Manager vs. Direct report salary issues

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TechFI
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Re: Manager vs. Direct report salary issues

Post by TechFI »

VoiceOfReason wrote: Sat Jul 04, 2020 6:00 am Wow, not sure if this is an industry thing, but common sense says a manager makes more than direct reports. That is true across the vast majority of businesses. So this concern from OP is natural.

In medical sales where compensation is tied to base salary and commission plans, base salary is higher to provide more consistently higher total comp. However top individual contributors on your team will always make more than manager. Oftentimes A LOT more. The Mgr role adds consistency to by raising the floor but lowering the ceiling on your total compensation.

What is the point of becoming Mgr and taking in more stress and responsibility if total compensation isn’t better in some significant way?
From an impact standpoint, it's increasingly harder for ICs to make big impact compared to managers at the very high levels. In many orgs the top-level equivalent positions have more managers than ICs.
phxjcc
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Re: Manager vs. Direct report salary issues

Post by phxjcc »

Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
As to first question....
I was once a Director (manager of managers) and a Sr VP. Then I was hired as a first level manager to turn around a poor performing, but very profitable product team of 6 people; no change control, no testing standards, no support doc's, etc.

I was paid as much as my boss, who was 10 years younger and had less experience--and was wise enough to know it.

I cleaned it up.

Then there was a re-org, and as moved to an even younger boss who was in a VLCOL state.
Who was also in his job because of nepotism. (Son-in-law syndrome)
I was making 30% more than him.

He tried to cut my salary.
I objected.
He persisted.

I called the mucky-mucky that had to approve the original hiring of me.
Crickets, absolutely dead silence.
But no salary increase for 2 years.

Two years later, another re-org to a more mature manager.
Gave me a bonus to make up for Louis being such a jerk.
HIs boss eventually jumped me two positions--and to answer your question....yes I achieved my highest total comp then.

I eventually became CIO/COO.

As to second question....
YOUR JOB, as a Manager, IS TO ACCOMPLISH THINGS THROUGH OTHERS.
Period.
A good manager will be able to accomplish 12+ times more with a staff of 10 than those 10 can accomplish themselves.
S/He will also get a buzz out of doing so.
If you do not, then go back to an IC role.
it is the adrenaline rush when a major product is released and takes off that is your reward.
The stock, dollars, and accolades are secondary.

...and as John Wooden said: " do not confuse activity with accomplishment."
TechFI
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Re: Manager vs. Direct report salary issues

Post by TechFI »

Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
Yes, sort of. At the Director/VP level there are more managerial positions than IC positions, so your comp will be higher than your directs, because your directs will be lower level than you are.

Unless you get a Director/VP level IC under you, which is rare. And if you do, you should be happy.
Last edited by TechFI on Sat Jul 04, 2020 11:45 am, edited 1 time in total.
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

BTW one of the best pieces of advice I got from a past manager is to think of your team as supporting you and your growth. I still remember that and apply it daily.
E.g. One thing I would never do, is call out an employee as having a higher salary than me/manager. That would be awkward and immoral imo. This convo, if its ever had, is with leadership and your (my) impact on the team/org as has been mentioned. Just wanted to get that out of the way...
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

phxjcc wrote: Sat Jul 04, 2020 11:40 am
Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
As to first question....
I was once a Director (manager of managers) and a Sr VP. Then I was hired as a first level manager to turn around a poor performing, but very profitable product team of 6 people; no change control, no testing standards, no support doc's, etc.

I was paid as much as my boss, who was 10 years younger and had less experience--and was wise enough to know it.

I cleaned it up.

Then there was a re-org, and as moved to an even younger boss who was in a VLCOL state.
Who was also in his job because of nepotism. (Son-in-law syndrome)
I was making 30% more than him.

He tried to cut my salary.
I objected.
He persisted.

I called the mucky-mucky that had to approve the original hiring of me.
Crickets, absolutely dead silence.
But no salary increase for 2 years.

Two years later, another re-org to a more mature manager.
Gave me a bonus to make up for Louis being such a jerk.
HIs boss eventually jumped me two positions--and to answer your question....yes I achieved my highest total comp then.

I eventually became CIO/COO.

As to second question....
YOUR JOB, as a Manager, IS TO ACCOMPLISH THINGS THROUGH OTHERS.
Period.
A good manager will be able to accomplish 12+ times more with a staff of 10 than those 10 can accomplish themselves.
S/He will also get a buzz out of doing so.
If you do not, then go back to an IC role.
it is the adrenaline rush when a major product is released and takes off that is your reward.
The stock, dollars, and accolades are secondary.

