People are one of the few assets a business has that appreciate in value.
I think the phrase "intellectual capital" describes it best (
or "intangible assets".
The problem is that this is a recent (formal) concept (started in 1980), though one might guess that informally "good" managers recognised this intuitiively, and for many managers this is an alien concept. They measure poeple by what it costs to hire and fire and balance the cost of replacement against the cost of retention without regard to such factors as the time taken for a replacement to become as effective as the person he replaces.
To a degree this is a refelection of the treatment of the "replacable" manual skills being applied to to skilled and professional employees.
What it means is that in an ideal world your value to the company should be known and measured as automatically as the accountants measure the value of an item of equipment and you shouldn't have to divert some of your own time and effort to researching your value measured in the market place whereas the management should have a knowledge of your value to the operation based on a range of factors.
It also means that review discussions can take unexpected turns. Engineers are said to be unemotional and logical while it is a fair bet that managers are the converse. In fact it sometimes seems as if managers are potentially the most emotional and least rational people on the planet (with obvious exceptions which PC forbids I mention).
Do not expect fair treatment, logical appraisal or rational outcomes. Be prepared for distaster and always have your CV/Resume up to date and out there. ALways be ready to consider pastures new but avoid "blackmail".
Do not expect loyalty to be anything other than a one-way street.
If your company has pressures on it that means it cannot afford to pay you what you are worth (even if you can get them to admit what you are worth) look elsewhere. All the excerise of belt tightening (i.e. employees accepting that "times are tough" and that pay rises will not occur)will prove is that what you are worth and what you will accept are two different things.
One company i was at spent many years telling the employees of its most profitable business unit that times were tough in aerospace and that we were supporting aerospace. This went on for years with no annual pay rises, rationalisation, no investment, and a general devaluaing of the workforce. Management paid most attention to the profit and loss statement which meant controlling the salary bill.
Then a few years ago they sold the aerospace business for $60,000,000. This money was shared out among the shareholders. Not a single employee saw eny return on their own investment of time and loyalty. Do't make any mistake, if you forgo any rightful reward you are investing in the company and you ought to either accept that, look for some tangible alternative e.g. shares or get out. At any one time even in the depths of recession there are companies that grow and reward and others that don't. Never back a loosing side.
JMW
