Money is not everything

02 February 2023
5 min read
Featured Image

However, being transparent about money is 

You pay for talent

With an increasingly dynamic labor market, and the constant changes associated with innovation and technological transformations, organizations are becoming less and less "stable" internally. A permanent position is an antique, and good flexibility sometimes translates into frantic to-and-fro, which is good for neither companies nor people, and often means the dispersion of talent. 

How then do we attract talented people, motivate them to choose our organization, and, when we have found them, convince them to stay with us? 

To some, this will seem like a false problem. The more cynical will say: it is very simple, just pay them more than others do. 

Money is not enough

Or is it? The studies and the most convincing analyses actually say that money is not all that is needed to attract and retain people, and to motivate them to work effectively and creatively. They are important, sure, but they are not enough to explain the choices of those who go and those who stay. 

Moreover, it is clear that for a company to focus everything on economic uplift is not convenient, and cannot be sustained indefinitely. Netflix's "top of the market" strategy, pay everyone the highest possible wage, is an extraordinary exception. Also tied to a very innovative organizational model, and a somewhat revolutionary internal work culture. It is an example that it would be nice to approach, but it is not within everyone's reach. 

Most of our companies and the companies we deal with will much more often find themselves in a different situation than Netflix. No matter what we do, somewhere, in the world, there will always be another organization willing to pay more for that person who is critical to us.

For this person to decide to stay with us, the promise of salary must be combined with other forms of motivation: the culture, the work environment, the beauty and ambition of projects, the strength of ideas. 

Give me a good reason 

So, how are money and motivation connected? 

We could be formulate like this: money is not a decisive motivation for choosing to work in a place, or for deciding to stay there. However, they are sufficient motivation to choose to leave the place where you work. 

In recent years, there has been a proliferation of services and communities where people exchange advice about work, and particularly about wage balances, to understand who is underpaid.

Simply put, if a person feels or realizes that they are not being paid as much as they thinks is fair, sooner or later they will leave. 

And what does "right" mean in these cases?
Basically, two things:

  1. Fair with respect to the market: if people in similar companies who do similar work are paid twice as much, we have a problem; we will have a company full of people who can't wait to go work for those other companies;
  2. Fair with respect to colleagues: if someone notices, or even suspects, that they are being paid less for the role they hold, the responsibilities they have, their ability to solve problems, manage a project, or make a team work, we have a problem; that person will also try to leave whenever they get the chance.

Let's talk about money

In general, organizations deal with these kinds of problems by refusing to address them - the solution is to never talk about money. Money, salaries, deals become a cultural taboo, and asking someone how much they earn is considered an indiscreet, unseemly question. Those who are asked, may take offense or imagine dark motives and secret plots. In such a climate, discontent and dissatisfaction can proliferate even if there is no serious imbalance: it is the opacity itself, the lack of transparency that creates suspicion and spoils the environment. 

For all these reasons, in I MILLE, we tried to approach the issue in a completely different way. We decided to make all salaries transparent and verifiable by everyone at any time. 

[matrix image]

We created the matrix you see above: it includes all professional levels, from internships to C-suites and partners. We have associated a salary range with each level. In this way, everyone within the organization always knows what level they are in, and what level others are in. And they can always check what possible path lie ahead, and what is the path of others.

There are two different matrices, because up to the P3 level we mainly assess "on-the-job" skills. So, experience acts as a filter, even though, as you can see, it is not determinative, but purely indicative: what we are saying is that to move to P2, you need to have a couple of years of work behind you. Then hard skills are assessed, the ability to manage complex projects and the ability to build a work process, not just implement it.

The Leadership Team matrix, on the other hand, is based on more attitudinal parameters: we assess attitude at work, level of mentorship, accountability, and also the ability to make the business grow.

Starting from the "Lead" level, it is possible to access variable compensation, which never exceeds 18% of the RAL and, most importantly, is not tied to personal goals/objectives, but always to group targets.

Breaking the taboo  

This is how we try to motivate people who work with us to remain in a transparent environment, where choices are readable and understandable. At the same time, we would like to contribute to the general clearing of the talk about money and salaries. We would like to help break this taboo,

 and make sure that such vital information for an organization's existence and people's well-being is freely shared and circulated. 

Injustices, imbalances and inequalities in our country - more than elsewhere - are also fueled by the fact that there is a taboo on money. Lack of transparency rarely favors those at the bottom of the social pyramid: rather, the lack of shared information has always favored those in power

In the next episode of WIP, we will also show the system we came up with to move from one level to another: a horizontal, participatory system based on peer reviews that disrupts the all-vertical mechanism of promotions and raises. 

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