...and as John Wooden said: " do not confuse activity with accomplishment."
Thanks great insights. And congrats on making it to the cio/coo level
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rich126
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Re: Manager vs. Direct report salary issues

Post by rich126 »

TechFI wrote: Sat Jul 04, 2020 11:36 am
VoiceOfReason wrote: Sat Jul 04, 2020 6:00 am Wow, not sure if this is an industry thing, but common sense says a manager makes more than direct reports. That is true across the vast majority of businesses. So this concern from OP is natural.

In medical sales where compensation is tied to base salary and commission plans, base salary is higher to provide more consistently higher total comp. However top individual contributors on your team will always make more than manager. Oftentimes A LOT more. The Mgr role adds consistency to by raising the floor but lowering the ceiling on your total compensation.

What is the point of becoming Mgr and taking in more stress and responsibility if total compensation isn’t better in some significant way?
From an impact standpoint, it's increasingly harder for ICs to make big impact compared to managers at the very high levels. In many orgs the top-level equivalent positions have more managers than ICs.
My experience is only in the tech world and defense sector. In those cases, especially when you have billable hours, engineers, programmers, etc. are the ones that are almost constantly billable and brings in the money. Certainly not saying managers aren't valuable and excellent ones are amazing although many managers are either marginal or dangerous (end up losing the good employees). And usually when there are layoffs middle managers are gone first since the tech workers are actually bringing in the money.

The hierarchy caste or whatever system reminds me more of the military where you aren't likely having an Army major report to a captain. There are certain government agencies where the grade (salary) is tied to a position and you won't likely see a higher paid person working for a lower paid manager but in my previous agencies the grade was tied to the person and it was quite common for a lower grade person manager a higher one. Although I do think when it came to promotions, that decision had to be decided by someone higher up the chain.

All of this is why I never had any interest in becoming a manager (just filled in out times, sometimes for an extended stretch when they had trouble finding a permanent person). You have to deal with ridiculous personality issues, you are more expendable, you lose your tech edge and have tougher time finding a new job, etc.
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

TechFI wrote: Sat Jul 04, 2020 11:43 am
Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
Yes, sort of. At the Director/VP level there are more managerial positions than IC positions, so your comp will be higher than your directs, because your directs will be lower level than you are.

Unless you get a Director/VP level IC under you, which is rare. And if you do, you should be happy.
Thanks! Yes, one benefit of having smart experienced senior IC's on the team, is I really enjoy collaborating with them.
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UnitaryExecutive
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Re: Manager vs. Direct report salary issues

Post by UnitaryExecutive »

This is actually a pretty common scenario, especially if you've been at a company a long time and the market has experienced significant salary growth. Pay bands for roles overlap and new folks typically come in at midpoint or higher whereas standard 3% yearly increases don't keep pace with the market.

The time to negotiate this is when you took the new role. Outside of that, it's unlikely you're going to get adjusted until a mid-year or year end review cycle, at which point you probably shouldn't bring up that folks in your org make more than you because it'll come off as petty. Instead, you should articulate your contributions, paint a picture of what you will do for the company tomorrow (promotions and raises aren't a reward for past performance but a speculative bet on the future), and then say that you wish to be paid more in line with market.

Also, keep in mind that talent is not fungible and you'll be rewarded according to your capabilities, strengths, and performance within the current salary band for your role. In hot markets, if they're not taking care of you, you need to mark to market often by seeking out new roles or you'll continually be underpaid.
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whodidntante
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Re: Manager vs. Direct report salary issues

Post by whodidntante »

VoiceOfReason wrote: Sat Jul 04, 2020 6:00 am Wow, not sure if this is an industry thing, but common sense says a manager makes more than direct reports. That is true across the vast majority of businesses. So this concern from OP is natural.
It's often true but not always. For example, in tech companies, there is a "technical career path" and the status of people managers may be lower than the most critical people who make the e-widgets.

Not everyone would consider management a promotion, but everyone wants high status and I've never had anyone turn down a raise. If you create a setup where only managers have high status, you're exposed to risk that someone will pick off your best employees.
VoiceOfReason
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Re: Manager vs. Direct report salary issues

Post by VoiceOfReason »

I see a lot of talk about tech, defense, and other highly skilled and specialized roles.

Look at most industries:

- Manufacturing plants
- grocery stores
- retail stores
- law firms
- normal departments of any mega Corp (HR, Legal, payroll, finance, customer service, etc)
- Landscape companies, construction companies, etc
- private equity firms
- investment banking

I could go on and on. All of these have individual contributors making less than the manager or boss.

I think the group on this board and those responding are from unique industries where it’s different. I understand that.

But I do not agree that it’s somehow normal for a Mgr to make less than all of their direct reports.
VoiceOfReason
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Re: Manager vs. Direct report salary issues

Post by VoiceOfReason »

KlangFool wrote: Sat Jul 04, 2020 8:32 am
VoiceOfReason wrote: Sat Jul 04, 2020 6:00 am
Wow, not sure if this is an industry thing, but common sense says a manager makes more than direct reports. That is true across the vast majority of businesses. So this concern from OP is natural.
VoiceOfReason,

1) This observation does not apply in the high tech industry.

