A healthcare CEO once told me that most corporate behavior is irrational. While this caught me off-guard at first, I then realized I was in agreement.
- A paycheck, regardless of the amount, represents our job that emotionally provides us purpose, stability, and shared mission.
- Human behavior is influenced by incentives, social norms, framing references, and previous experience. Part of this–pay fairness–is a perception of inputs (credentials, experience, amount of effort, outcomes) to their rewards (salary, equity, benefits). If not equal, there is a psychological strain.
- In 2012, average CEO compensation multiple of employees was 204, which is a 20% increase over 2009.
- More work today is done on teams or projects, yet this is more challenging to reward than individual performance.
- If not in a position of power, is the stock price really a motivator?
- People will work hard for a paycheck, harder for a person, and hardest for a purpose.
Is your salary structure rational?
