What Would You Do? Responses to “Disappointing News”
By John West Hadley
The Stepping Stone, March 2021
In the November 2020 issue of The Stepping Stone, I presented the following situation faced by an actuarial officer. Here are selected responses and excerpts, edited for space and clarity, followed by the real-life conclusion. (Please note that inclusion of responses should not be taken as an endorsement by either the section council or the Society of Actuaries of the positions presented.) Send your own ideas for situations to pose in upcoming issues to SteppingStone@JHACareers.com.
Greg has been assistant vice president for a number of years, and while his responsibilities have grown, his title has not. There is another FSA who he originally hired who is now a vice president in another department, and there are few assistant vice presidents at the company. While his compensation is good, his annual increases have been modest for a few years. In job discussions with Sal, his boss and a senior vice president, he is told that the only way for him to secure a larger increase is a promotion.
Greg works hard over the coming year to demonstrate his leadership skills, including chairing the company’s Officer Advisory Group through a sensitive restructuring/downsizing analysis. In the fall, the secretary to the company’s general counsel calls him to confirm the exact wording of the new vice president title that is to be announced at the upcoming board meeting. He tells her he didn’t know the promotion was coming, and she apologizes and swears him to secrecy.
Greg is excited. After the meeting, Sal comes to give Greg the good news, telling him that he has been promoted to vice president, but of course, there’s no salary grade or compensation increase associated with it. Greg is floored. When he questions it, Sal acts surprised. He tells Greg that he’s already well-paid, and should have realized there wouldn’t be any increase, but that the title is worth a lot in prestige.
If you were Greg, what would you do?
These two respondents summarized Greg’s situation succinctly:
Option 1: Profusely thank everyone for the promotion and stay because you like the people and the work. Bask in the glory.
Option 2: Quietly verify that your salary is indeed appropriate for the position. If not, work with a recruiter to test the market and see if you can earn a significantly higher salary.
After allowing time to digest and vent, Greg should reflect on what he wants in his career. What’s important to him? Is it the money, title, people, the work itself, or a combination? Does he currently have all, some, or none of it? Then he should think about alternatives. Can he get a better deal elsewhere? What are the risks and benefits of leaving? He’s already well-paid, and now gets the higher title, so he might not get a better deal elsewhere. However, if he feels that he’s treated with disrespect by his current colleagues, that should weigh in his decision for leaving or staying.
While this actuary went into additional nuances:
This is a great example of the challenges of management, and how often we fail or get stuck on titles.
Sal failed when he told Greg he had to be promoted to get a big increase, and because he was divorced from Greg’s plan for promotion. Every job should be compensated fairly, and performance should be recognized at every level. Job titles and promotions should be about demonstrating higher level competencies and assuming more job responsibilities, not high performance at the current level. If Greg’s salary was already above market or corporate guidelines, Sal should have said so in annual reviews or performance conversations.
Did Sal think Greg was performing as a VP already, before the most recent year? If not, what guidance did he offer Greg about being a VP? Did they talk about changes to compensation at the new level, such as executive bonuses, additional retirement benefits, etc. as well as the additional accountability and expectations?
Greg seems to have disconnected his work on a corporate restructuring and downsizing project and his personal promotion. Clearly the company is looking at staffing and developing efficiencies, and may not have budget flexibility for large salary adjustments; while Sal might have told Greg promotion = salary increase, that may have changed. Maybe the restructuring and downsizing also included a compensation review and adjustments to pay ranges that Greg wasn’t aware of. Part of a company leader’s responsibility is to understand and support the big picture.
Does Greg support the corporate direction? Does he really want to be a leader in this company, or just want personal recognition via title and salary? Does he think he’s underpaid compared to similar actuarial positions in other organizations?
If Greg likes the company otherwise, and wants to be a leader there, he should take a breath and seek information. He should ask Sal, and likely Sal’s boss, to provide specific reasons for the lack of salary adjustment, so he can understand the reasoning. It’s possible this is a short-term financial situation for the company, and Greg’s salary will be adjusted at a later date. Greg also could ask about a promotion bonus or other immediate recognition that might be possible under the new corporate guidelines. If Greg has a comfortable relationship with Sal, he could provide Sal with feedback on setting appropriate expectations as a manager.
If Greg is unhappy with the company’s direction and opportunities after getting that information, it’s a good time to start looking elsewhere.
This actuary felt Greg needs to take a more holistic view:
Greg needs to take an honest look at why he chose this career and determine what he wants to do in life and what truly motivates him. If it’s solely money, he won’t ever be happy, as there is always another job that could pay more. If he wants to make a “difference” in the world, it could be he is already doing that, he just needs to look for it. It could be that his satisfaction comes from the impact he has in his community, and that his current job allows him the freedom to do that. Potentially the higher title with more responsibilities will keep him from that because he needs to spend more time at work. There are many items that make a life well-lived, and pursuing money is not one of them.