2) It is not true in sales-related roles too. A salesperson could make a lot more than the sales managers/directors,

KlangFool
Im not familiar with high tech. But is sounds like that’s what many are referring to here.

Sales varies based on industry. In medical it CAN happen. And usually the top 10-20% reps make A LOT more than their Mgr. But the Mgr consistently makes more than the majority of direct reports.
UnitaryExecutive
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Re: Manager vs. Direct report salary issues

Post by UnitaryExecutive »

Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
Depends on a number of factors (e.g. how geographically diverse your org is, how your company handles raises promotions, etc). I was under midpoint because I was promoted several times in the span of 4 years and the amounts allocated to promotions and increases assumed being in role a few years. When I changed orgs, I negotiated a fairly sizable increase. I also deliberately joined an org that I knew aggressively zero'd out low performers to really take care of top performers. I'm at close to midpoint as a Senior Director now because of those two things.

If I hadn't changed orgs and joined an org that didn't peanut butter salaries, almost all the Sr Managers I hired as Director would have made more than me. I have a Sr Manager on my team who just hired a Manager at a higher band than him for the same reasons. Same Sr Manager also has a manager making more than him in the Bay Area where salaries are significantly higher.
Jags4186
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Re: Manager vs. Direct report salary issues

Post by Jags4186 »

I too would be ticked off if my direct reports made more than me. It’s incumbent on you to make sure you are compensated fairly. You do this by knowing what your position pays elsewhere and being able to make an argument why you should be making that.

A direct report being overpaid is not a reason for you to get a raise. You being underpaid is a reason for you to get a raise.

Ultimately, the only way to force managements hand is to have another offer in your back pocket. If you can get another, better, offer then you know your worth more. If you can’t then maybe you are compensated fairly.
UnitaryExecutive
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Re: Manager vs. Direct report salary issues

Post by UnitaryExecutive »

One general lesson that I intend to impart on my kids that'll make you much happier. Focus on what you have and what you can build, not on counting other people's money.
TechFI
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Re: Manager vs. Direct report salary issues

Post by TechFI »

rich126 wrote: Sat Jul 04, 2020 11:49 am [All of this is why I never had any interest in becoming a manager (just filled in out times, sometimes for an extended stretch when they had trouble finding a permanent person). You have to deal with ridiculous personality issues, you are more expendable, you lose your tech edge and have tougher time finding a new job, etc.
How true is this? My impression is because of age-ism people tend to move towards management especially if they want to move up to like the top 10% of the org. My understanding is that ICs make it harder to keep up, since you can never compete with fresh grads. I also observed the high-level ICs at my org are very accomplished individuals, i.e. they invent an entire language, and so my conclusion was that management is the easier way to go.
TechFI
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Re: Manager vs. Direct report salary issues

Post by TechFI »

VoiceOfReason wrote: Sat Jul 04, 2020 12:03 pm I see a lot of talk about tech, defense, and other highly skilled and specialized roles.

Look at most industries:

- Manufacturing plants
- grocery stores
- retail stores
- law firms
- normal departments of any mega Corp (HR, Legal, payroll, finance, customer service, etc)
- Landscape companies, construction companies, etc
- private equity firms
- investment banking

I could go on and on. All of these have individual contributors making less than the manager or boss.

I think the group on this board and those responding are from unique industries where it’s different. I understand that.

But I do not agree that it’s somehow normal for a Mgr to make less than all of their direct reports.
That's because these industries do not have a parallel track of ICs and Managers. In these careers, you have to advance to manager in order to grow your career, there is no IC-equivalent at the manager levels. In most tech, science and engineering roles there is equivalent IC and Manager tracks.
HomeStretch
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Re: Manager vs. Direct report salary issues

Post by HomeStretch »

VoiceOfReason wrote: Sat Jul 04, 2020 12:03 pm I see a lot of talk about tech, defense, and other highly skilled and specialized roles.

Look at most industries:

- Manufacturing plants
- grocery stores
- retail stores
- law firms
- normal departments of any mega Corp (HR, Legal, payroll, finance, customer service, etc)
- Landscape companies, construction companies, etc
- private equity firms
- investment banking

I could go on and on. All of these have individual contributors making less than the manager or boss.

I think the group on this board and those responding are from unique industries where it’s different. I understand that.

But I do not agree that it’s somehow normal for a Mgr to make less than all of their direct reports.
(In my experience) for engineer, tech/IT, scientific, clinical, R&D, product development and sales departments across multiple industries, it is not uncommon to have some ICs in a department with higher total compensation than the department head (below VP and C levels). The ICs were well worth it in most cases IMO. Sales department comp is usually higher more due to incentive-based rewards based on actual sales by a good producer.

