How long has it been – really – since you’ve given thought to the arc…
John Borrowman, CPC
Borrowman Baker, LLC
You know the number we’re talking about. It’s the one you have in your head that you’re prepared to give when the interviewer asks about your expectations. But, where did you get it? Moreover, how reliable is it?
When you’re working on an assignment—especially if it involves litigation—you know you have to be sure that your data comes from a reliable source. When it comes to information about compensation, though, business valuation professionals often turn to some of the slipperiest of sources. Here are three examples.
GlassDoor – GlassDoor is the go-to source for lots of BV/LS professionals. So, what’s wrong with that? First, the salary data is self-reported and, by extension, unreliable. (In fact, self-reported data is so unreliable it is excluded from true compensation studies.) Second, job titles in the BV/LS profession are insufficiently descriptive. A Supervisor in one practice could be the equivalent of a Sr. Manager in another. A Manager at your practice could be an Analyst somewhere else. Results you get at GlassDoor can be misleading.
Cost-of-Living Calculators – Online COL calculators are ubiquitous and often come into play when a relocation is involved. The problem? They’re an average of an average of an average. Think about it this way. There are probably areas of your city where you could live for less than you’re spending now, and be comfortable. Then, there are areas you could live at much higher cost than where you live now, and you’d certainly be happy there. The point is that there are ranges like that in every city. However, those distinctions disappear in a COL calculator that averages everything out.
Watercooler talk – Discussion you hear through the grapevine is second-hand, at best. You have no context (in your world: comparables) for understanding how or why someone received what sounds like an outstanding salary increase in connection with a job change. There may be very individual circumstances at work that wouldn’t apply to you or the person you hear the story from.
We know you’re not going to stop paying attention to these sources of salary information. It’s human nature. What you should do, however, is put a lot less reliance on that information. Instead, contact us for a confidential and individualized Salary Consult. Watch a short video here and schedule your Consult.