The document contains several blog posts from the "Compensation Cafe" between January and June 2011. The posts discuss topics like a home workout program called P90X, developing compensation philosophies that can adapt to changing business needs, creating new music within established structures, using a "farmers market strategy" for total rewards programs, ensuring compensation goals support overall business success, advocating for executive pay transparency, viewing compensation as analogous to baking cupcakes, and communicating compensation programs effectively.

1. January - June 2011
MUSINGS ON PERFORMANCE AND COMPENSATION
LOCATION: COMPENSATION
CAFE DATE: JUNE
22,
2011
The
P90X
Workout
and
Effec)ve
Performance
Compensa)on
I
like
finding
unique
training
tools
for
compensaBon
professionals.
My
newest
addiBon
is
the
P90X
training
system.
For
those
of
you
who
have
not
tried
it,
or
seen
the
infomercials,
I
should
describe
the
program.
An
individual
works
out
at
home
using
a
series
of
DVDs
that
guide
them
through
varying
daily
exercise
programs.
The
sessions
are
lead
by
a
dynamic
leader
named
Tony
Horton.
Tony
is
in
great
shape
and
has
very
high
energy.
The
program
is
very
intense
and
requires
a
level
of
personal
commitment
MORE...
LOCATION: COMPENSATION
CAFE DATE: JUNE
14,
2011
A
Founda)on
Like
a
Ship,
Not
a
Building
This
concept
came
to
me
at
a
recent
compensaBon
philosophy
engagement.
During
an
employee
interview
session
I
explained
that
the
compensaBon
philosophy
would
become
the
foundaBon
for
new
compensaBon
programs,
pay
levels
and
strategy.
The
very
astute
employee
chimed
in
and
asked:
“We
have
a
new
CEO
and
we're
expanding
into
new
business
lines
and
markets.
Won’t
a
strong
foundaBon
anchor
us
to
where
we
are
right
now?”
MORE...
LOCATION: COMPENSATION
CAFE DATE: JUNE
1,
2011
They
S)ll
Create
New
Music
with
the
Old
12
Notes,
You
Can
Do
the
Same
with
Compensa)on
The
basic
scale
used
in
western
music
incorporates
12
notes.
The
scale
has
only
five
lives
(staves).
This
combinaBon
of
a
simple
structure
and
limited
elements
has
been
essenBally
unchanged
for
hundreds
of
years.
Somehow
new
music
is
created
every
second
of
every
day.
These
limited
components
have
given
us
Beethoven’s
“9th
Symphony”,
Gershwin’s
“Rhapsody
in
Blue”,
John
Lennon’s
“Let
it
Be”
and
literally
MORE...
LOCATION: COMPENSATION
CAFE DATE: MAY
19,
2011:
Total
Rewards
and
a
Farmers
Market
Strategy
It
is
fact
that
poor
food
choices
lead
to
poor
health.
Of
course,
there
are
many
other
contributors,
but
when
food
is
bad,
health
almost
always
follows.
In
the
United
States,
bad
food
is
oen
cheap
food.
We
have
found
ways
to
feed
our
country
more
while
providing
less
of
what
is
truly
needed.
People
don’t
starve,
but
neither
the
body
nor
the
brain
can
operate
at
peak
performance.
We
find
ways
to
keep
people
alive,
but
is
it
really
helping
them
thrive?
In
the
end,
this
short-­‐term
soluBon
creates
too

2. MUSINGS ON PERFORMANCE AND COMPENSATION
LOCATION: COMPENSATION
CAFE DATE: MAY
10,
2011
Are
Your
Compensa)on
Goals
GeVng
You
to
the
Top
of
the
Wrong
Mountain?
So
oen
we
see
companies
whose
execuBves
are
paid
handsomely
only
to
falter
shortly
aer.
How
does
this
happen?
Goals
were
apparently
met.
Success
seemed
to
have
been
achieved.