(In my experience), for G&A roles and indirect support positions (such as order entry, lab techs, QA/QC, regulatory affairs, purchasing, indirect mfg, etc.), it’s more common for department heads to make more than their direct reports.

Your company’s compensation structure may or may not be out of whack. You need to do more research/testing the market to determine if that’s the case for your company, your department, your position. If it is, you should discuss the inequity/imbalance for your position with your department head. But if your only support for a salary increase request is that you make less than some of your direct reports, that is not a persuasive argument. Especially for < $5k.
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

UnitaryExecutive wrote: Sat Jul 04, 2020 12:14 pm One general lesson that I intend to impart on my kids that'll make you much happier. Focus on what you have and what you can build, not on counting other people's money.
Great quotes, esp for the kids. However, getting what you deserve, negotiating well are also tenets that improve satisfaction and happiness, and should be taught to kids!
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

Great context and appreciate the detailed background on your journey. Thanks!
UnitaryExecutive wrote: Sat Jul 04, 2020 12:08 pm
Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
Depends on a number of factors (e.g. how geographically diverse your org is, how your company handles raises promotions, etc). I was under midpoint because I was promoted several times in the span of 4 years and the amounts allocated to promotions and increases assumed being in role a few years. When I changed orgs, I negotiated a fairly sizable increase. I also deliberately joined an org that I knew aggressively zero'd out low performers to really take care of top performers. I'm at close to midpoint as a Senior Director now because of those two things.

If I hadn't changed orgs and joined an org that didn't peanut butter salaries, almost all the Sr Managers I hired as Director would have made more than me. I have a Sr Manager on my team who just hired a Manager at a higher band than him for the same reasons. Same Sr Manager also has a manager making more than him in the Bay Area where salaries are significantly higher.
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

Jags4186 wrote: Sat Jul 04, 2020 12:13 pm I too would be ticked off if my direct reports made more than me. It’s incumbent on you to make sure you are compensated fairly. You do this by knowing what your position pays elsewhere and being able to make an argument why you should be making that.

A direct report being overpaid is not a reason for you to get a raise. You being underpaid is a reason for you to get a raise.

Ultimately, the only way to force managements hand is to have another offer in your back pocket. If you can get another, better, offer then you know your worth more. If you can’t then maybe you are compensated fairly.
Thanks. Good points. Driving the conversation based on my new broader scope and influence will be the best place to start..
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KyleAAA
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Re: Manager vs. Direct report salary issues

Post by KyleAAA »

It’s common for ICs to make more than managers in many industries. There’s no logical reason managers should expect to always earn more than their direct reports. It isn’t an issue that needs correcting. I have managed people with TC almost twice mine, for example. That’s an outlier, but for my entire management career there has almost never been a moment where at least one of my reports didn’t out-earn me, this is the dominant model in tech.
drk
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Re: Manager vs. Direct report salary issues

Post by drk »

Wannaretireearly wrote: Sat Jul 04, 2020 2:28 am I get that things are sometimes upside down.
This is where your thinking goes off the rails. As a manager, you're in a service role. You're compared to other managers, not to ICs, and that's how you need to make your case for higher comp.

Edit: I should have read the thread because others with relevant experience have already made this point, and I had no intention to beat a dead horse.
milktoast
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Re: Manager vs. Direct report salary issues

Post by milktoast »

Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?
I’m on tech ladder but can answer question.

All the way up to VP this happens regularly in tech. But the overall company will have way more managers at Sr. Director than IC at that level. But R&D may be closer to 1:1.

In fact, some R&D orgs explicitly pair director / sr director from management and technical track. “Two in the box.” And typically the IC there would be a direct report of the manager and have higher comp.

At VP level on tech track, I’m capped. For me, that next step would require being a well known founder with PhD. Not gonna happen.

My VP boss could go exec VP if we deliver. They currently make less than I do. But my target will stay constant (goal is to lock me And the technology in place) and theirs will jump around based on business results.
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Re: Manager vs. Direct report salary issues

Post by HawkeyePierce »

TechFI wrote: Sat Jul 04, 2020 11:36 am
VoiceOfReason wrote: Sat Jul 04, 2020 6:00 am Wow, not sure if this is an industry thing, but common sense says a manager makes more than direct reports. That is true across the vast majority of businesses. So this concern from OP is natural.

In medical sales where compensation is tied to base salary and commission plans, base salary is higher to provide more consistently higher total comp. However top individual contributors on your team will always make more than manager. Oftentimes A LOT more. The Mgr role adds consistency to by raising the floor but lowering the ceiling on your total compensation.

