Is Social Compensation in your future?’ve been watching Robert Scoble’s (@Scobleizer) coverage of the Enterprise Social Networking space, and am intrigued by one of his views that has been brought up at least twice recently (Yammer interview, Convofy interview). Robert believes someday (soon?) we’ll be compensated based on our contributions to the company’s enterprise social network (ESN). What’s not clear is exactly what that means. Does it mean our bonus will be calculated based on value we create? Is participation compulsory? Will we be judged solely based on our contributions? I believe there are many challenges and risks that must be dealt with before this type of compensation model is considered.

When evaluating employee performance, objective setting is possibly one of the most demanding and daunting tasks of the Performance Management Process (PMP) for both the manager and the employee. In my career, I’ve always been told objectives must be meaningful and objectively measurable. These individual objectives ultimately must tie into departmental and corporate objectives. Is this PMP process a good one? Probably not, but let’s explore what some of the challenges of using ESN’s to compensate employees.

Value is subjective – One man’s treasure is another man’s garbage and ultimately many of the dynamics in a corporation’s politics will make providing anything but quantifiable hard business value (increase revenue or reduce cost) soft and fuzzy. For example, the really great thing you did, helped a person who your boss disdains. What is the value of that?

Not everyone is on-line – What about the people that do not feel comfortable being on-line? Are we telling these people they must change or they provide little or no value to the company? Last year at the Enterprise 2.0 conference my former colleague Kathleen Culver and I talked about the dark side of Enterprise 2.0. We identified that false experts could be the most vocal in a company because the true experts are in a lab, out in the field or doing things that are not on-line. I believe we need to accept and celebrate that people will continue to be different and not everyone will participate in ESN’s.

Privacy is king – It’s really easy to claim “Privacy is dead” (especially here in the US), but having worked for a global company (Alcatel-Lucent), what is clear is that the EU has a different view on the concept of privacy. In countries like Germany, you are not allowed to re-purpose data collected on employees. Additionally, you are not allowed to use this data to measure an employees performance. This would require a different system to measure these employees creating an “us and them” feeling within a company.

While these challenges are significant, I do believe that the concept is worth exploring. I see opportunity is having Social Business Tools/Platforms providing employees the statistics to support their company’s PMP. Providing features like endorsements and strong individual analytics will go a long way toward having employees use this data to support them meeting and exceeding their objectives.

As we look at the longer term impacts on ESN’s inside companies, it’s important to remember social business is about employees feeling empowered. If at some point instead they feel they are being measured, the tone of the contributions as well as the quantity/quality will also change as people’s focus shifts from collaborating to meeting objectives.

What do you think? Will we ever be compensated for our contributions? What other challenges do you see?

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