What's it worth to you? by Adam Sorensen

Earlier this week, I received an email from an HR website here in the US with the following subject line – Is it a mistake to trade salary for a better title?

My first reaction was a resounding NO! Having spent much of my career at a high tech firm where job titles were virtually meaningless, I’ve never been keen on job titles as an indicator or prestige or privilege. I know that some organisations spend huge amounts of time making sure that their job titles confer the appropriate level of distinction, credibility, and authority.  This is not necessarily a bad thing; I just have a hard time getting too enthusiastic about one job title over another. What did pique my interest from the email was the larger, implied question about what we, as employees and employers, are willing to trade for salary.

I’m not sure how many of us make deliberate calculations when thinking about the tradeoffs between salary and the other “benefits” we derive through employment, but I believe these tradeoffs factor into our reasoning more than we might realize.

Would you be willing to take a job that gave you more time off but a lower salary? Would you sacrifice £5,000/year in exchange for every Friday off? £10,000? Would you prefer a job that gave you an opportunity work in a field where you felt passionate and could make a real difference but paid very little, or would you choose one that paid more but was not really a match with your personal goals and values? How much is it worth to have a job that matches your goals and values?

£5,000? £10,000? £20,000?

For their part, employers weigh similar decisions. Is it better to devote limited resources toward improving the company’s infrastructure or recognizing top performers? If one costs more than the other and they are both worthy objectives, does one receive preference? How does one decide? Is it better to provide a rich benefits scheme and lower pay or more pay and fewer benefits? And in tough economic times, should employees’ happiness at having jobs be enough to compensate for lack of pay increases or bonus payments?

Clearly, there is not one right answer for every situation, and reasonable people can disagree about the relative value of different options. But as reward practitioners, I think we have an opportunity to think about and articulate how effectively designed total reward programmes can work to meet the disparate needs of an increasingly diverse workforce. Are there ways that we can design programmes that allow employees to choose between many good options rather just a good and bad one? Can we structure programmes in such a way to expand the range of choices and flexibility available to managers and employees alike? By providing more meaningful choices, can we create a lasting competitive advantage? Or are decisions about the “value” we offer employees really a zero-sum game where it’s always necessary to give up something in order to have something else?