Monday, June 8, 2020

Vile and Obscene: Compensation Based on Local Cost-of-Living

The New Virtual Organization World
It's a New Principled and Civilized World, It's Virtual, and It's Organized

Vile and Obscene: Compensation Based On Cost of Living

It is very refreshing and heartening to hear that COVID-19 has all of a sudden caused a lot of "Brilliant, Forward-Thinking, Innovative and Visionary" CEOs and other Leading Corporate Executives (Forbes Global 2000 and other Global 5000 executives across the globe)  to pause and reflect on the importance of "being able to work where you are" for quality of life reasons.  

Recently, one of them even stressed the need to expand their company's access to an exponential global talent pool  by allowing these individuals to work wherever they are.  

That way, organizations worldwide get to kill two birds with one stone.

Of course, I was enjoying the humor and having a good laugh since I know from personal experience and observation over the past 47 years that there is absolutely nothing "brilliant, forward-thinking, innovative or visionary" about 95% of the aforementioned executives.   In fact, they wouldn't know what these words really mean even if the definition were etched on a large video screen in front of them.   
Why is that, you might say?
Well, I know that sounds very harsh, however, that is the honest to god truth.   It's not because they are stupid.   It's just that being "brilliant, forward-thinking, innovative and visionary" is  NOT part of their job description.   In fact, they can ill afford to be for the simple reason that such attributes, or display thereof,  would jeopardize their lucrative career and livelihood.  These are strictly accolades bestowed upon them when everything is going well and shareholders are happier than a pig in mud.
Their real job description is to create and maximize shareholder value - in the short term.  Should anyone tell you any different, they are being disingenuous, at best, or are merely trying to insult your intelligence.
In any case, my enjoyment of the humor did not last long.   That is, of course, until I came across the final part of an article which stated that  such brilliant, forward-thinking,  innovative and visionary Remote Workforce Initiative would be tempered with "Compensation Based on Local Cost-of-Living."

At which point, it was no longer a laughing matter; the smile disappeared completely off my face; and the only thing I could think of is, "How long did it take these clueless and remorseless vermin :: sitting in their corporate ivory towers and without an ounce of conscience :: to come up with such a vile and obscene proposal and policy?"   

Why The Outrage?

Well, just in case you are thinking, "But Pierre, compensation based on local cost-of-living has been standard fixture both informally and formally for nearly a century here in the United States and throughout the world, so why are you so angry?  As well, with you being the founder of both the virtual organization management discipline and virtual organization recruitment discipline;  the world's leading advocate for Virtual Organizations;  and the world's leading and only provider of Virtual Organization Leadership solutions, one would be reasonably inclined to believe that this new development would be music to your ears,"  to which I am very pleased to reply that you came to the wrong  conclusion due to the very premises you just enunciated.    

Here are the reasons why:

Reason #1.    A Different Era.  The compensation based on local cost-of-living practices that you just mentioned pertained to a different era and totally different realities.   Realities based on just about every perspective or standpoint that you can think of (business, financial, economic, technological, logistical, legal, political, and cultural).  Unfortunately,  I am unable to go into the details since that would require a 300-page book and thus go way beyond the scope of this article.           

The bottom line is this:  There is a huge difference between a Remote Workforce Initiative versus a multinational organization operating in different countries; or a country which primarily depends on labor from a Foreign Workforce for certain industries due to a number of practical considerations (e.g., USA,  Gulf Countries, Malaysia, Singapore, Switzerland).   With respect to the latter, there are significant costs involved for these organizations and countries - although there is a certain amount of financial and economic exploitation involved with each one of them.

Reason #2.   A New Technological Era.    With respect to having a Remote Workforce and the sort of activities that are ideal for the use of remote workers,  there are practically NO material barriers in place or any significant constraints and costs incurred by an organization with respect to the decision-making  process and the implementation of such initiative.   
Regardless of geographic boundary, for certain positions, the evolution of the Internet from both a broadband and virtual collaboration technology standpoint has practically leveled the playing field for anyone who is "qualified" to work remotely.  
Reason #3.   Dumb and Stupid Move.    Therefore, NO ONE should be penalized from a compensation standpoint strictly by virtue of where they live.   The only words I can use to describe such policy is:  Sanctioned Corporate Theft and Highway Robbery of Vulnerable Employees.    

