Driven by an ever-accelerating trajectory of knowledge and technology, the 21st Century clock drums a wild beat that
In light of these dynamics, let's examine challenges that are altering the way survey providers are gathering and reporting compensation data:
The very concept of 'jobs' is being challenged by today's flatter, leaner, boundaryless, team-oriented enterprises. Many employees are performing a broader, more loosely defined cluster of tasks, possibly as a member of a cross-functional team. Hybrid jobs are being shaped to fit each company's specific organizational needs and to optimize the use and development of their employees' competencies. These fuzzy-bordered, broad organizational roles fail to cleanly match former survey benchmarks.
In response, survey providers are including these redefined jobs in their surveys. Adding these "variation on a theme" jobs has a tendency to reduce the sample size per job, assuming a constant number of participants from year-to-year.
Concomitant with organizational change, emerging and evolving technologies require the creation of new jobs (e.g. Knowledge Manager, Chief Learning Officer, Webmaster, Online Marketer, Site/Page Designer, etc.). Depending on the technology, two scenarios arise:
The technology is applicable to only a few companies, operating in a deep niche market.
The new technology-related jobs may fall under the strict definition of 'benchmark,' but the labor market universe is small. Survey providers are responding to this situation by offering more and more small, specialty surveys.
The technology is widely used and rapidly adopted. There is sufficient demand for pay data for these new benchmarks. Survey providers add them to existing surveys or create new survey products in response to the needs of this emerging market.
In an attempt to achieve a competitive edge, and because technological advances make this possible, survey providers are offering shorter turnaround time and increased survey frequency. An increasing number of survey users, moving at an ever accelerating pace themselves, are coming to expect this level of service.
Unfortunately, while survey data can now be input, analyzed and reported with lightening speed (thanks to powerful computer hardware and software), turnaround speed also depends upon the timeliness of participant response. Due to downsized human resources departments, compensation practitioners find themselves with little time to respond to surveys especially to surveys of ever-increasing length and complexity.
Some survey providers report a growing difficulty in sustaining participation levels, primarily ascribing this to respondents' lack of time or capability. (Other contributory factors are leaner budgets and a cavalier attitude toward competitive pay, based on the existence of a buyers' market, whenever such a market emerges. Other providers report a stable number of participants, although the companies comprising the sample are continuously changing. This presents some problems in making year-to-year comparisons. In response to this problem, some providers analyze a constant population subsample (participants who continue to respond year-after-year) in order to report pay trends.
Organizations are striving to align their compensation with their business strategy by linking rewards to performance at all organizational levels. They are designing a variety of incentive compensation programs, including gainsharing, goal-sharing, profit-sharing. They are also using stock-based programs at the individual, group/team, and organization-wide levels.
Responding to this trend, survey providers are attempting to measure actual and target incentive compensation. This is not an easy task. Beleaguered survey respondents may not be privy to all of the needed information. However, as the number of organizations using incentive pay as a key compensation element increases, the more prevalent it becomes for survey providers to report total cash compensation levels.
Some companies are experimenting with the use of competencies as a basis for all or part of their employees' compensation. These companies seek surveys that use competencies rather than jobs as independent variables. In other words, because benchmark surveys are not best-suited for companies using competency-based pay, they may choose to in maturity surveys, assuming that knowledge and experience are positively correlated (an assumption subject to ongoing debate).
Some leading-edge survey providers are attempting to link pay to competencies, using multiple regression analysis. But So far, the methodological complexity of gathering and analyzing these data is daunting and the results are not very impressive.
Traditional benchmark surveys remain the bedrock for keeping abreast of supply and demand market reality. Aside from a presentation of prevalent data on the percentage of companies that are using competency-based pay, the effort required to report actual competency-based pay levels is not justified by the present demand or quality of results.
Companies using competency, or skill-based pay, are learning the hard way that benchmark jobs still define market realities. Competency-based approaches to pay can be linked with traditional job-based surveys, but the difficulty and judgement involved should not be underestimated. As market-driven pay systems are increasingly used, competency- based approaches continue to be scrutinized.
In an effort to eliminate the rigidity of traditional pay structures and allow for flexible role definition, some organizations are moving toward broadbanding. To the extent that broadbanding is used, salary range data (minimum to maximum) become less meaningful. Some surveyors limit their analyses to control points or target pay (broad-banding's analogy to conventional midpoints); others continue to report pay ranges, but selectively eliminate the minimum and maximum pay data from broad-banding companies during their quality control review.
Driven by the desire to eliminate time-consuming internal evaluation systems, and to debureaucratize compensation administration, many companies are turning to market pricing. This leads to survey-dependency and increased demand on survey providers to furnish pay data for as many jobs as possible, in as much detail as feasible.
