Mention the phrase "competitive pay rates," and most executives focus on industrywide comparisons of their top-level managers. They rarely consider that lower-level employees engage in salary comparisons as well, not necessarily within the same industry, but will companies in their own backyard.
Management realized this at Griffin Grocery Co. in 1982, when it took its first annual employee attitude survey. To dispel the apparently prevalent perception that the pay was greener elsewhere, the Muskogee, Okla., food-products manufacturer began hosting annual slide presentations showing workers exactly how their wages compared with those at 13 other area businesses.
As it turned out, the company ranked in the upper third overall, says Lue Cox, Griffin's personnel director and office manager -- a ranking that surprised many on staff, especially the clerical employees. "We probably did better there than in other areas," Cox says, noting that the wages of Griffin's secretaries and clerks ranked second and third, respectively.
Fortunately for Griffin, the survey made the company look good. Undertaking a project in which the goal is to both improve morale and promote better communication doesn't make sense for a company that pays below par. So notes Susan Reynolds, a principal of Sibson & Co., a compensation and human resources consulting firm in Princeton, N.J. Cox agrees: "You must be prepared to defend your wage structure and correct any inequities that it reveals." In fact, Griffin Grocery's survey showed that although its secretaries' wages were in the upper percentiles, its skilled workers' pay ranked in the middle range. Consequently, the company boosted those employees' hourly rate by 50?.
Still, some employees remained skeptical. Says one secretary: "I think the survey was biased. They only polled companies that they knew were paying less than we were."