Merit Matrix: Using Predictive analytics in building Compensation Programs

Merit Matrix, is there still any merit in it?
You can build different merit matrix model, but your underlying employee indicative data remains the same.

A What-if projection on compensation budget is built on, current Performance rating, current salary and market pay range. The budget alignment is computed by an iterative increase, to arrive at an approved budget.

A model that is built using above information has a flaw, when forecasting, the data set used for building budget should be in the future, instead of current.

With the advancement of predictive analytics and machine learning, the ability to build more accurate budget programs that aligns with your organization is what HR should be looking at. The magic 3% budget should be exposed in a way, its usage is more actual than accrual.

The merit in Merit Matrix can still be retained using the traditional method of building budgets only by applying modern heuristic algorithms.

Enough talking where am I going with it?

Let’s take any traditional Merit matrix and its components, Performance rating, Compa-ration (driven by Mid Pay) or Quartiles or Range penetrations. All this data, boxes employees into a matrix and an iterative method of applying increase percent guides to build budgets.

What if we have the ability to use the future data and build our budgets on top of it, that means our budgets are more accurate and close to reality. Let’s for a moment assume we have the power to predict employee pay increases, then we can build bottom up budgets using increases predicted by machine learning algorithms.

Using regression algorithms we can predict salary increases to a fair degree of accuracy, it gives you a fixed budget that is more accurate and close the actual requirement vs the 3%.

Now using the predicted pay increases we could box employees into the appropriate quadrants in the matrix based on the predictive distribution. Now HR can build guidelines and rollout a more accurate matrix to managers.

Once you complete the merit increase cycle, you can also compare the predicted increases vs manager input increase. A bias report, an outlier report and more finding, they are of immense value to HR.

Does this really work? The proof of the pudding is in the eating

We built few models for different organization with varying organization size from 300 employees to 30,000 employees, the organizations are from different verticals ranging from manufacturing to services to specialized job. For each organization we used different data points and so our models were unique by nature and the training data for building the program was specific to each organization. We validated our logic on the data sets. Our predictions was cross referenced to historic information of increases. We could arrive at a high degree of accuracy. We are now in the process of intervening user experience to influence the dependent variables used in the predictive analytics. I am working on to build a model that can be shared by customer but still has uniqueness in delivering specific value.

True Customer Connects

Put your heart in and you can deliver the best.

Friday, December 15, 2017

True Customer Connects

Customer satisfaction has a new meaning

                                                  

When  Pat and I started Laserbeam, our only goal was to deliver an inexpensive, yet feature rich software for our customers that pays back every penny they invested. Software products don’t have to be so expensive!.

We have come a long way. I always trusted from the heart; keep doing whatever you do, to the best of your ability and satisfaction, and the rewards will always follow. 

This is all great, but then how do we measure customer satisfaction? There are surveys, connections, meetings and many more. We greet, drink and dine. At the end of the day we have a piece of paper with a high score of 4.5/5 Customer satisfaction index. I always wondered if this is just an index of satisfaction on the work you have done, what more?  Did we really touch them or move them by sharing their pain in business, their work place, job or small things like preemptively adjusting the meeting when they have a personal need.

I know that most of the time we work with the actual doers and not the stakeholders. We take time to get to know them - often reading between the lines on the challenges they are facing at work. A simple thank you and a note of appreciation makes their day. 

I remember once, when one of our client managers was having a baby and her colleague quit, we said we will take all the work and manage until she finds a standby. We said forget the contracts and hourly rates, we are here to help you. That small thing is an example of why we build such good relationships with our customers.

I know we are not working for charity, but does everything need to be billed? No. Then there is the whole other notion about business is a rat race, everything needs to be tied to revenue, "Show me the money", yada yada yada... , I do not live in a perfect world and nor does anyone else, but I believe what keeps us all going is to remember that we are all trying to do work that we can be proud of. 