The reduction in compensation is tantamount to taking bread and butter off an employee's table because they don't have a choice.   
It's the typical robber baron mentality of "take it or leave it because we have a long line of people who are ready, willing and able to take your place."
For any member of an organization's Executive Leadership Team anywhere in the world to even contemplate such recommendation or policy, the only appropriate words I can think of to describe such person are "selfish,  inconsiderate, callous, unreasonable, unconscionable, and downright greedy."

A Level Playing Field for All

A Level Playing Field
As a matter of fact, with respect to ALL organizations which are affiliated with us as well as the services and solutions that we offer to our clients,  We REQUIRE equal treatment for ALL Candidates regardless of where they live (including compensation and benefits).   Otherwise, we will NOT accept any Virtual Organization Leadership Executive Search Assignment from them.  Nor will we offer them any of our Virtual Organization Leadership Executive Training, Assessment and Certification solutions. 

To Illustrate Our Commitment,  Here Are Some Examples:

Example #1.    Search for a Virtual Organization Leadership Executive in INDIA   

If a potential corporate client with headquarters in the UNITED STATES contacts Virtual Organization Recruiter ("VOR")  in order to submit a Search Assignment for a Virtual Organization Leadership Executive who will reside, or currently resides, in India, then prior to accepting such search assignment, VOR would request information about the Total Compensation Package and Benefits for that same position in the United States.   

As well, VOR's Search Assignment Agreement would stipulate that the minimum total compensation package to be offered to the successful Candidate in India MUST at least be equal to the same compensation  (in USD) that is offered to their Executive counterparts in the USOtherwise, we will decline such Search Assignment request.          

Example #2.    Search for a Virtual Organization Leadership Executive in the PHILIPPINES

If a potential corporate client with headquarters in GERMANY contacts Virtual Organization Recruiter ("VOR")  in order to submit a Search Assignment for a Virtual Organization  Leadership  Executive who will reside, or currently resides, in the Philippines, then prior to accepting such search assignment, VOR would request information about the Total Compensation Package and Benefits for that same position in Germany.   

As well, VOR's Search Assignment Agreement would stipulate that the minimum total compensation package to be offered to the successful Candidate in the Philippines MUST at least be equal to the same compensation (in EURO)  that is offered to their Executive counterparts in GermanyOtherwise, we will decline such Search Assignment request.

Example #3.    Search for a Virtual Organization Leadership Executive in the USA

If a potential corporate client with headquarters in KUWAIT contacts Virtual Organization Recruiter ("VOR")  in order to submit a Search Assignment for a Virtual Organization  Leadership  Executive who will reside, or currently resides, in the USA, then prior to accepting such search assignment, VOR would request information about the Total Compensation Package and Benefits for that same position in Kuwait.   

As well, VOR's Search Assignment Agreement would stipulate that the minimum total compensation package to be offered to the successful Candidate in the USA MUST at least be equal to the same compensation (in KWD)  that is offered to their Executive counterparts in Kuwait.  Otherwise, we will decline such Search Assignment request.

We Practice What We Preach

I know you are wondering why we dare to dictate executive compensation policy to our clients.   Well, we are NOT doing that at all.   They are the ones who get to dictate compensation for a particular position in their home country.  The only thing that we are doing is making sure that ALL Candidates are operating on a level playing field and are being fairly treated.    

There is another reason:  In accordance with the virtual organization management discipline, the most basic tenet and central pillar of Virtual Organization Leadership is "Do unto others as you would have them do unto you."  
I am sure as hell I would be offended and enraged if I found out that I was being paid much less than my colleagues even though we were all doing the same type and amount of work ::: just because my employer figured I shouldn't get paid too much money because I happen to live in a poor country or a country which has no appreciation for my skills and intelligence because our leaders happen to be a bunch of dumb asses and Neanderthals.    
Thus, we are only practicing what we preach.  

Third, there is NO valid reason or reasonable justification for compensating a Remote Worker strictly on the basis of where they live.   The only logical conclusion for such a policy is "pure financial exploitation" of another human being.   Hence the reason for VOR's refusal to be an accomplice to such odious and malodorous practice. 

And last but not least, ALL successful Virtual Organization Leadership Executive candidates who are offered and have accepted a position with our client will be required to participate in a fully employer-sponsored Virtual Organization Leadership Executive Training, Assessment and Certification program at our partner Virtual Organization Leadership  on or after their starting date of employment.    

Such virtual organization leadership training will emphasize the need to become "Principled Leaders."   Hence, as a matter of principles, we cannot afford to be part of anything that we strongly object to on grounds of principles even if that means losing a lot of potential clients.  Again, we must practice what we preach. 

