Hiring and Collaborating with Higher-Paid Employees

Source: Berkeley Economic Review

What happens when we know that others are paid more than us?  Does it affect our willingness to collaborate with them?  What about hiring decisions? Are we more or less likely to hire someone who may earn more than us?  Cornell Professors Kevin Kniffin and Angus Hildreth examined this question in a series of experimental studies.  They found an interesting, but not surprising, dichotomy when it came to collaboration vs. hiring.

First, the scholars discovered that, "People chose to collaborate with higher- rather than lower-paid peers unless explicitly told that their potential collaborators’ knowledge, skills, abilities, and experience were similar, suggesting that pay was viewed as a signal for competence."  On the other hand, they found that, "People were less likely to hire a candidate with a higher (versus lower) pay history for a subordinate position on their team."  

This study has some very interesting practical implications with regard to the pay transparency movement.   The collaboration finding seems quite positive, though one has to wonder whether it is appropriate for workers to always use pay as a sign of competence.  In some organizations, we know that compensation and position is not at all a sign of strong capabilities!   The hiring dynamic is perhaps more problematic.  We would hope that people would hire the best talent, and that they would not feel threatened by someone who had excellent capabilities warranting high compensation.  Naturally, though, people's emotions are affected by compensation differences.  If it means that we don't hire the best people, then that would be very worrisome. 

Teaming is a Verb!

My friend and frequent co-author Amy Edmondson has a terrific new book out titled, "Teaming: How Organizations Learn, Innovate, and Compete in the Knowledge Economy."  I strongly recommend the book.   Amy is one of the world's leading scholars in the area of team learning.  Here's a short excerpt from a HBS Working Knowledge feature on the book; it captures the essence  of her argument:

In these prior treatments, team is a noun. A team is an established, fixed group of people cooperating in pursuit of a common goal. But what if a team disbands almost as quickly as it was assembled? For example, what if you work in an emergency services facility where the staffing changes every shift, and the team changes completely for every case or client? What if you're a member of a temporary project team formed to solve a unique production problem? Or you're part of a group of managers with a mix of individual and shared responsibilities? How do you create synergy when you lack the advantages offered by the frequent drilling and practice sessions of static performance teams like those in sports and music?

Teaming is a verb. It is a dynamic activity, not a bounded, static entity. It is largely determined by the mindset and practices of teamwork, not by the design and structures of effective teams. Teaming is teamwork on the fly. It involves coordinating and collaborating without the benefit of stable team structures, because many operations like hospitals, power plants, and military installations require a level of staffing flexibility that makes stable team composition rare. In a growing number of organizations, the constantly shifting nature of work means that many teams disband almost as soon as they've formed. You could be working on one team right now, but in a few days, or even a few minutes, you may be on another team.

I find her argument about teaming very compelling.  Consider your own organizational context.  How many temporary, fluid team structures exist in your workplace?  To what extent is teaming a verb, rather than a noun, in your firm?  If you want to learn how to lead in that type of dynamic environment, then I recommend taking a look at Amy's book.