Since the beginning of this century, a remarkable feature of domestic business circles is that more and more enterprises have obviously accelerated the pace of implementing the "going out" strategy and have more substantive connotations. However, the internationalization of enterprises is extremely difficult, and the first constraint is the talent problem. There are a large number of international talents to participate in international competition, and there is no modern enterprise mechanism to attract, cultivate and retain talents. How to reasonably reflect employees' work performance and let employees feel the sense of fairness and accomplishment in development? How to formulate a reasonable salary system, so that enterprise strategy and talents can develop harmoniously?
"In order to compete for software engineers and information technology professionals, we have to do our best every day. We are facing a seller's market, "Richter said. Andrew. Dr Richter is the head of compensation in IBM's Enterprise Systems, Personal Systems, Software and Technology Group.
From 1995 to 2004, IBM carried out a major reform on its overall compensation model. Among them, the "total compensation system" helped the company change its corporate culture, and thus launched a more powerful competition for information technology talents in the 2 1 century.
For IBM's comprehensive transformation in the past few years, and CEO Louis. Guo Shina (Lou Guo Shina? How to join IBM and help it successfully transform has been reported by the media. However, people have not realized the role of total compensation strategy in the transformation of "Blue Giant".
"If you can't attract talents, you can't do this business" —— Design different salary models.
The transformation of IBM began in the mid-1990s, when Guo Shina took the helm and helped IBM stop its free fall in the information technology market. Richter said that Guo Shina is trying to revive and reposition its corporate culture. This means designing different career and salary models.
"If you can't attract talents, you can't do this business." When talking about the challenges faced by the company in attracting and retaining important information technology talents, Richter said.
As a result, IBM broke the original salary pattern and gave managers a "big pot of money" to decide the salary. We treat them like adults. What was the result? It really works. Generally speaking, we firmly rely on managers at all levels to make important salary decisions, and they never let us down. "
Stock option is "the hard currency of talents in our industry". In this regard, IBM insisted that not all employees should hold options, but the company began to distinguish which employees should get options.
"When we interview new employees, we will ask, what is the purpose of your job and why do you want to work at IBM? We don't want to lose the best talents. " Richter said.
Enterprises need to attract, retain and motivate talents to succeed. Comprehensive compensation system is a tool that can strategically integrate various elements of enterprises to achieve this goal. The basis of comprehensive salary system is salary and welfare, which occupies a considerable proportion in this system.
The "work experience" part of the overall salary system has been fully utilized. Together with the salary and welfare plan, it constitutes a perfect overall salary system model that is most suitable for enterprises to design for employees.
Regarding IBM's total compensation strategy, Richter said that the purpose of this strategy is to provide a whole set of compensation, and its total amount and distribution ratio are the best. ?
For Big Blue, this shift has brought three goals of total compensation:
Changed the company culture and induced the behavior that the company wanted to see;
Attracting and retaining talents;
Control costs.
But it is worth noting that "the main challenge of total compensation is that in order to achieve these three goals, it may sometimes lead you in conflicting directions." Richter said.
"In order to survive, we have taken great risks in the way IBM operates. But you must realize that most employees may leave the company at any time. This is the market situation we are facing, "Richter said.
"Our size is our strength and our weakness." -The difficulty of changing the company culture
One of the biggest challenges facing IBM is to overcome the status quo. People think that every employee of Blue Giant must wear a blue suit, a white shirt and a tie. Richter pointed out that it is difficult to change any culture, because "values, attitudes and behaviors are so ingrained in an organization that people seldom pay attention to and discuss these things."
The overall size of IBM makes cultural change particularly difficult. In so many countries and regions, it is difficult to make everyone happy by running so many enterprises and employing so many people. "Our size is our strength and our weakness."
One aspect of cultural change is quite obvious, that is, different salaries and benefits, different types of positions, different levels of personal performance, and different salaries. Richter said that if the remuneration that can be distributed has always been a fixed number, then it is obvious that any change in rules and distribution procedures will only make some people happy, while others will not be so happy. Given the scale and diversity of IBM's global business, this fact will be magnified.
However, in any case, IBM kept the right direction, and greatly reformed the overall compensation model from 1995 to 2004.
"The allocation of options is based on the future, possible contributions, not past achievements"-the stock factor
Another major change in IBM's salary reform is the allocation of stock options. Previously, it was limited to senior managers, but in the past five years, the proportion of employees receiving stock options has increased by 10 times.
"Our stock plan is a key part of our strategy to attract and retain talents," Richter said. He pointed out that stock options are allocated to retain talents with key technologies, not to serve employees or improve the company's level. "The allocation of options is based on possible future contributions, not past achievements," he said.
He believes that IBM will continue to expand the use of options among employees and new employees, and the standard for allocating options will still be determined by market prices.
"Those factors that can attract and retain talents may not motivate employees, and vice versa" —— The role of work experience in salary
Richter pointed out that the definition of work experience is an effective way to examine the total salary. He also said that in IBM, work experience is a key factor in the overall compensation strategy (as well as salary and benefits).