A Simple Solution For Virtual Organization Leadership Executive Candidates Worldwide

Let's face it, if you were responding to a career ad from a US-based Forbes Global 2000 organization for a Virtual Organization Leadership Executive position in India, there is no way in hell for you to obtain any reliable information about the Total Compensation Package for such position in the US prior to submission of your executive profile and resume.   

As well,  here is some insider information you need to know:   Many superstar brick and mortar executives from Forbes Global 2000 and Global 5000 organizations have a tendency to quit their new job within 1-year of having accepted a Remote (Virtual) Executive position - especially a Leadership position which requires the supervision of subordinates in such remote workforce environment.   For the simple reason that their "less than stellar performance" in a virtual environment tends to put a blemish on their overall performance track record and thus bruise their ego when their current employer and colleagues begin to find out that "the emperor has no clothes."  
Such "less than stellar" performance can be attributed to "operating by the seat of their pants" or just plain "winging it" in their new remote leadership position the minute they find out that "what worked for them  at their previous employer" just doesn't seem to cut it in their current environment.  
Therefore, if you are planning on submitting your candidacy for a Remote Leadership position, then it is critical that such position includes a formal Virtual Organization Leadership Executive Training, Assessment and Certification program that begins within the first week of employment at your new employer.   Now you know the reason why!

But what if the reason that your new employer initially considered you for the position was based on an assertion in your resume or executive profile that you had prior experience working and/or leading in a Remote Workforce environment?   The answer to that question is very simple and honest:   "What works at Company X through "trial and error and by the seat of your pants" may not work or be applicable at Company Y.   

Thus the reason for a formal "Virtual Organization Leadership Executive Training, Assessment and Certification program for all newly appointed Remote Workforce executives.  The knowledge gained from such training is universal and can be applied anytime, anyplace and anywhere."

However, that being said, there is no need for you to be concerned with the aforementioned issues.

Here is a simple solution:   

If you find any Remote Workforce position on the internet that you are interested in, just send that employer your resume along with a Cover Letter which states that you are interested in the position;  you want to be exclusively represented by Virtual Organization Recruiter for ALL "Remote Workforce" opportunities in their organization;  and you want the employer to contact Virtual Organization Recruiter directly if they would like to consider you.   That's all there is to it! 
That's how easy it is.  There is no need for you to contact Virtual Organization Recruiter or to send them your resume.  There is no need for you to fill out any application or to sign any exclusive representation agreement with Virtual Organization Recruiter.  There is no need for you to pay any fee to Virtual Organization Recruiter.  And should the organization prefer to deal with you directly and make you an offer,  Virtual Organization Recruiter (VOR)  would not even know that you exist.  VOR would become aware of your existence only after such organization has completely met our Virtual Organization Leadership Executive Search Assignment Requirements.       
The point being, Virtual Organization Recruiter does NOT work for you.  The "virtual organization leadership executive search process" at Virtual Organization Recruiter merely ensures that ALL parties operate on a level-playing field and are represented in an honest, ethical and principled fashion. 

In Conclusion

I am clearly aware that there are many people in the world who are just content to get a job in order to feed their family and thus don't really have the luxury of taking the risk of appearing cocky or confrontational with a potential employer.   

Therefore, this article only applies to those of you who are very sure of your talents and future potential; and are totally confident about what you bring to the table.   Hence, you are willing to make sure that you are fairly compensated for your labor and contribution to the success of your future employer. 

Nonetheless, I invite you to share this article with whomever you believe it might be of great interest - employers and candidates alike.  

Let Us Manifest!

About Author:   Pierre Coupet, Q of Virtual Organization Management is the founder of Virtual Organization Management Institute (VOMI), VOMI Virtual Organization Academy,  Virtual Organization Leadership,  VOMI Global Think Tankand Virtual Organization Recruiter :: founder of the modern virtual organization management and virtual organization recruitment disciplines pioneered since 1997:: founder of League of Extraordinary Virtual Organization Executives:: and Lead Architect of Futuristic City-State Enclave Based On a Civilized World Financial SystemContact Online; or via CHAT.

Stock Photo: courtesy of Pixabay

Copyright 2007-2020.  Pierre Coupet.  VOMI. Virtual Organization Management Institute. VOMI Virtual Organization Academy.  Virtual Organization Recruiter. VOMI Global Think Tank.  All rights reserved.  Cannot be reproduced without permission.