Pay for Performance Invading the University System – Here’s Hoping It Trickles Down and Out

Last week I attended the San Francisco Business Times event, “Bay Area Biotech Forum.” What a fascinating opportunity to hear about some of the newly emerging biotech and life science research trends, and how incubators and startups are taking advantage to push the envelope on what it means to have a healthy and highly productive life.

The most intriguing for me was Dr. Regis Kelly, an amazing man in his own right, sharing some of the innovations his QB3 institute is pushing at the behest of his boss, University of California President Janet Napolitano. Dr. Kelly, long an advocate for entrepreneurialism and capitalism to drive innovation and growth, which was once akin to Don Quixote tilting at windmills in a university setting, is attempting to link professors’ pay for performance. While it’s a bit more complicated (what about the university structure isn’t?), the bottom line is that the UC system is pushing forward with the idea of not just equipping and training biotech entrepreneurs, but providing startup cash by tapping into the pension funds of professors. In reality it’s more likely the entire UC system pension fund, as opposed to just professors, but of course my mind exploded with the concept that, in the not too distant future, professors might be staking their future retirement on the students they have helped to educate, nurture and grow. As a product of the university system, a former adjunct professor, a daughter and daughter-in-law of secondary and elementary teachers, I relish the idea!!

The concept of pay for performance is not a new one; look at the sales industry. I recently attended the Altarena production of the play Glengarry Glen Ross to witness one playwright’s depiction of the seamier side of sales. Yes, negatives can happen in any business. But the positive reality is that there is a quantifiable and tangible way to track and measure the results and output of salespeople.

When I am with a client, as many of you know, the first questions I ask are

What are our objectives?              

                  How will we measure them to ensure they are achieved?

                  What is the value or ROI for your company?

As a consultant, I want to be paid not because I came in and spent time within the organization, but because I made a tangible difference that my client and I can identify and take pride in. It was actually one of the reasons I deliberately left the internal fetters of organizational life. While it was great when I was paired with internal clients wanting to make a difference and willing to work with me to achieve that improvement, it was quite another to work with those who really didn’t care whether the objectives were achieved or not because they knew, regardless of their actions, they were walking home at the end of the day with a monthly paycheck.

As an individual within the system, I didn’t have a choice but to grit my teeth and work with them. As an external consultant, I have the choice of whether I want to work with them or not. What a breath of freedom!

So here’s my question – if your job were on the line, and you realized that your pay was based on the measurable results you achieved, what would you be doing differently? What would you be encouraging your boss and colleagues to do differently? How would your attitude and mindset shift? How might you more fully support and engage your own direct reports?

Regardless of the organizational system you operate within, be it educational, business or government — creating clear expectations, measures to achieve those expectations, and pay associated with achieving those results are timeless concepts that can be applied throughout.

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