"We found that those factors that can attract and retain talents may not motivate employees, and vice versa. Work experience is a dominant factor in salary, and if we ignore it, it will bring us losses, "he said." "
Richter said that positive work experience "is an important proof that IBM is a desirable workplace."
In its mode, IBM uses the following methods:
Recognition-In this regard, the company offers various recognition rewards, including reciprocity? Point to point? And provided by management? Produced by management? Reward.
Work-life balance-Richter pointed out that the company's "work-life project" is the central link of its work/life plan, but the company also offers many other options.
Culture-Richter said that in this respect, the change is significant (blue suits are no longer needed) and subtle (IBM people's views have changed). He also pointed out that the company focused on building leadership through the "senior management team" appointed by Guo Shina. Richter also mentioned the company's award-winning diversification projects.
The development of IBM is proud of its leading position in the field of e-commerce, and the use of network infrastructure to make use of knowledge management, and to maximize the company's technology in spreading knowledge and career planning.
Environment-this involves many aspects, including challenging work, clear vision, working environment and tools and resources needed for success.
"Although we are competing with some companies with extremely fat pockets, we can still attract truly outstanding talents. We must continue to strive to provide challenging jobs, self-management and workplaces where people can play a role. If the work experience is not good, it will immediately appear in our brain drain figures. "
"This is a major business decision, and you must work closely with other departments for better management"-Labor cost management
IBM paid the price for rebirth. In 2004, the expenses related to wages and benefits increased from $65,438+0,993 to $265,438+0, reaching $50 billion. The proportion of salary and welfare in total income has also increased, and may continue to increase.
"Our labor costs are rising rapidly, but these figures are still appropriate," Richter said. "Our services and software businesses are growing rapidly, both of which are labor-intensive and knowledge-driven. The complexity of labor cost management is deepening. "
However, he pointed out that the overall labor cost management is not only the responsibility of the company's salary and welfare team. Process management, team management, personnel recruitment, finance, talent and other departments are involved.
"This is a major business decision, and you must work closely with other departments to better manage it. Total labor cost management must become a basic management tool, whether at the enterprise level or in business departments. You have to ask yourself, how can you make better use of the money in the budget? And how to get the best return with our investment? " Richter said.
postscript
Challenges still faced
After the reform, IBM's salary system has the following changes:
From "popular" salary and paying attention to internal balance to differentiated salary and market-oriented salary; From being full of bureaucracy and determined by rules to paying attention to discipline and flexibility; From "merit" to "contribution"; From step by step promotion to personal development space; From the welfare of paternalistic management to the choice and sharing of costs
Although IBM's efforts continue, total compensation management has drawn a new road map for the company.
"We are in a rapidly developing industry, and the talent market in this industry is the seller's market. We have experienced such a special situation that IBM had to choose between creating a special and highly flexible compensation system and divesting its business, so that we could survive. We used to face difficulties and had to sit down and communicate well to solve real business problems, "Richter said.
But this does not mean that anyone can easily solve the problem by adopting comprehensive compensation strategy.
"Comprehensive compensation is difficult to make clear in one sentence. It is actually a summary of various thorny and intertwined issues, which are related to the basic methods of managing enterprises and creating value-added human resources, "he said. "Total compensation also involves cost and investment management. Most companies often ignore this point and always regard the salary and human resources departments as the company's backup departments. "
"265438+the most expensive in the 20th century" can't be bought by money.
At present, with the increasingly fierce competition for talents, many enterprises lament that their strength is not as good as others, and they can't afford a lot of money to attract and retain outstanding talents. It seems that without money, enterprises themselves can only admit defeat, and are generally prepared to talk at the second, third or even fourth-rate level to maintain or survive. Then, in addition to fighting for money, is there really no weapon to attract, retain and motivate employees? Conversely, as long as there is money, can enterprises sit back and relax in employee management?
Of course, we can't deny that money is indeed very important in attracting talents, but its role in retaining and motivating talents is greatly reduced.
In a 25-year study involving 80,000 managers and 1 10,000 employees, Gallup Company came to a conclusion that employees came to a company and left a boss. That is, what attracts employees to a company is the company itself, including its salary and brand. The reason for leaving the job is because of the superior, that is, the most important reason for leaving the job is that you are unhappy working under the superior. At this time, people are obviously not pure rational people who make flow decisions entirely based on economic income, but regard unpleasant work emotions as high-cost utility maximizers.
Gallup's research results coincide with the views of the American Compensation Association (WAW) to some extent. The focus of IBM's salary reform has been extended from simple salary and welfare to comprehensive salary system, and the concept of work experience has been introduced. In its view, the rewards employees get from working in an organization include not only monetized salaries and benefits, but also another more important thing, namely, work experience, that is, the respect, happiness, value and progress employees experience during their work.
After gradually getting out of the crisis from the reform of salary and welfare system, IBM has been vigorously promoting the new practice of comprehensive salary system in recent years, especially making a lot of innovations in recognizing employees' contributions, maintaining work-life balance, building corporate culture and employee development, so that IBM can still maintain its strong attraction to outstanding talents when competing with some enterprises with equal or even stronger strength, such as Microsoft.