What is the point of becoming Mgr and taking in more stress and responsibility if total compensation isn’t better in some significant way?
From an impact standpoint, it's increasingly harder for ICs to make big impact compared to managers at the very high levels. In many orgs the top-level equivalent positions have more managers than ICs.
Depends on corporate culture, but at my employer the very senior ICs definitely have larger impact than equivalent (director/VP) managers. They're considered part of the CEO's staff and drive change company wide. (5000 person Silicon Valley company)
MathIsMyWayr
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Re: Manager vs. Direct report salary issues

Post by MathIsMyWayr »

TechFI wrote: Sat Jul 04, 2020 12:26 pm
rich126 wrote: Sat Jul 04, 2020 11:49 am [All of this is why I never had any interest in becoming a manager (just filled in out times, sometimes for an extended stretch when they had trouble finding a permanent person). You have to deal with ridiculous personality issues, you are more expendable, you lose your tech edge and have tougher time finding a new job, etc.
How true is this? My impression is because of age-ism people tend to move towards management especially if they want to move up to like the top 10% of the org. My understanding is that ICs make it harder to keep up, since you can never compete with fresh grads. I also observed the high-level ICs at my org are very accomplished individuals, i.e. they invent an entire language, and so my conclusion was that management is the easier way to go.
It takes a lot of efforts to stay competitive and productive as an IC as you age. You have to hone you skills and learn new things all the time and not many can keep doing it. There are two kinds of people on the management track: those who are ambitious in the organizational hierarchy and those who cannot stay competitive technically.
rich126
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Re: Manager vs. Direct report salary issues

Post by rich126 »

TechFI wrote: Sat Jul 04, 2020 12:26 pm
rich126 wrote: Sat Jul 04, 2020 11:49 am [All of this is why I never had any interest in becoming a manager (just filled in out times, sometimes for an extended stretch when they had trouble finding a permanent person). You have to deal with ridiculous personality issues, you are more expendable, you lose your tech edge and have tougher time finding a new job, etc.
How true is this? My impression is because of age-ism people tend to move towards management especially if they want to move up to like the top 10% of the org. My understanding is that ICs make it harder to keep up, since you can never compete with fresh grads. I also observed the high-level ICs at my org are very accomplished individuals, i.e. they invent an entire language, and so my conclusion was that management is the easier way to go.
Depends on where you work. I work with a number of 40s/50s or older (one guy was around to mid 70s) technical people who prefer dealing with technology rather than people.

If you have a goal of making big money as some high level manager sure you can go for that. Actually achieving that is low. Some people can't do the technical work and look to escape it. Others are encouraged to move into management but everyone in the field knows that a good tech person often makes a poor manager, obviously some exceptions.

I do stand by my statement that middle level managers in larger companies, especially in the defense world, are very disposable. I've turned down some options in the past because I was concerned that I would lose my technical skills/knowledge and if I had to find another job it would be much harder as a manager as opposed to a computer security, programmer, etc. person.

I do have one FAANG type company interviewing me now for a job and I though it was weird because they should know I'm no 20s/30s/40s based on the experience I had put on my resume. I doubt it will get to an offer since I'm not sure I will continue with the next interview, don't have an interest in CA (I had applied somewhat of a lark but to a position back east closer to family), and may not be able to do what they want but I'm intrigued just to see what kind of questions they will ask.
flyingcows
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Re: Manager vs. Direct report salary issues

Post by flyingcows »

Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
Have you been with this company for a long time? In my experience, the longer you remain with the same company, the more likely it is for you to be paid below market rates. Especially true in segments like tech

In general, workers hired recently in to a particular level will be paid more than those who were promoted from within
stats99
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Re: Manager vs. Direct report salary issues

Post by stats99 »

I think baseball is a good analogy, who males more the starters or the manager?
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scorcher31
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Re: Manager vs. Direct report salary issues

Post by scorcher31 »

This must vary significantly by industry. In my wife's field of business (not tech) there are no IC vs management. It's just a hierarchy of promotions as you go up the ladder you get more so you are always paid more than your direct reports. It goes something like analyst<consultant<senior consultant<manager<director<senior director<executive director<VP and so on. I believe the military is somewhat similar as well there is a sequence of ranks you go through each with more pay. As a salaried physician employee in a specialty that does not do procedures, at least at the places I've worked, it's gone physician<medical director<department chair. Typically it's an upward trend in salary unless the lower level is doing call/more shifts or in a procedure based specialty. I would expect it would be somewhat for teachers, government jobs, police etc. Tech and sales must be different.
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2pedals
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Re: Manager vs. Direct report salary issues

Post by 2pedals »

