Can You Put a Value On Your Work Contributions? (employee, applying, profit)

[annerk]

I had an interesting conversation with a previous boss last night. We've both moved on from where we were working, and the company he's now working for is requiring all employees to be able to prove their value to the organization. Those that can't face potential ramifications such as pay cuts and even termination.

Attorney's have billable hours, doctors have billable proceedures, sales people have their sales, even receptionists can show they found a cheaper coffee service.

Fortunately my old boss has gone into sales and has been very successful. But what if he had stayed a CFO? How would a CFO quantify his value, even though we all know that's an important postion.

Would you be able to prove your value to your companies bottom line if you needed to?

[fishbrains]

That is a really unfair metric.

I can put a solid $ value to some of my daily activities. But other activities, do not have a direct $ value. What about the person who prepares a bank deposit? Or the person who unloads a truck? A compliance manager? HR?

All of these things need to be done, but could fall into the category of support. Does his company value ONLY sales/business development? If so, fine, but the sales will not continue without adequate fulfillment, customer service, IT and the like.

[Topaz]

Originally Posted by annerk

How would a CFO quantify his value, even though we all know that's an important postion.

The CFO is responsible for ensuring that the company stays in compliance with a large number of financial and legal requirements. One way to quantify the value is to present data on what happens to companies who fail to stay in compliance. In addition to compliance issues, the CFO provides guidance on many other issues involving money so CFO mistakes are expensive and can ruin a company. It shouldn't be too hard to prove the value of a good CFO.

[bande1102]

I think it is a really good exercise. Your value to a company is based on a lot of things, not the least of which is your fair market value in the market place. Example, my hubby is a GM. A few years ago, the owners of the company wanted him to prove his salary. They also wanted him to do this in the form of a resume. In other words, it was almost like he was unofficially re-applying for his own job. At first we were freaking out, but then figured if they were planning to fire him, at least we'd already have the resume ready for his next position. I helped him do it and it was a great eye-opening experience. We did a portfolio with charts showing p/l, increase in sales, decrease in costs that were directly attributable to his management decisions, etc. We also included documented statistics showing the salary levels for similar positions in our city. In the end, we determined that he was actually underpaid. The owners ended up giving him a nice pay increase and bonus.

I think at any given point every employee needs to know their role in the company and how they contribute to the bottom line. Unfortunately, I've been laid off before and I can tell that when employees don't know the value of what they are doing and how it contributes to the company overall, it is a very bad sign.

[Dane_in_LA]

Interestingly, blue-collar workers probably have the easiest way of doing this - if you build widgets from widget parts, it's pretty easy to argue that you transform X number of widget parts (value as delivered: $X) to Y number of finished widgets, value on the spot: $Y. Subtract one figure form the other, and there you have it.

Sometimes, my job (I'm a network engineer) is a bit like that: When I arrive, at a broken computer network, it's worth $0 and sucking up good electricity, to boot. When I leave a network in good running order, it's worth considerably more. Easy to figure out that I've added value, harder to tell how much.

Of course, I'd much rather spend my time figuring out ways to build it to not break, and time spent doing that is even harder to put a value on. (What's the dollar value of reliability going from 99.9% to 99.99%? Damn if I know.)

I guess that's why the market ends up putting a value on these things.

[Racelady88]

Interesting question. I spent many years doing A/P and as such represented the only position in the company that was looked at as money going out instead of money coming in (I wasn't the one spending it mind you).

The president pointed this out to me one day and it kind of rattled my cage. I was able to show him where I had implemented new procedures that increased the amount of vendor discounts the company was able to use. I also reminded him of numerous cash bleeding tendencies that I had identified company wide so that they could be addressed.The YOY numbers were fairly impressive.

[Family_Guy27]

I wouldn't know how to quantify the work I did in desktop support. Realistically, if the company I worked for didn't have computer hardware or software that worked, they couldn't do their jobs. I guess they didn't see it that way because I was paid like a mail clerk.

[annerk]

I am involved in both marketing and operations. The marketing end is easy to quantify. A campaign that I produced two months ago has resulted in sales with a net profit of more than my annual salary, so I guess I've already proved myself.

The operations side, I'm not so sure how to put that into dollars and cents.

[JS1]

What an idiotic demand for an employee. I would be tempted to respond with "Isn't that the job of HR or management? I work in neither so I am not qualified to answer your question."

[annerk]

I actually don't see it as "idiotic." I think it's a good excercise to get employees to understand how they contribute to teh bottom line. Those who can't come up with a way to quantify their existance (or at least how they have saved the company money) probably aren't needed in the organization.

I do see some jobs being harder to stick a price tag on, and that's really the gist of my question.