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> pay people by the value they bring to the company upon every annual compensation review. how do you determine the value they bring to the company? Presumably
by bosie 8y ago
> pay people by the value they bring to the company upon every annual compensation review.
how do you determine the value they bring to the company? Presumably it must be a % of the revenue or valuation growth but I cannot come up how you derive the value.
- brandall10 8y agoHow do you determine the value of any candidate you interview? You have a job req. Do they match that req? Yes, good, you make them an offer. What level of pay do you negotiate? What is market. If they're otherwise happy going toward the bottom of market is feasible, esp. if it's a large bump. If this person goes out the door, you're going to be paying their replacement roughly the same as what they'll negotiate elsewhere... and on top of that, you have to deal with the cost of turnover. You basically just lost a ton of $$ by letting them walk. This is not hard. Just run the thought experiment of what it would cost to find a suitable replacement.
- scarface74 8y agoSimple. How much would it cost you to pay someone to replace them at market rates and then add the amount it would cost you to give them time to ramp up on the institutional knowledge and codebase.
- bosie 8y agoWell, not really. The phrase was specifically about how much value they bring to the company. Market rates have no meaning in this context. E.g. how is "if a team works on a product that no customer seems to use/purchase/pay for, what is the value that team brings to the company" connected to market value? I would say it isn't.
- scarface74 8y agoIf you want to keep the employee you have to pay market rates or they can easily leave. If the team works on a product that no one wants, that’s the fault of the business side. It’s up to the business to either find something for the tea to work on or let them go.
- brandall10 8y agoYou’re taking the use of that word too literally. I meant it as what perceived impact would the addition/omission of an engineer of that level have on a company? The stuff that factors into determining annual budgets.
- bosie 8y agoFair enough, thanks for the clarification.