What are you worth?

The Daily Drip

As companies switch to remote culture, leaders will have to make decisions they're uncomfortable with.

Mark Zuckerberg just announced that employees that work remotely may face a salary cut.

Of course, every business needs to cut costs. That's what being in business is.

But what's interesting is where we get the compensation number from.

Do we come up with salaries based on what other companies are paying?

Should we come up with salaries based on what housing costs in the area?

I think all of these fall short for both the employee and the employer.

The more we think about the actual value of employees, the easier it will be to pay a fair price.

What is the position or role worth to the company?

The more we focus on the actual value of the position and get less caught up with housing prices and signing bonuses, the more we can focus on what actually matters.

If you're a copywriter and you write for $25/hour, does that reflect the business value you created?

If you can claim a flat base pay and then a 30% share in new revenue, I think both the business and the copywriter will be thrilled. This is a classic win/win negotiation.

This also does 2 important things:

1. It forces businesses to scrutinize excess overhead.

I believe that hiring someone is a sign of failure. It means that you couldn't build a process or an automation that gets the job done. The only way you could solve the problem was by hiring someone. That's not a bad thing, it's just important to see hiring an employee as the last resort.

2. It forces businesses to measure effectiveness.

If you are part of an "accountability" culture at work, where, if you mess up you're fired, you're probably not going to measure/share anything. In fact, organizations with this kind of culture are notorious for launching tons of "initiatives" that never actually have lasting value, but make it really clear that people are very busy.

So, whatever Mark Zuckerberg decides to do, I think our world will be just a little bit better if we focus on new value creation instead of just turning wheels faster in a gearbox.