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Cafe Classic: Excessively Successful Incentives

Compensation Cafe

Editor's Note: In this Classic cautionary tale, Jim Brennan (using the 2016 Wells Fargo incentive disaster as his beginning "case in point") reminds us of how easily even reward plans designed with the best intentions can misfire. The only thing worse than an incentive that doesn’t work is one that works all too well.

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Stuff Changes

Compensation Cafe

After every kind of corporate HR and consulting role in every industry, he was Senior Associate of pay surveyor ERI before returning to consulting in 2015. A prolific writer (author of the Performance Management Workbook ), speaker and frequent expert witness, Jim testified in many reasonable executive compensation cases.

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Cafe Classic: Don't Blame Incentives

Compensation Cafe

Editor's Note: Incentives are a tool. Incentives are not the cause of bad reinforcement programs, any more than forests should be blamed for the existence of warfare. Because incentives are powerful, they should be designed and implemented with great care. Jim Brennan expounds. It was a hell of a good place to write tickets.”.

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Excessively Successful Incentives

Compensation Cafe

The only thing worse than an incentive that doesn’t work is one that works all too well. Wells Fargo is just the latest company to be ethically embarrassed and financially distressed by a fiasco involving excessively motivational incentives. The moral hazard problem is not industry-specific or even an issue about incentives.

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Cafe Classic: Why Are Mentors Worthless?

Compensation Cafe

Oh, some mentioned that a mentor could be nominated for a spot bonus or a recognition award, if a manager saw fit to recommend so; but there were no reports of any formal programs for the care and feeding of the nurturers of tomorrow’s talent. . That is the apparent conclusion from both my experience and my research.

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Cafe Classic: Disengaging from Compensation Schemes

Compensation Cafe

No reinforcement program or incentive plan works forever; but they seem to last forever, lingering on long past the day when their effectiveness expired. After corporate HR posts and consulting CEO roles, he was Senior Associate of pay surveyor ERI before returning to consulting in 2015. Enjoy - and add your thoughts/advice!

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Cafe Classic: Positives About Negatives

Compensation Cafe

Although we are continually reminded to be alert for perverse incentives , little is usually said about the proper use of disincentives. If being included in a bonus pool is a positive motivational incentive, shouldn’t being restricted from participation be considered a negative punishment? Negatives have positive aspects.