But
the
final
result
of
the
goals
and
success
is
a
large
payout
followed
by
a
sharp
corporate
collapse.
Are
we
doing
something
wrong
when
we
incenBvize
our
execuBves?
As
the
evoluBon
of
Dodd-­‐Frank
and
mandatory
Say-­‐On-­‐Pay
quickly
impacts
execuBve
MORE...
LOCATION: FORBES
EXECUTIVE
PAY
WATCH DATE: MAY
3,
2011
Companies
Deserve
Pay
Transparency,
Too
ExecuBve
compensaBon
is
jusBfiably
complex.
In
fact,
the
total
compensaBon
for
nearly
everyone
in
this
country
is
difficult
to
communicate.
Those
at
the
highest
corporate
levels
generally
have
pay
structures
that
reflect
the
complexity
of
their
company.
Regardless
of
the
intricacy
of
execuBve
pay
programs,
it
is
sBll
a
very
reasonable
request
to
ask
for
pay
transparency
from
these
publicly
traded
firms.
New
disclosure
rules
have
taken
another
step
or
two
up
the
ladder
towards
percent
to
MORE...
LOCATION: COMPENSATION
CAFE DATE: APRIL
25,
2011
Icing
is
Nice,
but
Fros)ng
is
Essen)al
(Compensa)on
is
like
Cupcakes)
How
is
compensaBon
like
a
cupcake?
Is
it
just
that
people
crave
it,
or
is
it
something
far
more
fundamental?
I’d
like
to
suggest
that
it
is
in
understanding
the
important
difference
between
frosBng
and
icing.
Think
about
generic
plans
created
from
stale
boilerplate
documents.
Or,
communicaBon
programs
which
teach
lihle
and
inspire
nothing
beyond
high-­‐level
overviews
or
lengthy
legal
documents.
Or,
even
sales
compensaBon
plans
promising
MORE...
LOCATION: COMPENSATION
CAFE DATE: APRIL
19,
2011
Are
You
Pushing
the
Wrong
Rock
up
the
Hill?
We
all
know
the
story
about
Sisyphus,
the
man
who
was
sentenced
for
eternity
to
roll
a
stone
up
a
hill
only
to
have
the
stone
roll
back
down
and
begin
again.
I
have
been
speaking
to
compensaBon
professionals
recently
who
seem
to
have
assigned
themselves
this
same
punishment.
In
one
case,
I
recently
spoke
to
a
company
who
has
placed
communicaBons
at
the
top
of
their
“needs”
list
each
of
the
last
few
years.
They
are
fully
aware
that
their
MORE...

3. MUSINGS ON PERFORMANCE AND COMPENSATION
LOCATION: COMPENSATION
CAFE DATE: APRIL
8,
2011
Curiosity
May
Kill
Cats,
but
It
Saves
Compensa)on
Professionals
Do
you
ever
wonder
why
you
are
reading
this
arBcle?
No
one
is
paying
you
to
read
this.
Your
boss
will
probably
never
even
know
that
you
read
it.
Why
take
a
few
more
minutes
out
of
your
busy
day
for
something
that
only
you
truly
value?
The
answer
is
simple.
You
are
a
curious
person.
(Fair
warning
this
is
a
“so”
arBcle
with
no
staBsBcs
or
compensaBon
rules)
We
are
always
told
that
curiosity
kills
cats.
The
theory
is
that
it
gets
cats
into
trouble
MORE...
LOCATION: COMPENSATION
CAFE DATE: MARCH
28,
2011
Compensa)on
is
a
Balancing
Ac)on
(Not
an
Act)
Have
you
ever
used
one
of
those
workout
things
called
a
“Bosu
Ball”?
A
Bosu
Ball
is
half
a
workout
ball
ahached
to
a
round
plasBc
plalorm.
Many
people
workout
standing
on
the
so,
round
ball
side.
My
trainer
turns
it
upside
down
and
makes
me
stand
on
the
flat
plasBc
side.
