Brian Buckley, the Vice President of B2B Sales at Barnes&Noble.com has a great formula he uses to explain how an employee evaluates their job – whether they are coming on board, staying, or deciding to leave. With his permission (thank you Brian), here it is:
F + E + W = P
Future + Environment + Work = Pay
Anyone who has been a boss will come across some variation on this kind of formula, either through word of mouth, journal articles or pure contemplation. What’s nice about Buckley’s version is its succinctness and simplicity — and it accurately represents the calculus that people make when looking at their job. The formula literally sums up how a person evaluates their job, with the nuance of placing the “Pay” component as an algebraic sum that is traded-off with the other variables, the key elements of a job.
Let’s go through the four elements:
FUTURE : This is the big-picture element, where an employee reflects on whether a given organization is a place where they want to invest themselves into. Questions include:
ENVIRONMENT: The Environment element is a big one. This includes a number of sub-categories:
WORK: Ah, the work itself. This is where you ask yourself: What do I do every day? Do I enjoy it? Does it feel purposeful? Is this rote work or am I being challenged? Is my function too narrow in scope? Can I bring up new ideas? Is every new idea crushed? A lot of people hate their jobs and hate the work they do… but they do it for 40 years!
Finally, on the flipside of the equation, PAY: There is an interesting dynamic when it comes to pay. Sometimes the pay can become less important than the job. On the other hand, people are willing to put up with a lot of crap for money. As an independent e-commerce consultant, I’ve dealt with some pretty abusive folks over the years – I quickly learned that the best psychological armor was to charge a very, very large fee whenever I met someone who seemed like a Big Jerk (and they were always willing to pay — I guess they became conditioned over time because others have been making this same calculus) . Of course, I ultimately ended up switching over to a better environment anyway. Brian Buckley describes how AMEX went to virtual offices at one point, which was a boon to lots of moms in the sales force who wanted to be near their kids. AMEX was able to retain these individuals despite lower pay.
The message is clear: Companies can save money by working on all the variables on the left side of the equation. Want a quick fix? Try addressing those variable by instituting a solid employee onboarding process. No, handing an new hire a pile of papers, a Starbucks gift card and a making them sit through a bunch of meetings and presentations for 2-3 days is NOT an onboarding process. That’s called “orientation,” and even then, just barely. Onboarding does not need to be complicated, or rather, it can be started with a few simple steps. Once again, I’ll have to save this topic for another time. Let’s wrap up this analysis of the Buckley Formula.
One of things that I like about this formula is that it reconciles pretty well with the classic Motivator-Hygiene theory of Frederick Herzberg, a management theory that is predictive of long term employee retention (and “long term” is a relative term, depending on the intensity of the job). What the Buckley Formula says to me is: “Yes, according to Motivator-Hygiene theory, the size of the paycheck is not a motivator for in the long run. Yet the common sense, short term reality is that an employee’s pay really does form a major role in their decision to stick with a company… in balance with the other, true motivational factors.” Being a veteran of the war-for-talent-dot-com-insanity, running a company or career on Motivator-Hygiene theory alone always seemed a bit dubious to me. There’s the long term, and then there’s the short term… not to mention the medium term.
A challenge to employers is to find ways to improve on the F.E.W. factors — Future, Environment and Work – so that they don’t have to rely just on Pay to keep their people motivated. I’ve seen a number of executives who believe all they have to do is bluff about those factors and make a good “sales pitch” to potential hires. Of course, the truth always emerges, and what then happens is that their organizations suffer from high turnover rates and a high sense of employee entitlement. They waste money (often their investors’ money), time and potential because they don’t look at ways to make a sustained improvement of small investments that have a big payoff.
But let’s not dump all the responsibility on the employers. All of us (well, most of us) are employees, sometime, somewhere. So along with the challenge to employers in the previous paragraph, I’ll issue the following challenge to employees as well: Which of the equation’s variables can you, the employee, control or contribute to yourself?
Thanks again to Brian Buckley for sharing this lovely little equation.
Filed under: Business, Career, Cool Companies, Learning, LinkedIn
I have a doubt.. How can an employee be evaluated linking to the performance? eg: We assign a work to the employee.. and give him a time frame.. (say 2 hours) if he does that in 1 hour we have to say his productivity is 200 percentage..
IS there some other work around for this?
facts;
total work hours : 8 hours
Assigned hours = what we assign to employee
actuals = what they take to finish the work.
Hi Vishnu — Employee evaluation is a vast topic. You want to come out with Key Performance Indicators (KPIs) for each employee that align well with the business’ goals (e.g., product/service quality, social contribution, customer retention, margin, market share, profitability, etc.) .
On a narrower level, the particular example of performance evaluation you describe is the age-old question of employee productivity. For this you must measure all the inputs (mostly the employee’s own time, but can include other resources, such as capital invested, training, overhead utilized, other people’s time, etc.), and then measure the outputs (qualitative and quantitative).
Wikipedia has a pretty good description of this here: http://en.wikipedia.org/wiki/Labor_productivity
Now, my post was about evaluating jobs, and I suppose one could turn around many of these economic Labour Productivity models and apply from the employee’s perspective, i.e., ‘For my effort required, what do I get from this job versus another job?’ A great question to ask, if you’re in the position to ask it!
Thanks a lot for the reply dear. I think I need to do a lotta research in this. but first I would go ahead and measure the time factor alone, and slowly add in the other factors and weighted factors based on the cost / salary parts.
Trial and error method with constant improvement is the best way.
Thanks again