I don't get it. 5k difference and it bugs you. :confused From what you have wrote so far the problem is not with the performance of the ICs. I think you should be happy that the employees are high performance ICs and helping the team perform. I would think as a senior manager you would have much bigger fish to fry. I don't see how bringing attention to this would do you any good.
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Re: Manager vs. Direct report salary issues

Post by scorcher31 »

On a side note, i never realized how many bogleheads were in tech.
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Re: Manager vs. Direct report salary issues

Post by KyleAAA »

rich126 wrote: Sat Jul 04, 2020 3:52 pm
TechFI wrote: Sat Jul 04, 2020 12:26 pm
rich126 wrote: Sat Jul 04, 2020 11:49 am [All of this is why I never had any interest in becoming a manager (just filled in out times, sometimes for an extended stretch when they had trouble finding a permanent person). You have to deal with ridiculous personality issues, you are more expendable, you lose your tech edge and have tougher time finding a new job, etc.
How true is this? My impression is because of age-ism people tend to move towards management especially if they want to move up to like the top 10% of the org. My understanding is that ICs make it harder to keep up, since you can never compete with fresh grads. I also observed the high-level ICs at my org are very accomplished individuals, i.e. they invent an entire language, and so my conclusion was that management is the easier way to go.
Depends on where you work. I work with a number of 40s/50s or older (one guy was around to mid 70s) technical people who prefer dealing with technology rather than people.

If you have a goal of making big money as some high level manager sure you can go for that. Actually achieving that is low. Some people can't do the technical work and look to escape it. Others are encouraged to move into management but everyone in the field knows that a good tech person often makes a poor manager, obviously some exceptions.

I do stand by my statement that middle level managers in larger companies, especially in the defense world, are very disposable. I've turned down some options in the past because I was concerned that I would lose my technical skills/knowledge and if I had to find another job it would be much harder as a manager as opposed to a computer security, programmer, etc. person.

I do have one FAANG type company interviewing me now for a job and I though it was weird because they should know I'm no 20s/30s/40s based on the experience I had put on my resume. I doubt it will get to an offer since I'm not sure I will continue with the next interview, don't have an interest in CA (I had applied somewhat of a lark but to a position back east closer to family), and may not be able to do what they want but I'm intrigued just to see what kind of questions they will ask.
Why do you doubt you will get an offer? FAANG hires very senior ICs all the time, and most are very remote friendly. FB, for example, has officially announced everyone can work remotely if they want. Middle management at FAANG also tend to be very technical. Why not get double the pay for the same work?
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Re: Manager vs. Direct report salary issues

Post by MathIsMyWayr »

The worst manager is one who is envious of people who report to him whether for salaries or technical competence and achievements. He will steal others' work and plays a gatekeeper in an effort to try to make sure others not to overshine him.

Shortly after the World War II, Shockley tried to make transistor work, the biggest prize of the time and a sure Nobel prize winner, but failed, and he had Bardeen and Brattain continue work on transistor. Finally, Bardeen and Brattain succeeded, and Shockley tried to grab the sole ownership of the invention of transistor. He even kept Bardeen and Brattain as far removed from the work as possible.
https://www.pbs.org/transistor/album1/a ... /egos.html
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

Jags4186 wrote: Sat Jul 04, 2020 12:13 pm I too would be ticked off if my direct reports made more than me. It’s incumbent on you to make sure you are compensated fairly. You do this by knowing what your position pays elsewhere and being able to make an argument why you should be making that.

A direct report being overpaid is not a reason for you to get a raise. You being underpaid is a reason for you to get a raise.

Ultimately, the only way to force managements hand is to have another offer in your back pocket. If you can get another, better, offer then you know your worth more. If you can’t then maybe you are compensated fairly.
Thx for the support and suggestion!
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

drk wrote: Sat Jul 04, 2020 1:09 pm
Wannaretireearly wrote: Sat Jul 04, 2020 2:28 am I get that things are sometimes upside down.
This is where your thinking goes off the rails. As a manager, you're in a service role. You're compared to other managers, not to ICs, and that's how you need to make your case for higher comp.

Edit: I should have read the thread because others with relevant experience have already made this point, and I had no intention to beat a dead horse.
Urrr. Only comment is that as a first or maybe second level manager, you still are doing IC activities too. I am....
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

KyleAAA wrote: Sat Jul 04, 2020 1:02 pm It’s common for ICs to make more than managers in many industries. There’s no logical reason managers should expect to always earn more than their direct reports. It isn’t an issue that needs correcting. I have managed people with TC almost twice mine, for example. That’s an outlier, but for my entire management career there has almost never been a moment where at least one of my reports didn’t out-earn me, this is the dominant model in tech.
Thx Kyle. I may need to get used to this for the rest of my career....
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

flyingcows wrote: Sat Jul 04, 2020 4:17 pm
Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
Have you been with this company for a long time? In my experience, the longer you remain with the same company, the more likely it is for you to be paid below market rates. Especially true in segments like tech

In general, workers hired recently in to a particular level will be paid more than those who were promoted from within
yep been with them closer to 15 years, than 10 ;)
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

MathIsMyWayr wrote: Sat Jul 04, 2020 5:36 pm The worst manager is one who is envious of people who report to him whether for salaries or technical competence and achievements. He will steal others' work and plays a gatekeeper in an effort to try to make sure others not to overshine him.