Balancing
with
the
round
side
on
the
floor
requires
concentraBon
and
constant
adjustments.
Add
some
basic
weights
or
movements
and
the
process
makes
you
stronger,
while
exhausBng
you.
The
trick
is
making
frequent
MORE...
LOCATION: COMPENSATION
CAFE DATE: MARCH
16,
2011
Compensa)on
and
Loyalty:
The
Head
and
the
Heart
Recently,
I
was
working
onsite
at
a
client’s
office
doing
a
series
of
employee
engagement
interviews.
The
company
is
looking
for
ways
to
move
to
the
next
level
and
I
suggested
that
we
find
out
what
their
employees
were
thinking
before
we
guessed
at
any
type
of
new
compensaBon
program.
These
types
of
interviews
are
almost
always
eye-­‐opening
and
this
case
was
no
different.
On
the
bright
side,
a
steady
stream
of
employees
came
through
the
interview
room
MORE...
LOCATION: COMPENSATION
CAFE DATE: MARCH
8,
2011
What
Do
You
Do
if
You
Don’t
Like
Your
(Stock)
Op)ons
In
my
Febraury
25,
2011
posBng
“Stock
OpBon
Moving
Sale”,
I
suggested
that
rather
than
end
up
with
the
compensaBon
equivalent
of
acid
washed
jeans
or
a
teal
mock-­‐
turtle
neck,
perhaps
a
beher
shopper
could
find
deals
that
were
a
bit
less
trendy
or
even
tenuous.
Equity
compensaBon
may
be
beher
uBlized
like
a
list
of
401K
investments.
Imagine
different
tools
balancing
at
the
same
Bme
to
create
a
more
effecBve
compensaBon
package.
People
using
a
single
instrument,
like
stock
opBons,
MORE...

4. MUSINGS ON PERFORMANCE AND COMPENSATION
LOCATION: DATE:
Stock
Op)on
Moving
Sale!
Everyone
loves
when
a
business
or
a
family
down
the
street
has
a
moving
sale.
You
have
opBons
to
buy
stuff
at
a
discount
even
if
you
might
not
need
it.
Heck,
someBmes
you
purchase
something
even
if
it
might
be
out
of
fashion
by
the
Bme
you
finally
get
around
to
using
it.
You
convince
yourself
that
the
discount
jusBfies
buying
things
that
you
might
even
have
owned
and
found
not
to
work
in
the
past.
Maybe
this
Bme
that
type
of
skirt
will
look
good
on
you.
Maybe
this
Bme
you
will
lose
the
weight
and
be
MORE...
LOCATION: COMPENSATION
CAFE DATE: FEBRUARY
14,
2011
Enough
is
Enough.
Knowing
When
to
Say
When
on
Compensa)on
SomeBmes
enough
is
enough.
I
had
a
client
go
through
a
surprisingly
good
experience
last
week
that
made
me
realize
the
posiBve
context
of
this
cliche.
Aer
several
years
of
being
beaten
up
by
insBtuBonal
shareholders
about
equity
compensaBon
burn
rates
and
usage,
they
are
now
in
a
posiBon
to
ask
for,
and
get
approved,
more
shares
than
they
have
used
in
the
past
3
years.
Here’s
the
interesBng
thing,
they
won’t
be
asking
for
it
all...
Yes,
Virginia,
there
is
a
company
who
shows
restraint.
MORE...
LOCATION: COMPENSATION
CAFE DATE: FEBRUARY
4,
2011
In
a
Vacuum
of
Informa)on
People
Will
Use
Imagina)on
I
love
talking
to
employees
about
their
compensaBon
plans.
It
is
always
easy
to
see
the
people
who
work
at
companies
with
effecBve
communicaBon
programs.
Whether
the
staff
likes
or
dislikes
the
plans
they
tend
to
provide
similar
details.
They
generally
understand
the
components
of
the
programs.
