Stickman Putting Teeth in P4PDo you remember getting having your first teeth come in? I don’t, but I have seen it happen and it isn’t fun. Often, Pay for Performance can be a similar experience. Of course, it is required for long-term success, but while it’s happening it is painful and confusing. And, you quickly learn the process is nowhere near complete when the teeth have finally come in.

Every compensation professional who has ever worked on an incentive plan has struggled long and hard with figuring out exactly what was to be accomplished, how it could be measured, what levels of achievement were good enough, what levels were actually good and what levels were truly great. We have fought to get our programs understood and approved by the same management teams who requested them in the first place. We have trained managers to support these plans and coach their staff. We have worked to explain these programs to participants in ways that would help them perceive the value of accomplishing the goals set for them. We have watched these programs be marginally successful in the face of great planning and extraordinary effort.

The pain that usually accompanies putting these plans in place can be enough to bring tears to your eyes. The relief when the plan is finally rolled out can be the first time to relax in months.

But, like the infant with new teeth, the work really begins at rollout. It takes time and practice to make things work the way they were planned. Along the way you will occasionally bite into the wrong thing (sometimes yourself.) You must learn from every new experience and push forward even when your tongue hurts from the last errant chomp.

As you master using your teeth, you tend to forget about how important they are in helping you succeed. You forget the time they protected you from an overly aggressive cousin. You can’t remember a time when eating solid food was impossible. You can become complacent. Then one day you are once again in pain after so many years of peace. You visit the dentist and they tell you the lack of brushing and flossing has resulted in cavities that must be addressed immediately.

The same is true for a P4P plan.  A new CEO or outside consultant comes in and asks a few questions and we are relegated to guesses and assumptions. The holes in our programs become instantly obvious and everything else gets put aside as we scramble for a quick solution.

It may be obvious that the lack of sleep from my 5-month old son’s teething is causing a collision with my thoughts on compensation. I hope I remember to show him this post when he gets old enough to read (maybe by this summer?) Hopefully, he will start taking better care of his teeth or, at the very least, begin working in the family compensation business!

Dan Walter is the President and CEO of Performensation a firm committed to aligning pay with company strategy and culture. Dan, Ann Bares and Margaret O’Hanlon of the Comp Café were recently honored to have their bookEverything You Do in COMPENSATION IS COMMUNICATION” called one of the “best comp books I’ve seen”, by Steve Browne of HRNet email fame. Dan has also co-authored of several other books you may find useful including “The Decision Makers Guide to Equity Compensation”, “If I’d Only Known That”, and“Equity Alternatives.” Dan welcomes connections on LinkedIn. Follow him on Twitter at @Performensation and @SayOnPay.

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