In what local human resources experts are hailing as a “really smart” move, Shopify is restructuring its staffing and compensation model.
The Ottawa-based e-commerce company says staff will now be split into two career tracks: managers and crafters.
Compensation levels will be equivalent regardless of whether someone chooses to be a manager or a crafter.
Shopify says the model will reward people for the impact they make on the company no matter if they are a manager or not.
“‘Management’ shouldn’t be a thing you have to do just to get ahead,” Shopify said in a news release on Wednesday. “Our new talent approach flips this antiquated management thinking on its head.”
A pair of prominent human resource managers praised the software giant for acknowledging that not everyone wants to be a manager or is cut out for such a post.
“I think it’s really smart,” said Karen Brownrigg, founder, and CEO of iHR Advisory Services. “The last thing you want is someone in a management role who is only there because they need more money.”
Brownrigg said it’s “a good move” for Shopify in rewarding and recognizing the strengths and weaknesses of their team.
“Not everybody is suited to a management position.”
The Shopify announcement adds that the model bucks trends that saw companies only succeed at incentivizing and rewarding managers because crafters will now have just as rich a career progression.
For Brownrigg, there’s a “delicate balance” to putting managers and other employees on an equal playing field.
“What’s really difficult is continuing to evaluate that and make sure that you’re not overcompensating or under-incenting one over the other,” she said.
It will also be key to pay “really close attention” to any aspiring leaders in the organization who are “demonstrating leadership competencies,” Brownrigg added, and “find a way to not create such a divide between the manager and crafter role.”
Kathryn Tremblay, co-founder and CEO of Altis Recruitment, said the new model will reward employees who might be introverts or less inclined to leadership and would rather “focus on their craft.”
“What’s interesting is in the past, we basically instructed employees to think that the only way to advance in either growth of role, job title, and compensation all came from becoming leader and manager,” Tremblay explained.
“But what if you’re an amazing contributor, but you don’t want to lead people?”
Shopify’s move comes after it began giving staff a “total rewards wallet” last year that allows them to choose between cash and stock options for their compensation.
“I love what they’re doing here,” Tremblay said. “I always applaud Shopify because they’re often ahead of the curve and thinking of what leaders are thinking about but haven’t figured out how to do. You can be an expert, love what you do, and you don’t have to choose leadership to grow.”