Tuesday, September 20, 2011

The $10,000 Pen

When I was working for a start up in Silicon Valley, we went under. It was called the dot com bomb, or dot com crash. A brief side note--it's not a selling point that you're CEO has been hit by lightening twice, as ours had been. Once is understandable, but twice is basically either stupidity or egging on the fates (or both). Whichever it was, it totally caught up to us.

Miraculously, 13 of us from the company that closed its doors were purchased with our technology and brought to work for a wharehousing company that wanted to be able to provide e-commerce sites to their customers.

When hired, we were promised our original rate of pay. Some got bonuses. I got a typo. A very nice typo--I was make A LOT more money than I had been making, and I didn't correct them.

Three months later came the first pay cut. Everyone grumbled--it was 10%; I did ok, as I had the typo. I was making less, but still more than I had originally been making.

At six months, the managers took another pay reduction.

On our one year anniversary, we were all gathered into a room for a party--we celebrated and laughed and talked about how miraculous that we had made it after the previous .Com fell. Then we were thanked for our service.

Then they announced another 10% pay cut.

Finally, they handed us all a pen as a present for our one year of service. I carried it reverently--even with my typo, that pay took me $10K less than I had been making at the previous company. I thought about taking it out back and running over it, since running over the new management was not an available option.

Basically, the point of the story is that what you do and how you do it set the tone for how people feel about you and the company.

Take the first paycut: a solid, sympathetic meeting explaining that certain contracts had not come through (or any convenient lie) and a reach out by the HR team to talk about our feelings and make us at least settled with our cut would have made us feel like part of the team, doing our part (although reluctantly) in keeping the company that kept us afloat, afloat.

I was a lead, and not a manager. I imagine the manager cuts sucked, but they didn't say much about them, so I cannot speak to how they could have been done better.

I can imagine the last round of paycuts could heartily have been managed better. Step 1) Meeting about pay cuts. Address concerns, fears, and thankfulness the company decided to reduce pay rather than lay anyone off. 2) Separate party thanking us for stayinng with them for the last year, despite the difficult times, and being told we were appreciated. Finally, acknowledging a pen is not equal to a paycut, but that they wanted to show us, in some way, that they appreciate us, even if they could not do it with the monetary recompense they would like.

Tada! It still sucks, but then everyone's still on the same side.

The way they handled it, however, made it very "us" v. "company." Our lead dev started doing 80% of his work, because that was what he was being paid. We lost two people almost immediately after their talks with management were not "Here's what is happening and why we had to lower your pay" but "No, there's no possibility of an increase, you should be happy you have a job."

The morale of the $10K pen story is that how you present things to people may not be the way they see them. When you are delivering news--especially ambiguous or bad news--you need to be honest with people AND appreciative of the work their doing in praise and words...not just a cheap pen.

As the manager, you typically have little control over random finance changes, like across the board paycuts. But much like a third grader may not be able to control a bully telling her she's ugly, she (and you) can control how she reacts to the unpleasantness and form a reaction of her own making. It is important to the third grader for her eventual maturity, and it's important to you as a manager if you want your team to continue to be happy, let alone stick around and work together.

Sometimes you can't stop the company from making itself the "bad guy" through policies and actions. But you, yourself, can be allied with the employees, per their perceptions, and make a much better work environment out of something, no matter how lousy it may get.

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