I always found it difficult to explain that "you will make money in the long run if you do the right things". With twelve years passing by since starting Laserbeam we can observe that 40% of our business has come from referrals.  That means we have saved tons of money in sales costs just be doing the right things for our customers. We never required customer satisfaction scores to win these deals. When someone recommends Laserbeam from the heart vs a lip service, you will know it. The former always closes a deal. I used to wonder how this all adds up, but it’s clear to me we followed the right path.

So is there really a customer satisfaction measure? Yes but it’s not by getting them to answer a set of questions and rating them. I found the true measure when I received a bouquet of flowers across the globe from thousands of miles away, when they heard I lost a dear one in my family. Recognizing the grief I was experiencing, sending a condolence note, and this expression of caring about me as a person just beats me. This to me is a customer satisfaction index that made my day and keeps me going on and on and on...and now it all adds up. Cheers!

Dedicated to all my wonderful customers. 

A Self-belief journey, learning Chess!

 

Another birthday is about to hit and another year is about to pass, this year is different from the rest. 2020 started with great gala personally and professionally, wanted to get a break through in new markets where we expanded our business into, we got our first order.

Then came the lockdown, months rolled, we were already into two months of lockdown. Time was moving slower than a snail, started to feel restless, a genuine feeling for anyone who has been travelling a lot and was active outdoors. Not seeing friends, not having the week end activities was taking a toll on mental and physical health.

Now it was already the month of May, almost half a year gone before I could realize, I have been rusting.

I need to get off this rust and galvanize myself with some professional and personal coating, what better than to try out new things…

I learnt a new UI design tool, made numerous UI design to the extent customers were Wowed, but this is not about it.

The other area was to learn some new game that would keep my brain cells active, turned my attention to chess! Yes Chess!

I knew the basics of chess as a kid and has never played beyond with family members, couple of dozen game during school days. It has been 25 year since I played chess…venturing into it was like learning to write the first alphabet.

It all started with Agatmator’s YouTube chess channel, I bumped into it when I started to search for some games…I started to watch all of them, the stories of players, the blind fold chess, the openings and what not…This started to kindle interest, can we start to play, dusted of an old board game of chess and started to ask people at home to play, well children don’t want to play anything that’s not on an electronic device…needed to find alternatives, install Chess game on my phone and started to play vs computer. I could pass level 4 computer and then never could win. “This is challenging me…” how can I not pass level 4, then what about playing real people do I even have a chance to win a single game…this started to prick me, so nervously decided to play anonymous on a web platform and I was not wining, now my fear was confirmed , computers and people can beat me easily. ”This is challenging me…” I said to myself.

Let’s accept the challenge, so I signed up on May 18^th with Chess.com, payed my first game starting level 628 and lost in time control...10min blitz game. I played a dozen games and my rating climbed to 836 by June 1^st. A glimmer of hope you can win games but not all, I thought if I can climb 200 point by playing 12 games lets target 1000 points by end of June. Didn’t realize things doesn’t work that way, the higher you climb the better players you meet and the scoring is going to be difficult, naive.. I played 17 games in June, the reality did the rain check. My new score 764 end of June. 

Then I realized, there should always be a method to madness. I need to figure out the method to get to 1000 points. The more I started to read players journey, the reality sunk in will I even make it by the end of the year. The demons woke up and the angels where questioning the loyalty of self-belief.

Let’s make moves, baby steps, so I decided to get to 800, then 900 and then 1000, well easy to say and no time pressure, let target by Christmas to hit 1000 points. First let’s get to 800, I knew I cannot do the same things that I did before and expect to hit 800, I have to do things differently.

First run was to search for rating climb and I hit on one John Bartholomew Chess fundamentals videos on YouTube. An eye opener course for all openers like me. I saw it over and over to get the fundamentals right, easier said than done, the games where intense and never could I remember to put what I learnt to use. Then, his rating climb videos, totally impressed, this guy could play while talking and still beat players. The moves are made in seconds, time management was excellent. Equipped with new learnings, I get into the ring one more time, with all my focus and attention I could neither keep up with time nor with the moves, 800 started to look a distant dream.