This respondent was pessimistic about Greg’s future at the company:
He should talk to a recruiter and start looking for other opportunities ASAP. I’ve been there, and I wasted a lot of time at a company who dangled the possibility of “prestige.” In the end, it meant that when I finally got fed up with being the workhorse and went to another company, I started off at a deficit because they based my offer on my last salary. I enjoy what I do and getting to work with a lot of great people, but it still stings when you are paid less than a peer (or even a subordinate who has seniority) because your starting position was lower than your true market value.
Greg has tried to give his company the opportunity to make things right to no avail. It’s time to move on.
As was this actuary:
Prestige is worth nothing—obviously, or some money would have come with the new title. To paraphrase what Paul Graham wrote, “If it didn’t stink, they wouldn’t have had to make it prestigious.”
Nobody likes to be taken for a sucker. If Greg swallows this particular move, more impositions are awaiting him. Cool off for a while and wait until he is not so emotional to convey to Sal his understanding that, in order to get a notable step-up in pay, he needed to have a promotion. Obviously, this wasn’t sufficient, and not what he had expected.
Given Sal’s initial response, I assume this is the usual corporate bushwah and the decision is unlikely to be changed. Instead of resigning, Greg can use the change in title to update his resume and go job-hunting. Maybe that fancy new title and its prestige can get him a higher-paying job elsewhere.
This respondent advised caution:
Greg should not react impulsively. He needs to be sure he deserves a bump in pay, and it is never wise to give up a good paying job without either a new job lined up or an egregious circumstance that makes it unacceptable to continue. Not getting a pay raise isn’t sufficient reason to quit.
After Greg takes some time to reflect, he needs to consider in totality what he likes about his current job and whether it is reasonable to think they can find someone equally capable to do his job for similar pay. Reach out to recruiters to talk about job opportunities and gauge whether there is work available that meets his skills and compensation expectations. Collecting these two data points can take some time, and then Greg will have better information about whether he should take a new job, ask Sal for more pay, or quietly go back to his office and get back to work.
While this actuary advised patience:
Resigning on the spot can feel good in the moment, but it leaves you without immediate prospects, accompanied by a lack of income and the need to explain the sudden departure in upcoming interviews.
Start to have some real conversations. Put together talking points and practice to be as professional and pointed as possible, then follow-up with Sal in the near future. Discuss the excitement at receiving the promotion but the disappointment at the lack of change in compensation, especially compared to expectations. Bring up the question of consistency across the organization and with other individuals at that level. Do all of this professionally, but in such a way that it’s clear the events hadn’t sat well.
Give the organization a little time to respond. It may be that Greg is truly compensated at the right level but they had failed to communicate that. It’s important to give a little time to see what they come back with. If the response is not satisfactory, determine if his best options are still at that company, or elsewhere. If elsewhere, put together a resume and start a job search, looking for a better long-term fit consistent with his expectations. No need to rush out the door.
Some shared other considerations Greg should take into account:
Is Greg willing and able to move to another company? Another city or state? Another type of role? What is the cost of a move versus the cost of staying?
Greg should consider: (1) Whether the new vice president position will provide challenge, growth and future upward mobility; (2) whether he supports the values and mission of his employer; (3) relationships with other employees; and (4) his willingness to relocate, if he considers a change of employer (which will involve his family if he has one).
Finally, this actuary thought the title had significant value:
If Greg resigns too quickly, he will destroy any leverage he has negotiating severance, and reduce his apparent leverage negotiating for another position.
The higher title is worth a lot in marketability. Since it is clear that the work rewarded by the promotion has no financial value to the company, depending on the exit strategy Greg chooses he can also cut back on work to spend more time developing his plans.
What Actually Happened?
Greg shared his frustration with a trusted ally who was already a vice president, and was able to determine that his current salary truly was in line with the new level. He then reflected on his situation, and realized that he still enjoyed his work, the company, his co-workers and his overall situation. And even with the “promotion,” he did have the work/life balance he desired. So, he decided to stay, but did not retain the same level of trust or respect for Sal as before.
A few years later, when Greg was promoted to chief actuary, he came across the memo Sal had written to the president advocating for Greg’s promotion. It said how he wanted to recognize one of their most productive employees. Greg laughed.
Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries, the editors, or the respective authors’ employers.
John Hadley is a career counselor who works with job seekers frustrated with their search, and professionals struggling to increase their visibility and influence. He can be reached at John@JHACareers.com or 908.725.2437. Find his free Career Tips newsletter and other resources at www.JHACareers.com. LinkedIn: https://www.linkedin.com/in/johnwesthadley/