I love that I founded a company full of millennials. Sure, they make me feel like the old man who still remembers Reebok Pumps and Gremlins, but they also force our company to look at meaning in addition to quality work.
This mindset changes how we handle flexibility in work location and meetings. It makes sense that this vision should spill over into compensation. In the minds of 9 Clouds and our employees: pay and purpose should be aligned. If we want to inspire our millennial employees, we want to incentivize them appropriately.
How 9 Clouds Pays Based on Interest
With this realization, we have changed our compensation to move towards mission-based compensation. This has helped our company focus on work that matters and that our employees want to do.
To get towards this holy grail of purpose and pay, we ask potential employees what is most important to them in a compensation package. It could be flexible hours, flexible work location, salary, benefits, etc. We don’t take a standard offer off the shelf and tell them to say yes or no. We want them to help craft the offer to fit their lives.
When an employee begins working at 9 Clouds, we create quarterly performance benchmarks that are both professional and personal. The professional goals are centered around a skill that they want to learn or improve, or a service that they think 9 Clouds should offer or explore. This acts as our covert R&D department, or Skunk Works, as we empower our employees to shape the future of the company. The personal goals are to help them learn something new, improve wellness or grow as an individual.
We know that work isn’t the summation of who our employees are, nor should it be. We want well-rounded, happy, healthy employees because that makes us better people and makes our company better as well.
We allow our employees to choose their quarterly performance benchmarks and compensate them based on their completion. This hopefully gives them a little more incentive to do something that they want to do anyways. Compensation is often money, but it could also be time off, additional technology or other benefits.
The Benefits of Interest-Based Compensation
There are three clear benefits we have seen from interest-based compensation.
1. Employee Retention
When compensation aligns with interest, our employees will be more likely to stay at 9 Clouds. Additionally, when compensation is created with their interests in mind, it is easier to have a conversation on how to motivate them over time. For some it means they want more freedom over time with remote work and vacation. Others want salary and health care benefits. Knowing what our employees want and personalizing our offers appropriately (hopefully) makes us a great place to work.
2. Company Development
We want 9 Clouds to be a reflection of our employees. Their interests and passions shape what we do and what we learn to do. By asking our employees what they would like to learn, we identify growth opportunities and also get an idea of other skills or personalities we should look for in future hires. Moving from “do this” to “what else could we do” keeps our company thinking forward.
3. Work-Life Balance
The dreaded work-life balance. For many millennials, there is no clear delineation from work and life. If you can receive an email at any time, day or night, it’s hard to keep the two balanced.
We, thus, aim for a compensation system that encourages professional and personal development. We believe that what our employees learn at 9 Clouds will also help them with personal projects and interests. Helping them align the two camps and focus on quantifiable improvement in both areas of their life will create the “balance” that we all seek.
New Models for New Times
We grew up watching our parents get paid a salary for working 8 to 5. That still works for many people. However, if we want to attract and retain millennials, we should compensate based on their interests.
We are not beholden to past compensation models. We will continue to experiment and ask our employees what matters to them because ultimately, they are what matter most to 9 Clouds.
The post How to Pay Millennials: Interest-based Compensation appeared first on 9 Clouds.