By now I started to watch a lot of game play, learning from the best in business, St. Louis Chess club videos, I completed watching all videos posted in the Agatmator’s channel under, Morphy Saga, Capablanca Story, Mikhail Tal, Botvinnik Games, Caro-Kann defence, Nimzo-Indian Defence., I am talking about 300+ video of ~20 min length. This familiarized me with lot of classical chess games and players, I was still lingering in the eight hundreds. .no progress.

My rating slowly started to climb, I have played 247 games in July and by end of July I was at 908. It was not at all bad, 6000+ minutes of video watching, I watched them, every bit, whenever I was not working. From waking up to going to bed these videos where playing continuously. I said at this rate I can hit 1000 by August end. Did I know, things don’t move up the same pace, I didn’t?

August angst!

I played 287 games, by August 10 I was at 940, I said to myself, going good…at this rate 1000 will be in the next 10 days.. Hee Haa..

August 11^th 8 game losing streak, I am back to 858. This is when you mind plays games, you are doing it too much, trying hard, and time to take a break and many more thoughts, now even 900 seems to be a distant dream. Soul searching, are their people who got burnt out like me, google them to see what they got to say, they all said in chorus need to take a break.., I know me, if I take a break, that break will be the longest ever and I may not getting back, breaks are not my way…my way is to redo from start.

New Method to Madness…go aggressive, more search on more steamers, who can inspire and instill self-belief. I bump into one Mr. Hikaru Nakamura, a kid chess prodigy, now a super GM, his honesty and simplicity pierced me like a pin pricking a banana. So became an ardent fan of him, then his co-streamers, Gotham chess, Levy Rozman. Between them, on Chess.com or twitch, sub battles and rating climbs, garbage openings, Title Tuesdays, there was a plethora of chess, and even a damp sponge can absorb. Levey with his tactical training ideas and selfless teachings you can learn tons from him. The e4, d4 rating climb, his 10 min openings, Gotham chess guide, it’s an elixir for beginners, and mid-level players.

Hikaru is brilliant, and who am I to even say that, you should be at a different level to even praise him. He made it look simple, easy, the emotions coming out of him was so genuine, doesn’t matter was he playing or watching someone else’s game. Between the two it was like a theory class from Levy and a practical lesson from Hikaru. They go hand in hand, the beauty of reading and the imagination of seeing was happening to me. I have ended up in the right place, end of August I was at 970.

Then I couldn’t move past that, one thing I realized was, I now knew more about chess than when I started in May. Still something is not letting me hit the 1000 mark. End of September another 102 games and my rating was still at 970

Time for self-introspection. I was too stiff when I am playing, my small sticky notes on points to remember, about backward ranks, hanging pieces, Checks, Captures, Attacks and time checks all were in paper but not in my head while playing, too engrossed in the game. I need to loosen up… I was serious about Chess.com and my rating, is there some other alternate site to play for fun and take things light, yes found Chess24.com, I signed up on Oct 1^st, purely to play for losing, learn from losing and to chill and take it light, I played 120 games in October and on and off I would play in Chess.com, Today Oct 21^st I hit the eluding magic rating of 1006..

Can I sustain I don’t know, but one thing I know for sure, if you have a method to madness, relentless pursuit, follow visionaries, practice with patience and chill…You can climb, you self-belief is a passed pawn to queen of success, is waiting…

Gain in Pain

The Inspiration

With pain there is gain, pedal to the first long trip on my bike; it all started on Deepawali 2010 when I decided to start cycling, and gifted me an ACT110 plus, inspiration to be fit @40. Starting a new sport @38 seems to be strange for many, whom I spoke with. With all the will and inspirational stories of cyclists in bike zone and other sites drove me to take a hit at it. My target was to do 50 Kms a week, many hurdles to break the will power; I would want to say it out here so it helps my fellow beginners and kind of adjust your form. I spent about 3 months of reading before I got on my saddle. So the form is absolutely important and I learnt it the hard way.

