When we think about tools like Expedia and Yelp, we realize the value of transparency in the marketplace. The
underlying issue is information asymmetry – when one party has more information than the other, that party
has additional leverage in a discussion or negotiation. Leveling the playing field between two parties in an
exchange helps both to feel like they got a fair deal, which is essential in an employment situation. This
specifically applies to compensation as well. There is value in openness, and companies that find the right
balance can reap the benefits of pay transparency

Research Supports an Open Approach: Research points out that companies where employees understand the pay philosophy are more likely to see engagement from employees. A sense of trust and openness at work can create bottom-line business results. On the other end of the spectrum, pay secrecy has proven to limit business impact. This combination of factors clearly makes the case that businesses need to seek transparency at some level.

Trends in Transparency: A wide variety of trends have contributed to this increased demand for compensation transparency. From the deep insights offered by tools like Charity Navigator (and other online transparency sites) to the media sharing stories of corporate corruption and scandal, many drivers have created an environment that is ripe for additional openness.

Delivering a High-Quality Employee Experience: The good news is that any organization can improve pay transparency. Using tools like transparency audits and frameworks, companies can deliver a culturally-appropriate level of openness that improves the employee experience. These methods help organizations to make decisions (both big and small) in search of the right balance of transparency.

The Business Case for Transparency

Several years ago, Dan Ariely, a behavioral economist and professor at Duke University, performed an analysis of country-specific organ donation rates. His findings showed that countries like Austria and Poland had higher than 99 percent donation rates, but countries like Denmark had dismal rates in the single digits. He wanted to find out what made each group different, because Denmark is very similar to its neighbors in terms of culture, religion, and other socioeconomic factors.

It turned out that the key influencer was not an intrinsic one at all. Each country’s Department of Motor Vehicles actually used a different method for enrolling someone in organ donation. For Austria and Poland, the enrollment form’s default was to participate in the program. For countries like Denmark, the enrollment form required them to opt into the program. That small difference led to significant impacts on organ donation and availability, and it offers a compelling lesson on how our default reactions can shape outcomes.

The lesson here is, given the choice, we should default to transparency. For some business leaders, it is reflexive to protect information, keeping it secret unless they have a good reason to share. While working as an HR leader, I performed plenty of coaching with my executive team focused on the concepts of pay transparency and business transparency in general. I always told them their default should be to share openly unless there are specific reasons not to. The benefits of this approach include greater awareness and engagement in the employee population.

If you’re interested in reading and learning more about compensation transparency, be sure to check out our free eBook on the topic underwritten by the great team at Salary.com, where this content was pulled from. I’d love to hear your thoughts on the topic!

This summer at Lighthouse we’ve been working our way through a number of research studies, but to be honest one of the ones I’ve been incredibly pumped about is focused on performance management. It’s probably because I get a sense of the discontent around this practice regardless of where I go and who I speak with. It’s incredibly hated at so many companies by HR, management, and the employees.

But there are also companies that are using it as a kind of secret weapon. In the research (the full report will be published in September) I am seeing some very interesting points on how companies plan to approach the practice of performance management, and it’s encouraging me to focus on it not just as managing or reviewing past performance, but enabling great future performance.

Top 10 Research Highlights

  1. We keep hearing it in the news–performance management is shifting/changing/dying. It’s certainly not staying the same. Approximately 60% of employers have made changes (including both minor adjustments and major shifts) to their performance process in the last 24 months. Another 25% are planning to in the near future.
  2. Despite the common discussion, annual goals still rank as the number one way employers manage performance. This is followed by recognition, coaching, and leveraging strengths.
  3. While performance feels like a drag for many employees (anecdotally :-)), the number one reason employers still practice it is to improve individual performance for workers.
  4. Which seems kind of said, because just 4% of employers say that their approach is highly effective and enables greater employee performance.
  5. Nearly one in five companies say that their performance management technology is clunky and difficult to use, which hinders progress in performance management, measurement, and improvement.
  6. At the same time, two-thirds of companies say that their approach improves engagement levels for their workforce. This is very much split by the kind of culture a company has (more on this below).
  7. High-performing companies are 58% less likely to say their approach to performance management is ineffective.
  8. High-performing companies are 20% more likely to say their performance management philosophy improves engagement rather than diminishing it.
  9. Astonishingly, companies with a competitive or controlling culture were more than three times as likely to say their approach to performance management failed to deliver the results and may actually impede employee performance and engagement.
  10. The performance practice spectrum. We’re analyzing the data through the lens of performance management activities on a spectrum. On one end are the old-fashioned, unpleasant activities like forced ranking and annual reviews. On the other end are more positive, engaging practices such as development coaching, peer feedback, and more.

    What we see in the preliminary results is that companies with a more collaborative culture are more likely to practice on the positive end of the spectrum while firms with more controlling cultures are more likely to fall on the negative end. More to come on this as we explore the data!

These highlights, while intriguing, are fairly high level. Look for additional insights in our upcoming white paper and webinar (to be announced) that focus more deeply on culture, what high-performing companies do differently, and other key insights from the research!

I attended the WorkHuman conference a few weeks ago in Arizona and connected with many friends and colleagues that I hadn’t seen in a while, and each of them asked how my work was going. This week marks my one year anniversary of running Lighthouse Research & Advisory, and it has been such a joy. Here is the link to my announcement last year, in case you’re a new reader.

I’m able to do the work that I love, whether it be writing, speaking/teaching, or research. I also have the flexibility to support clients in a way that other, larger analyst firms just can’t, and I keep hearing over and over how unique that is.