Thanks to a multitude of new technologies, survey providers have been able to meet their customers' demands. Still, innovative organizational designs create more and more nonbenchmark jobs; these generate a need for a job evaluation system that can liberate such organizations from slavish dependence on survey data.
Not all survey providers make full use of today' Information Age technologies, nor do all companies require their use. What we are proposing is that, inevitably, they will be employed and accepted by every survey provider and participant. They key is that these technologies will be more accessible and less expensive.
A half-century ago, survey number crunching left the world of the green eyeshade brigade. Binary code and silicon chips replaced adding machines and calculators. Moreover, nearly two decades ago, survey document design and production left the world of moveable type, rubber cement and illustration boards. Taking their place were personal computers, word processing and page layout programs, and laser printers.
Today, survey providers are using these technological advances to keep pace with their customers' changing needs. Survey providers are now able to offer flexible products, up-to-the-minute data, and enhanced product quality. Flexibility
Today's computer technology makes it easy for providers to customize their products to customer needs. Changes to any element of survey content can be made within minutes, using cut and paste commands. Similarly, changes to the survey's analytical processes can be executed simply by selecting them from a statistical software application menu.
Each year, computer hardware and software become more powerful. Moore's law is inexorable. Consequently, survey providers are able to dramatically shorten production time by designing entire survey packages with a variety of linked software applications (database, statistical analysis, word processing, page layout and illustration programs).
Computers are also used to automatically flag input anomalies. This does not eliminate the need for an expert human eye, but it strengthens the quality-control process.
This brings us to the two-way transfer of data and findings between survey providers and users. Here, actual use has not caught up with available technology. A number of survey providers are offering the electronic transfer of information to their participants, with varying degrees of acceptance.
While it is now commonplace for participants to fax survey input back to providers, they prefer to have "hard copy" questionnaires and reports mailed to them if they questionnaire is longer than a few pages.
Although most practitioners' regularly receive dozens of e-mail messages daily, and find it the most convenient way to dialogue with others, they are concerned about the security of electronically transferring confidential data.
Many survey providers are offering participants the choice of submitting data via computer disks and/or CD-ROMs. These media offer the advantage of low reproduction and distribution costs, and nano-cost/nano-time data entry for the survey provider, and ease-of-completion for the survey participant. Leading-edge survey providers are now distributing software to their customers which self-extracts the appropriate data from the company's internal information systems (e.g., PeopleSoft, Oracle, Abra) once the survey respondent has established the proper protocol for secure data extraction.
Disks and CD-ROMs are also advantageous for delivering survey findings. Not only does the technology provide convenience and speed, but also the ability to put so much information on one of these devises is enabling survey publishers to offer several surveys on one disk or CD-ROM. With the software that accompanies the survey report, or widely used resident software (e.g., Microsoft Access), survey users can manipulate the survey data to custom design their own reports.
Survey data and findings may be downloaded from, and uploaded to, provider web pages. While the Internet is open to anyone with a modem and service provider, security can be achieved through firewalls, encryption and use of hidden addresses and closed networks (i.e., extranet) using passwords and codes. Even more than e-mail, companies are suspicious about the claims proffered regarding Internet security.
Besides security issues, some companies have yet to issue modems to their compensation departments. They also have not decided on policies governing their use outside of company boundaries. As these issues are resolved, and the values of this new communications and information technology are fully appreciated, we know that cyberspace will increasingly crackle with compensation goodies.
With or without the sanction or encouragement of their employers, practitioners are using home computers to search the Web for useful compensation information. Online articles, surveys, white papers, policy manuals, government regulations and much more are available to anyone with a computer, a modem and curiosity. In addition, professional chat lines, bulletin boards, newsgroups and mailing lists provide practitioners with a forum for collegial dialogue (including compensation data sharing).
The convergence of communication and information technology has made it possible for survey providers to empower their customers. Practitioners are now able to customize their pay survey reports by selecting their own data subsets (industry, geographic region, job, organization size and peer group), analyses and graphic displays from user-friendly menu bars.
Providers are also helping customers eliminate the tedium of time-consuming questionnaire completion. As previously noted, practitioners can now link their companies' human resource information systems directly to the survey. Changes to survey imput can be made in real time, concurrent with employment and compensation changes. Participants may also download (or request e-mail or fax transmittal of) the most recent survey findings in real time, on an as-needed basis.
Lastly, while the survey may be transmitted without sacrificing a single tree, participants can order printed copies from the provider. Also, they may choose to transfer the text to their own word processing program, select their own fonts and layout, generate a report on their own laser printer, and reproduce and distribute as many copies as they need.
Today's compensation surveys are not what they used to be. An information age survey system is emerging. Technology and organizational changes are reshaping every aspect of survey content, design and delivery modalities. Twenty-first century survey products are more responsive to customer needs in every way. In a nutshell, providers are giving practitioners what they want, when and how they want it.