"Best practice is either a product that somebody wants to sell and as a result it's common, but not necessarily proven as best."
Paul Reiman is the founder and managing partner of Novo Insights, a Chicago-based compensation consulting firm, with nearly 30 years in compensation as a consultant and in-house leader. His book Pay Differently, out October 5, argues that pay transparency exposes the shortcuts compensation teams have relied on for decades.
We cover the myth of best practice, the loyalty tax, job architecture as the office refrigerator, why the offer letter draws less scrutiny than the merit cycle, and whether sales commissions survive consumption-based selling.
What we covered:
- Best practice as common practice with a better publicist
- The telecom sales leader who asked a 22-year-old Paul, "Best practice according to whom?"
- The unproven rule of three measures in a sales plan, none under 20 percent
- Why candidates who refuse to apply without a range move employers faster than legislation
- The $100 toaster on sale for $50 the next day
- The fintech firm that turned down a star analyst asking for a $1 million salary
- The 75th percentile, and why a percentile is not a philosophy
- Job architecture as the office refrigerator and its 180 ketchup packets
- The manager who automates three roles and loses every direct report
- The loyalty tax, and why stayers earn less than leavers
- Merit budget benchmarking, and why to budget 9 percent next year
- Same-store pay growth, borrowed from Starbucks
- Lori the recruiter, her Coffee is for Closers mug, and fixing the front door
- Self-set pay at Semco and Smarkets, and crunchy or creamy peanut butter
- The printing company that replaced commissions with salary and profit share
- The hand-drawn overhead transparency behind the 50/50 pay mix slide
People:
- Alfie Kohn, author and previous guest on this show
- Dan Ariely, behavioral economist and previous guest on this show
- Andrea LaRowe, 37signals, previous guest on this show
- Stefan Gaertner, Syndio, previous guest on this show
- Daniel Kahneman and Amos Tversky, psychologists
- Teresa Amabile and Steven Kramer, researchers
- Boris Groysberg, Harvard Business School professor
- Louis Kelso, economist
- Philip Slater, sociologist
- Jerry Colletti, sales compensation consultant
- Bryan Briscoe, Paul's longtime co-presenter
Books:
- Pay Differently, Paul Reiman
- Chasing Stars, Boris Groysberg
- The Progress Principle, Teresa Amabile and Steven Kramer
Articles:
Organizations:
- Novo Insights, 37signals, Semco, Smarkets, Haier, Morning Star, Nucor, Handelsbanken, Spotify, Salesforce, Starbucks
Find Paul:
LinkedIn: https://www.linkedin.com/in/paulreiman/
Website: https://www.novoinsights.com
Book: https://paydifferently.com
Music licensed through Soundstripe. Code: DLQOKHPSWUMSTCMH.