Shortly after the World War II, Shockley tried to make transistor work, the biggest prize of the time and a sure Nobel prize winner, but failed, and he had Bardeen and Brattain continue work on transistor. Finally, Bardeen and Brattain succeeded, and Shockley tried to grab the sole ownership of the invention of transistor. He even kept Bardeen and Brattain as far removed from the work as possible.
https://www.pbs.org/transistor/album1/a ... /egos.html
I get it. Thanks. I would hope im not in this category. I really do try to give others, direct reports or indirect, all the credit deserved.
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Re: Manager vs. Direct report salary issues

Post by Shackleton »

You are a “senior manager” with only 2 direct reports. I’m not surprised they make more than you.
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Re: Manager vs. Direct report salary issues

Post by MarkBarb »

Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
I was never at the director level or above. I stopped just below that. But I also knew enough about our comp structure to know that any director in my area was very likely to earn more than I did.

One other thing I'll add is that I've managed some people that were significantly overpaid. It sometimes happened when people were hired at the peaks of market swings or when specific skills were in high demand. So it wasn't uncommon to have a team where the best people on the team weren't the highest paid. It wasn't always because they were underpaid. It was sometimes because others were overpaid. That was eventually taken care of with layoffs or by just not giving significant raises to the overpaid for many years.
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Re: Manager vs. Direct report salary issues

Post by RocketShipTech »

Shackleton wrote: Sat Jul 04, 2020 6:46 pm You are a “senior manager” with only 2 direct reports. I’m not surprised they make more than you.
I’m a Director with 2 direct reports. I make $400k. My reports each make $200k.

What’s your point?
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Re: Manager vs. Direct report salary issues

Post by cherijoh »

dukeblue219 wrote: Sat Jul 04, 2020 8:10 am By the way, I see everyone in this thread using IC or individual contributor as common lingo. I've never heard that term before. Is it common in certain fields? A new buzzword? Admittedly I work in government now...
I think it is quite common in STEM (Science, Technology, Englineering, and Mathematics) fields and has been for some time. (I'm retired from a STEM-related career and know it was in use at least 25 years ago). It may only apply to people with some minimum level of experience where you might be asked "where do you see yourself in 5 years?" The binary answer would be management OR individual contributor.
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Re: Manager vs. Direct report salary issues

Post by dukeblue219 »

cherijoh wrote: Sat Jul 04, 2020 7:34 pm
dukeblue219 wrote: Sat Jul 04, 2020 8:10 am By the way, I see everyone in this thread using IC or individual contributor as common lingo. I've never heard that term before. Is it common in certain fields? A new buzzword? Admittedly I work in government now...
I think it is quite common in STEM (Science, Technology, Englineering, and Mathematics) fields and has been for some time. (I'm retired from a STEM-related career and know it was in use at least 25 years ago). It may only apply to people with some minimum level of experience where you might be asked "where do you see yourself in 5 years?" The binary answer would be management OR individual contributor.
Thanks. I'm in the government aerospace field - certainly we have the concept of line management, technical management, and engineering all as separate tracks. I'd just never seen IC thrown around outside of Integrated Circuit but everyone here seemed to know it. Ah well!
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

RocketShipTech wrote: Sat Jul 04, 2020 7:07 pm
Shackleton wrote: Sat Jul 04, 2020 6:46 pm You are a “senior manager” with only 2 direct reports. I’m not surprised they make more than you.
I’m a Director with 2 direct reports. I make $400k. My reports each make $200k.

What’s your point?
Lol. Thanks RocketShipTech.
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

MarkBarb wrote: Sat Jul 04, 2020 6:52 pm
Wannaretireearly wrote: Sat Jul 04, 2020 10:59 am I feel like this is question I can pose here:
For the experienced IT/tech leaders, was your salary highest in your org once you were at the director/sr. Director/VP level? Or did gaps still persist then too?

I understand my role is to grow and reward the team etc. However at some point the relative pain/stress of being in sr. management/leadership needs to pay off (even in tech/IT with high IC packages).
I was never at the director level or above. I stopped just below that. But I also knew enough about our comp structure to know that any director in my area was very likely to earn more than I did.

