Friday, March 27, 2009

I want my retention bonus ... or else!

I’m trying to figure out this whole “retention bonus” thing that the corporate executives get in anticipation that they might leave for more money.

I’m thinking I might want to angle for my own retention bonus.

I begin teaching a 10-week course Tuesday. I’m thinking that about five weeks into the term, about the time I’ve made myself pretty much indispensable to the students' getting credit for the course, I’ll demand a “retention bonus.”

I’ll pass the hat around the classroom. "Your money or your class credit."

Why don't more folks demand retention bonuses? It seems like a no-brainer.

Why, for instance, don’t flight stewards come down the aisle collecting “retention bonuses” for pilots. The crew may have delivered you to 40,000 feet, but what if they decide they want a little extra to get you down — at least to where you want to go?

How about the plumber's demanding a retention bonus to finish the job? Without the bonus, the plumber could just walk away to another job that pays more.

Who's to say that those corporate executives are any more “indispensable” than the rest of us?

Think about brain surgeons in the middle of a job.

Or bridge builders.

Or soldiers.

Or bus drivers.

Hey, wait a minute, you say.

What about pride in one’s work? The satisfaction from a job well done?

Customer or company loyalty? Commitment to one's students, patients, passengers, nation?

Those are all so NOT what's happening. I mean, aren’t we really all in it for the money?

Today, commitment, loyalty, perseverance now come with a price — the retention bonus.

In the case of the executives, the bonuses are hundreds of thousands, even millions of dollars — and they apparently don't even have to ask for the extra money. It's just assumed to be part of the deal. Give 'em the bonuses — or expect to pay the consequences.

Then there's the curious metaphor "golden handcuff," which is what "compensation consultants" (another timely topic) call really big retention bonuses. The handcuff image begs deconstruction—starting with the question: Is a handcuff, even a "golden" one, ever anything more than a handcuff?


In the spirit of the subject, I refuse to share any more thoughts about retention bonuses ... until I get one myself.

Sorry, but that’s the way things are.

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Anonymous Anonymous said...

I'm not sure what is so hard to understand about a retention bonus. I think you are letting the word 'bonus' cloud your judgement.

At my last job I was laid off along with about 100 others when the site closed. Our projects were going to be moved to other parts of the company and to new teams.

We were offered 'retention bonuses' to stay on for a pre-determined length of time (60-180 days depending on the project) for a fixed fee payable at the end of the project. This was in addition to our normal salary and also in addition to the severance packages we received.

The reason companies do this is simple - it's less expensive to pay the bonuses and have a smooth transition and to allow 'tribal knowledge' to be passed along and documented properly. If we were just fired and walked out the door, it would cost the company many, many times the cost of our bonuses because of the chaos that a disorderly transition causes.

This all has nothing to do with pride in ones work, job satisfaction or anything else. It's business, pure and simple. If you've never run a business you really probably don't understand these concepts very well. You are used to getting your paycheck each month, same amount, never failing. When you run a business, you have a lot more to think about, I promise you.

Of course the corporate executives are more 'indispensable' than 'you' - these people run the businesses and have deep knowledge of the intricate factors like finance, supply chains, vendor and inventory management, logistics, HR, and a slew of other things the 'widget assembly line' crew knows nothing about.

This doesn't make them better or worse people than you, but they are surely harder to replace than a line worker. If the line worker wants a better lot in life, there are plenty of ways to improve education, skill sets, etc. It's when people start 'settling' for what the government tells them is 'enough' that we will see real problems.

6:56 PM  
Blogger Rick Seifert said...

As a matter of fact, I have run a business, a small community newspaper, which I founded, published and edited.

Those who worked for the paper did so not for the money, which was exceedingly modest for all of us, but because we all enjoyed the work and took pride in it.

As for retention bonuses, such rewards are often evidence of management failure. In essence, a failed firm is trying to buy its way out of a problem of its own making. Managers have to resort to cash incentives when they are unable to motivate employees or can't attract new talent.

You write of the corporate executives who are more 'indispensable' than "the 'widget assembly line' crew." Without that crew, those executives would have little if anything of value.

No widget makers — no widgets.

The real irony is that the very executives who create the company's problems are often the very ones receiving the retention bonuses.

They should be shown the door. Such a house cleaning can be the very best way to "retain" and indeed motivate valuable workers to commit to the company's future.

5:21 PM  

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