.

Rather than address the stupidity again, I refer you to three posts I wrote early last year, insanely stupid hiring, insanely smart hiring and insanely smart retention and stars that thoroughly cover the subject.

Take time to read them and feel free to call or email me (contact info on the right) if you need any assistance at no charge—I never charge for doing good deeds.

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Dewey & LeBoeuf is a law firm; it was born in 1909 and is dying in 2012.

Its death is the result of a culture in which money replaced values—

“Because the partnership lacks any shared cultural values or history, money becomes the core value holding the firm together,” said William Henderson, a law professor at Indiana University who studies law firms. “Money is weak glue.”

and a toxic star system.

Even as Dewey’s performance flagged, the firm doled out lavish multiyear, multimillion-dollar guarantees to its top partners and star recruits. The guarantees — there were about 100, with several over $5 million a year — created compensation obligations that the firm could not meet.

Of course, they aren’t the only law firm or other type of business to founder and sink on the rocks of unfettered growth, mergers, aggressive hiring, outsize pay packages and compensation disparity that creates an internal us vs. them mentality.

In short, 103 years down the drain.

The Dewey & LeBoeuf failure provides glaring proof of the importance of a strong shared-values culture and testimony to the mantra I evangelize—people who join for money (or perks or stock) will leave for more money (or perks or stock).

Image credit: Tombstone Generator

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Money makes the world go round. It’s one of the main causes of divorce and, right now especially, is on everyone’s mind.

I tend to agree with George Bernard Shaw that “Lack of money is the root of all evil.” That or an insatiable desire for more and more of it.

Way back in 1877, Russell H. Conwell said, “Money is power, & you ought to be reasonably ambitious to have it.” The problem these days is that people substitute ‘all out’ for ‘reasonably’.

I don’t know who said the following or if they are just folk wisdom, but they certainly are accurate.

“All I ask is a chance to prove that money can’t make me happy.”

“While money can’t buy happiness, it certainly lets you choose your own form of misery.”

“While money doesn’t buy love, it puts you in a great bargaining position.”

I also like Lord Mancroft’s comment, “Money can’t buy friends. But you can afford a better class of enemy.”

But Francis Bacon really hit a homer with his statement, “Money is like muck, not good except it be spread.”

According to Samuel Butler, “All progress is based upon a universal innate desire on the part of every organism to live beyond its income,” which is a good description of our current situation.

Then, of course, there is Emile Henry Gauvreay’s almost perfect description of the attitude that got many of us where we are today, “I was part of that strange race of people aptly described as spending their lives doing things they detest to make money they don’t want to buy things they don’t need to impress people they dislike.”

If you want to significantly improve your life you should embrace Bacon’s words, while eschewing Gaureay’s.

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Actions have consequences, mostly unintended.

Ready, fire, aim.

In response—mostly—to the financial crisis, the US government has taken so many actions that the list is almost too long to chronicle here. To pick a few…

• The government has picked survivors in the banking industry.
• The government has picked survivors in the auto industry.
• The government has picked executives in many companies.
• The government has set compensation levels in many industries.

And the government’s intrusion into previously private enterprise sectors has only just begun.

Of course private enterprise has never been a model of virtue and discretion. But, just because private enterprise has executed a series of excesses, is it reasonable to assume that federal regulation will produce unalloyed goodness?

If executives in private enterprise cannot foretell catastrophes ahead, is it reasonable to assume that those same executives, when working on behalf of the federal government, will have better foresight?

Massive Actions, Unintended Consequences

The economy is in uncharted territory. This is the first major crisis of the integrated, global economy. It simply has too many moving parts for any individual or organization to identify all the inter-relationships, much less to forecast the results of all those interconnections. The chart below makes the point exquisitely.

Historically the money supply has grown by 2-7% annually, with spikes prior to Y2K and following 9/11. In the past nine months, the Fed has increased the money supply by over 100%, almost ten times greater than the largest previous increase, during Y2K. The Fed might argue that this increase was needed to offset the loss of a comparable amount of bank lending, when credit dried up in the past year.

But how and when does the Fed unwind this massive increase? What are the long-range consequences of this action?

At the moment, no one can guess. However, we can be certain that many of the consequences will be significant, unforeseen, and unintended.

Transparency – The Only Cure for Unintended Consequences.

The Federal government now controls almost 25% of all domestic economic activity, not to mention 100% of the money supply. We need much more transparency, particularly with government sponsored enterprises such as Fannie Mae and Freddie Mac.

Recently our culture has cheapened transparency to the cliché “full disclosure…” after which the author lists some relationship, often trivial.

The US government pumped over $170 billion into AIG late last year, to prevent its collapse. This expense received very little exposure, either from the press or by the Treasury Dept. execs who made the “investment.” Where did this $170 billion go? Why was this expense necessary?

Neither elected congress people nor Presidential staff exhibited any curiosity or outrage over this “investment.” However, when AIG paid out $165 million in bonuses—only 1/1000 of the amount the Treasury Dept. had spent a few months earlier—elected officials went into hysterics. Selective transparency is no transparency at all.

“Sunshine is the Best Disinfectant.” –Supreme Court Justice Louis Brandeis

Meaningful transparency can have considerable impact. Witness the recent publishing of the expense accounts of British Members of Parliament.

In the US, the Federal Election Commission (FEC) regulates campaign contributions. Of course every politician running for office has thoroughly computerized records of donors and amounts and the FEC requires that every candidate report all donations to the FEC. That information might be interesting to voters making voting decisions. But candidates provide those reports to the FEC in thick, printed volumes, specifically to delay the FEC in compiling the results. As a result the FEC finally publishes the donation reports months after the elections are done.

Follow the Money—Post Everything on the Internet

With the expansion of the government into finance, autos, energy, and insurance, as well as health care, public disclosure is critical if our economy is to respond positively. Encourage your elected representatives to post budgets, and expenses on the internet.

Over time, we can recapture our democracy.