I want to say something quite clearly and emphatically, and ask you to repeat it to yourself a few times:

MY COMPENSATION IS ENTIRELY ARBITRARY!

For example, lets say you write computer programs for a software company that packages your code into products that it sells to customers.

You will probably be paid a salary, perhaps earn an annual bonus, and accrue some vacation time. You may also get some benefits, including a partially paid health plan.

All of this seems so normal, so typical that you never question this menu of dollars and perks. Sure, you may want a greater helping of salary, but still, as long as there is a salary and a few other goodies, youre set.

But what if one of your software programs really takes off in the marketplace?

Will you be entitled to receive royalties from it, have any ongoing equity interest in it, or ever be able to claim a bigger desk, a reserved parking space, or any material advantage from its performance?

The short answer is no.

If you ask your company about it, they may smirk or laugh or just look at you as if youre nuts and say, in a conclusive, parental monotone: We dont do that.

They wont say WHY they dont do it, because they probably havent thought it through.

In fact, paying you royalties or a residual income may be in their interest, it may spawn innovation, create that extra spark of incentive to attract and retain the very best designers.

How, then do companies decide what theyre going to pay?

MONKEY-SEE, MONKEY-DO!

They imitate each other. Some call it benchmarking, others conduct salary surveys, but the net of it is the same. They mirror each other.

Breaking the paradigm is difficult, once it has been established.

Let me give you an example.

One of my clients is a consultant who shows his clients how to save money on their printed advertising. Specifically, he knows how to tweak ads so they can be smaller, cost less, but yield better results than large ads.

He charges a percentage of the savings hes able to generate, which seems very reasonable, right?

If he doesnt save them money or improve the ads, they dont pay. Only if they get results do they have to pay.

What can be sweeter?

But he has found that is not the way his clients want to pay. They prefer paying him for his TIME, which is the way the great majority of consultants bill their clients.

They believe, of course, that if they pay only for time, theyll reap the benefit of his expertise, for less.

But even if they traded dollars, or if they saved money his way, theyd prefer to do it theirs, which is the traditional way.

When it comes to compensation, tradition dies hard.

But there is hope, if youre creative, diligent, talented, and they need you.

Check out the movie, Ray, about the life of the great singer, Ray Charles. Youll probably like the music, but listen for the part when he insists in his contract negotiations that he own the rights to the masters of his recordings.

Theyll tell him its unprecedented, but finally, theyll yield.

To borrow a phrase, when it comes to compensation, you dont get what you deserve.

You get what you negotiate, and they wont break with tradition, unless and until you do!