We don’t want to pile on, but Satya Nadella probably wishes he could have a few of his words back.
On Thursday – in front of a group of women in the tech industry – the Microsoft CEO was asked how women should go about getting a raise. His answer:
“It’s not really about asking for the raise, but knowing and having faith that the system will actually give you the right raises as you go along,” Nadella said,ReadWrite reported. “That’s good karma. It will come back. That’s the kind of person that I want to trust, that I want to give more responsibility to.”
Errr, okay. That’s really bad advice. And not just for women – it is bad advice for everyone (although the numbers show it is particularly bad advice for women).
However, there is a lesson to be learned, because frankly, far too many companies have adopted Nadella’s line of thinking without actually adopting the strategy he’s outlining. Instead, if companies can get out in front of it and actually come through on the promise Nadella is making, there is a huge competitive advantage to be had.
The Falsity of the Comment
The fundamental problem with Nadella’s comment is there is a mountain of evidence that show it isn’t true. He is preaching for people – in particular, women – to keep their heads down, plug away and big salaries will just magically come to them.
While that strategy might have worked when Dwight Eisenhower was president, the numbers reveal that just isn’t the case anymore, particularly in the past five years. Since 2009, corporate profits in the US have increased by 84 percent, one of thelargest five-year increases ever.
In that same time, wages for American workers have increased by a mere 7.86 percent, despite record productivity. Never before in American history has there been such a gap between the percentage profits have increased in respect to the percentage wages have increased.
And women have always felt it more than anyone. Despite plenty of efforts, the gender gap persists, even at the highest levels: the Wall Street Journal reports that female CEOs make 80 percent of what male CEOs make.
So the problem with Nadella’s comment is that it isn’t untrue, particularly for women. Chances are, if you don’t advocate for yourself, you’re not going to get an increase.
What if Nadella’s Comments Were True?
That said, what if Nadella’s comments were true? What if people really did just have to focus on their work, and their salaries will reflect their true productivity?
This would be a huge competitive edge for an organization. After all, studies showthat if people focus on their work and not their salaries, they produce higher-quality work and their morale improves.
But this can only happen if companies come through on what Nadella is promising. And that means being proactive and giving out bonuses or salary increases to people who deserve them, instead of waiting until the end of the year or when the employee asks.
It also means talking to employees who aren’t getting the job done and telling them how they could improve, knowing that if they do, they’ll be rewarded. If people can trust that the money really will come, the focus will be on the job, not the dollars.
The Takeaway
We get it. Companies are under intense pressure from Wall Street and shareholders to improve profits at all costs. But while these large profits are nice, there are going to be consequences to stagnating wages.
And that’s exactly what was so frustrating about Nadella’s comment – the evidence shows it isn’t true. If it was, no one would have an issue with it.
Companies should work to make that happen, get ahead of the curve and fulfill the promise of Nadella’s words. If they do, not only will morale increase, a competitive advantage will be gained and the company will prosper.
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