And
they
have
an
idea
of
what
it
takes
to
progress
within
them,
earn
something
from
them
or
otherwise
take
advantage
of
them.
If
I
have
to
be
honest,
my
favorite
employees
are
at
the
companies
that
have
a
MORE...
LOCATION: COMPENSATION
CAFE DATE: JANUARY
25,
2011
What
Do
Your
Employees
Really
Think
About
Pay?
Last
Friday
I
was
in
the
final
stages
of
ediBng
when
I
came
across
the
exchange
of
messages
below
posted
on
a
social
networking
site.
All
messages
were
posted
within
about
an
hour
of
each
other.
Employee
1:
Morgan
Stanley,
which
is
the
owner
of
the
world's
largest
brokerage,
cut
the
investment
bank's
compensaBon
pool
2%
last
year
to
$7
billion.
Morgan
Stanley's
MORE...

5. MUSINGS ON PERFORMANCE AND COMPENSATION
LOCATION: COMPENSATION
CAFE DATE: JANUARY
17,
2011
You
Can
Self-­‐fulfill
a
Prophecy,
Just
Ask
the
Right
People!
I
just
read
two
recent
arBcles
explaining
that
nearly
every
single
employable
American
will
be
looking
for
a
new
job
in
2011.
Perhaps
as
many
as
98%
of
all
Americans!
To
tell
the
truth
I
was
shocked.
First,
I
gnashed
my
teeth.
Then,
I
pulled
my
hair.
I
panicked
when
I
realized
what
a
drain
this
would
be
on
companies.
It
seemed
as
if
we
were
all
going
to
go
through
the
tumultuous
year
in
our
lives.
Just
as
I
was
about
to
hypervenBlate,
I
looked
at
the
source
of
the
informaBon.
MORE...
LOCATION: COMPENSATION
CAFE DATE: JANUARY
5,
2011
Execu)ve
Pay
and
the
Emperor's
New
Clothes
I
read
a
recent
arBcle
by
Dan
Ariely
on
how
we
measure
thri.
Mr.
Ariely,
is
the
author
of
“Predictably
IrraBonal”
and
“The
Upside
of
IrraBonality.”
He
is
also
a
professor
of
Psychology
and
Behavioral
Economics
at
Duke
University.
He
used
a
simple
example
of
how
we
may
choose
to
purchase
expensive
premium
coffee
over
less
expensive,
but
sBll
good
coffee,
to
show
how
seemingly
reasonable
decisions
can
be
influenced
by
past
experience
rather
than
current
facts.
In
the
end
he
quesBons
whether
some
of.
MORE...
LOCATION: DATE:
Dan
Walter
is
the
President
and
CEO
of
Performensa5on
an
independent
compensa5on
consul5ng
firm
focused
on
the
needs
of
companies
not
in
the
Fortune
1000.
Dan’s
unique
perspec5ve
and
exper5se
includes
equity
compensa5on,
execu5ve
compensa5on,
performance-­‐based
pay
and
talent
management
issues,
Dan
is
on
the
board
of
the
Na5onal
Center
for
Employee
Ownership,
a
partner
in
the
ShareComp
virtual
conferences
and
the
founder
of
Equity
Compensa5on
Experts
a
free
networking
group.
Dan
is
frequently
requested
as
a
dynamic
and
humorous
speaker
covering
compensa5on
and
mo5va5on
topics.
Connect
with
him
on
LinkedIn
or
follow
him
on
TwiNer
@performensa5on.
LOCATION: DATE:
All
ar)cles
authored
by
Dan
Walter
President
and
CEO
Performensa)on
Consul)ng,
LLC
514
Precita
Ave,
Suite
100
San
Francisco,
CA,
94110
415.625.3406
(direct/mobile)
|
415.821.9883
(fax)
dwalter@performensaJon.com
|
www.performensaJon.com
www.compensaJoncafe.com
|
www.linkedin.com/in/danwalter
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2011
PerformensaJon
ConsulJng
LLC.
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Rights
Reserved