One other thing I'll add is that I've managed some people that were significantly overpaid. It sometimes happened when people were hired at the peaks of market swings or when specific skills were in high demand. So it wasn't uncommon to have a team where the best people on the team weren't the highest paid. It wasn't always because they were underpaid. It was sometimes because others were overpaid. That was eventually taken care of with layoffs or by just not giving significant raises to the overpaid for many years.
Yup, good points. Thanks MarkBarb
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fyre4ce
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Re: Manager vs. Direct report salary issues

Post by fyre4ce »

Wannaretireearly wrote: Sat Jul 04, 2020 11:35 am
gasman wrote: Sat Jul 04, 2020 11:23 am Physicians routinely answer to administrators who make FAR less than they do.
I want to keep this discussion open and cordial, it has been so far! I think the difference between medical and regular corp/tech management/leadership is different.
For example, in medical tye administrators would never comment/review/approve/improve your work as a doc. In the corp world that is expected from managers/leaders. I hope others may chime in too ;)
I realize it's not your industry, but I have personal experience in healthcare, and can say that physicians who work partly in management/administration typically make less per-hour than physicians who work 100% clinical, even though they are subordinates of sorts.

The bottom line is, there is plenty of precedent any many legitimate reasons why direct reports could earn more than you. It could also be that they got big raises when recruited from other employers, negotiated aggressively in the past, etc. Personally, I wouldn't get wound up over a $5k/year difference in compensation. I would just focus on the value you bring to the organization and make sure you articulate that value to your own management when appropriate (but you should be doing this anyway). When your compensation is being discussed (eg. annual salary review) it's totally fair to ask what you would need to do in order to earn more compensation. The responses you get will probably be honest and you should pay careful attention. I wouldn't make compensation a regular topic of conversation with your management though; they will likely view you as caring more about earning money than bringing value to the organization.
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

fyre4ce wrote: Sat Jul 04, 2020 8:46 pm
Wannaretireearly wrote: Sat Jul 04, 2020 11:35 am
gasman wrote: Sat Jul 04, 2020 11:23 am Physicians routinely answer to administrators who make FAR less than they do.
I want to keep this discussion open and cordial, it has been so far! I think the difference between medical and regular corp/tech management/leadership is different.
For example, in medical tye administrators would never comment/review/approve/improve your work as a doc. In the corp world that is expected from managers/leaders. I hope others may chime in too ;)
I realize it's not your industry, but I have personal experience in healthcare, and can say that physicians who work partly in management/administration typically make less per-hour than physicians who work 100% clinical, even though they are subordinates of sorts.

The bottom line is, there is plenty of precedent any many legitimate reasons why direct reports could earn more than you. It could also be that they got big raises when recruited from other employers, negotiated aggressively in the past, etc. Personally, I wouldn't get wound up over a $5k/year difference in compensation. I would just focus on the value you bring to the organization and make sure you articulate that value to your own management when appropriate (but you should be doing this anyway). When your compensation is being discussed (eg. annual salary review) it's totally fair to ask what you would need to do in order to earn more compensation. The responses you get will probably be honest and you should pay careful attention. I wouldn't make compensation a regular topic of conversation with your management though; they will likely view you as caring more about earning money than bringing value to the organization.
Thanks. Fair & good comments
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moneywise3
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Re: Manager vs. Direct report salary issues

Post by moneywise3 »

During the annual review, your boss must have looked at the numbers and must be OK with it. Doesn't sound like he indicated salary reconciliation is an open issue as far as he's concerned. All of this indicates they do want to pay those ICs more than you.
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Wannaretireearly
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Re: Manager vs. Direct report salary issues

Post by Wannaretireearly »

moneywise3 wrote: Sun Jul 05, 2020 12:29 am During the annual review, your boss must have looked at the numbers and must be OK with it. Doesn't sound like he indicated salary reconciliation is an open issue as far as he's concerned. All of this indicates they do want to pay those ICs more than you.
Thanks. I know HR plays a role too, not just immediate manager. They tweak the numbers etc to ensure $ are in bands. E.g. HR may bring up low paid folks in their bands etc.
The responses here have helped me come to terms with this. Its not the biggest deal, as many have said.
Also, good reminders to focus on my own performance and impact in the past and in the near future...

Again, one of the great benefits of such a smart and intelligent community here! There are very few (to no)other places I'd feel confident of posting this & receiving good feedback.... :sharebeer
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Re: Manager vs. Direct report salary issues

Post by ltermt »

A few years ago, I took a new offer as IC where I made 15% more than my manager (director level at Megacorp). The manager had quickly risen from IC to Manager to Director in a span of 3 years but the Base Pay had not increased. The manager tried to use my hiring as an opportunity to ask for a significant bump in pay. Net result,the manager was turned down and quit within a couple of months to go join a competitor. I got put in a difficult spot as the news trickled out and the new manager became hostile, forcing me to move on.
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