For those of you that are curious, my day to day is spent creating or uncovering research on a variety of topics. In the last month alone I’ve explored informal learning practices, global payroll and compliance for growth companies, and the impact of employee engagement on business performance. I then use that research to host webinars, write white papers, or create other research assets for my clients. At the end of the day, I’m creating things for you, the practitioners, that offer value and help you to get your work done more effectively. It’s just that the vendor community pays to have those resources developed for you.

Obviously I also run the We’re Only Human podcast, which kind of straddles both the work I do here at upstartHR as well as my work at Lighthouse. It has surprised me in the ten months that I’ve been running the podcast, but I get so much interaction and feedback from that medium and am constantly surprised by the positive reception. I’d be curious to know what you think about it and/or what you’d like to see me cover on the show.

At the same time, part of my research always has been (and will continue to be) in large part due to connectivity to the practitioner community. Each of you has a unique, valuable story to tell about your own business and HR practice. I am always interested in hearing those stories and learning from them. I’ve found that pretty much all practitioners think their stories are not that interesting or important, yet in every case I can find something unique or noteworthy about the situation in just a few short moments! Bottom line: your story IS important and interesting, and don’t ever think otherwise.

If you’d like to help, I occasionally send out research requests to gather information for new studies. Having responses from people like you is incredibly important to me. Additionally, don’t ever hesitate to ask questions about what I can cover here or to suggest topics that might be beneficial. I’m always open to ideas, and the truth is if you are thinking about it, there’s a good chance that a hundred others are that need the information as well!

So, with eight years of upstartHR and one year of Lighthouse Research behind me, I’m still going strong and feeling just as creative as the day I first started (if not more so). I can’t wait to bring you more insights, ideas, and information in the coming months. And you? Yeah, keep up the good work. :-) Thanks as always for being a part of this great community!

The new year brings new challenges and opportunities as we attempt to whip our HR and recruiting functions into shape. One of the new projects we’re working on at Lighthouse is our Global Talent Acquisition Sentiment Study. With more than 400 votes, we are helping to narrow down the most pressing priorities and topics across the talent acquisition function. The infographic below offers some insight into what those priorities are, and my forthcoming report on the topic will delve into how the data shows differences in US and non-US populations, what trends are driving the relative importance of each of these issues, and what to expect in the coming months.

I’m also delivering a presentation on this topic in March and would be glad to share these insights with your group in a lecture, workshop, or webinar. Just reach out via my speaker page and we can discuss. 

Below are some of the noteworthy findings.

Key Priorities are Not Function-Related

Some of the key priorities in the study that came out on top were focused not on specific practices in recruiting, but on more broad aspects, such as process improvement and business alignment. This is a positive finding, because all too often when I’m working with clients I see that they have a great onboarding or branding program, only to find out that it’s working in opposition to their goals and business strategies.

Onboarding, Sourcing, Candidate Experience Top the List

It consistently surprises me when I see a group of talent leaders prioritize onboarding. Not because it is unimportant, but because it seems like so little effort is placed on it in reality. It’s possible that 2017 is the year we turn that around, making this a strategic differentiator for growth.

Next up is sourcing. I see a great divide between the highly capable digital sourcing professionals and the rest of the HR and talent leader community. This is so pronounced that it almost seems like a different profession, akin to marketing or customer acquisition more so than HR.

Finally, candidate experience was barely edged out for third place. In our recent research on the candidate experience, we pointed out some not-so-obvious ways to improve this practice with assessments, video interviews, and more. This discipline is steadily becoming more of a concrete science for talent leaders, which means we can find what works, make specific process improvements, and deliver higher value to our future employees.

One final note: you’ll notice that not much room separates any of these in the infographic below. This is good in that companies have their priorities in order, but it is also challenging, because when we have competing priorities it means we’re going to be less effective. It is critical to find the specific talent practice your team needs to work on and make it happen before attempting to move to other opportunities in the list.

Lighthouse 2017 TA Sentiment Study Graphic

Last week I published some new research that frankly surprised me. When we hear about video interviews, assessments, and hiring processes, we expect candidates and employers to be on opposite ends of the spectrum.

But it’s not the case. When asked a series of questions, both groups responded similarly, and the priorities for each group matched in terms of ranking, even if not in terms of exact percentages. In short, it was a very interesting set of research. I’ve posted a chunk of it below, but to read the full piece you’ll need to head over to Lighthouse Research.

The Candidate Experience: Perspectives on Video Interviews, Assessments, and Hiring

In some ways, hiring looks very similar to what it did twenty years ago. People search for positions, indicate interest, and are filtered down until the most promising candidate is offered a job. However, the technology we use has upgraded considerably over time. Today employers have tools to increase efficiency and efficacy, including video interviews, automated assessments, and more.

In a recent Lighthouse Research study backed by mroads, we explored some of the key aspects of hiring with video technology from both candidate and employer perspectives. The November 2016 pulse survey reached more than 250 individuals and employers, uncovering some interesting findings that both validated existing beliefs as well as uncovered some new insights. Here’s what we found out.

lighthouse special report

Key Findings

  • Stress Factor: Nearly 8 in 10 job seekers say that video interviews are as stressful or more stressful than in-person interviews.
  • Attracting Top Talent: 61% of companies say that peer interviews and interactions would be the best way to attract top talent with video hiring solutions.
  • Candidate Preferences: Nearly 25% more job seekers said they would prefer a live video interview to an in-person interview.
  • Candidate Assessment Perspective: Just under two-thirds of candidates think the right kind of assessments—those that give them an opportunity to showcase their skills or a work sample—prove their value in the hiring process.
  • Candidate Experience: Candidates believe that resumes are just as valuable as employment tests/assessments (25% each), but half of candidates say that video interviews are the most valuable tool for helping them stand out in the hiring process.

Click here to read the rest of the article (1,600 words total)