The form

The first challenge is your back and bum is not used to sitting on a road bike saddle, I felt the pain to the extent that I wanted to add it to the list of punishments in hell, along with frying pans. So a week into riding I am doing around 30-45 min rides I started to develop severe back pain, doctors advice stop cycling. Jee!, I just started. I take a break for two weeks, and use the two seeks to strength my back. I changed the position of my saddle, raised the handle and am back riding, two weeks into it, toe pain.

MRI, CT, X-ray, still my Ortho could not find the problem, then I found out it is a stress fracture under my left toe second finger. No more rides for a month. I understood what was happening, every time I used to stop my bike, I used to rest the whole weight on my left toe leaning the weight without dismounting from the cycle. Correction, even for a short stop get off your bike fully and stand firmly with weight balance on both legs with your fork across your  frame. Make sure you have the right frame size.

After these corrections in form, I thought, I am ready and let’s get back. Well, I wasn’t. Even thought I have read in many articles that I should not pedal using my toe, it happened I was doing that after realizing there was a tingling feeling below my toes that contributes to the stress fracture. One more correction needed, consciously move my toe forward to position in the right place on the pedal so that force is transmitted perpendicular to the toe ball that connects your toe to your leg. Make a mark on your shoe with a marker so it aligns with the center of your pedal.

The Body

This time I have settled down with a form that suites me. I have started with regular trips without much sweat. One day I tried to push a little harder and learnt that the form has nothing to do with your body and its ability to perform, it was a 15 Km ride with two bridges started after eating Adai a low carb breakfast in the morning. My first experience with bonking, your brain functions (your senses) but your body doesn’t, luckily, I was at a spot I could drink water and take some sugar and sit down.

Now to your check list, listen to your body, it cries out for attention. The most beautiful thing about bicycling is it relates to freedom synonymously. So I stared to take water breaks at regular intervals, stop to look around, hum a tune from a song to check my breathing pattern and confirm I am not panting.

Ok, now the body is getting used to it and the form is good, what else, let’s keep pushing. Now slowly I have started to believe it’s working, I can do cycling, I made some more minor adjustments, added a gel cushion to my saddle, added mud flaps, get those breathable jersey, Nike has them, you don’t feel that your jersey is sticking to your body.

The trip

At this point I can do 1 hr trips daily without any pain or strain, updates in dailymile.com.  As always as humans, the question, what’s next?. A test to check your endurance, cadence, etc, etc..., a plan for a longer trip. I decided to do two hours; I have to do this really early in the morning, so went for some shopping, head light, tail light, energy drink (tang), and bourbon biscuits (yummy). Set my alarm to wake up at 4:00 am and I did, took 30 minutes to saddle up after a little bit of stretching exercise. Mugappiar to Periyapalayam, 40Kms. The roads are good until the Karanodai toll gate, I took my first break at Puzal 5 minutes, my second break 5 Km after the toll gate another 5 minutes. Wolla ! I reached my destination in an hour and fifty minutes. I thought I would put my bike in a bus and return to Chennai, well there was no such option. I was tired checked with the local share-auto, he was asking 500 bucks for 15 kms, I wasn’t going to pay him. I had my breakfast couple of idly and a dosa. With no option I decided to pedal back, the road was treacherous as the traffic has started and there was road work expanding the 15 Km stretch from Periyapalayam to the toll gate on NH5. I decided to find alternate means, and up front there was a tractor and trailer, I chassed it , passed it and asked for a lift!, I was in the back of the trailer holding my bike and sitting. Man it was one bumpy ride, my bike saddle felt like a pillow filled with Egyptian cotton with comparison to sitting on the trailer surface. They dropped me few Kms before the toll and I rode back home an hour and 15 mins. A total of three hours and a distance of 60 Kms. Reached home, had lunch, slept the rest of the day, never felt so fresh like this before recently.

The result

Decent endurance, good cadence and a huge confidence boost. Looking forward to 40, felt fit like the days in college.