Storytelling About Index By Compa With Charlie Franklin

William Tincup: [00:00:00] This is William Tincup and you are listening to the Use Case podcast. Today we have Charlie on from Compa where we were talking about a product that they’re launching called Index. So a little bit, we’re gonna talk a little bit about Compa and then we’re gonna be talking about this new product that they have.

So Charlie, would you do us a favor

Charlie Franklin: and introduce yourself? Yeah, thanks William. Thanks. Rob me on? Sure. Hey everyone, my name Charlie Franklin. I am co-founder and.

The first decade in my career in hr, primarily as a compensation practitioner, and was most recently a workday [00:01:00] acquired upon compa.

William Tincup: And so you know, how to build really sophisticated spreadsheets is what I learned right there is you can’t be in compensation and not know how to build sophisticated spreadsheets, right?

I

Charlie Franklin: used to joke half seriously that I would much rather blindfold myself and unplug my mouse. And use my keyboard and Excel than your crappy software product. So as a comp person, I love Excel, I love spreadsheets.

William Tincup: You can do things with pivot tables that no one can do. Yep. Oh yeah. Oh yeah. So tell us a little bit, what does compa do?

So

Charlie Franklin: compa is you can think of it as a new way to think about compensation market data based on offers. And so we’ve built. A piece of software that’s trying to solve a singular problem for comp completers, which is that they’ve been flying blind for the past couple years as the market rose up and crashed down.

Now [00:02:00] because Comp Completors use surveys to measure the market, and that made sense when things were slow, it makes less sense now when the market’s volatile. So I compare it to, imagine you’re trying to buy some stock in the stock market and the only thing you have is a list of published prices from last year.

How would you know what to spend? Doesn’t make sense.

William Tincup: No. And people that need that data, let’s say talent acquisition, if it’s a recruiting question they need the most up to date. Data that they can possibly get their hands on because the market for talent, it moves. It’s, it moves like gasoline prices.

You can be that far off four or five, 10 days later and you have to know And I think that intelligence helps everyone. It helps hr, it helps internal mobility from retention standpoint, all kinds of things. But for Tali, again, getting that data in the hands of people that need to, again, you’re either gonna be [00:03:00] below market rate, at market rate or above market rate.

And That’s

Charlie Franklin: right. And go ahead. I’ll just add William that, look, as a former comp person, I didn’t spend as much time with the talent acquisition team as I should. I think these folks are just relatively siloed possibly even frenemies in some organizations. And as particularly with respect to whether it’s saving money or figuring out how to get more talent in the door faster, offers and what the Tali team is doing every day in the market, is this tremendous. Has tremendous potential to serve, not only, the comp team’s ability to read the market in real time, but also to serve back. I total reward strategy that’s actually gonna impact whatever the business is trying to do.

And so it’s strange they’ve been overlooked. I was guilty just like most other comp people when I was in that position. So that’s what we’re trying to fix is kinda unlocking the source of data. Yeah.

William Tincup: Yeah. And it’s an inefficiency [00:04:00] that two parties care about. They have different interest, but aligning those interests again like something as simple as, okay, hey, we need this software engineer.

We need ’em now. They want an extra $25,000. That sounds like an easy decision for a Tali leader. Like $25,000. I get the hiring manager off my back. Yeah, done. The problem. When’s right when you don’t think about it from a macro perspective is that’s, that $25,000 now creates an inequity. That’s right.

Like the unintended consequence I think, is just we need that person. We needed them yesterday. Those lines of code aren’t being written $25,000. Easy check to write, but they’re not thinking about what it does, especially with pay equity issues.

Charlie Franklin: I always talk about the three-legged stool of cost, competitiveness, and fairness.

And it’s exactly what you said when you issue that $25,000 signing bonus. You’re creating, what we joke is called an act of cash, where it’s just, you woke up in [00:05:00] one side of the bed and it’s a 25 k sign on, you woke up in the other, it’s a 20 k sign on now that sounds un charitable towards recruiters.

The reality is they have a hand tied in their back and they don’t have the data they need and they’re trying to get the job done and that’s a pay equity issue too. But if you look at and say, Hey, we’re gonna do that signing bonus. A thousand times this year, now you’re creating a 25 million spend on signing bonuses.

How do you know if that’s the right decision? You could be looking at things like what percentage of offers signing bonuses win versus what percentage don’t, and not only in your own offer data, but in the market. And this is an era of pay transparency, which, yeah, there’s regulations coming in place, but what this is really about is just a level of scrutiny and accountability.

Yeah. On this type of spending that just you can’t just make it up anymore. The old euphemism, comp is art and science is going away. Yeah,

William Tincup: It’s also raising the literacy of everyone, everyone in the organization to understand why this [00:06:00] data is important and what you can do with it.

Data creates the insight. Insight creates action. And again, you can do something with it if you’re informed, but you have to have the data, and you have to have that insight. Now, tell us a little bit about Index. What is this is obviously a new product for Campo. What is Index?

Charlie Franklin: Yeah, so this was born out of what our team’s been doing with offers and offer management for the past couple years.

We previously had in the market only a product design for recruiters as a workflow to create offers. But what was requested over and over again by our customers was, Hey, this offer data is really valuable. Once we’re able to analyze at apples to apples, can you connect? Our offer data to other companies offer data to create this sort of network of market data.

And so that’s exactly what we’ve done. This is a new product that integrates with applicant tracking systems, so Greenhouse, workday, smart recruiters, whatever it is, and it’s [00:07:00] extracting and normalizing the offer data from your organization’s market activity and contributing it to a pool of participating companies in a give to get model.

And then returning that data back as real-time market data based on offers. And for us and our customers that have initially privately launched with us, the number one thing they’re trying to understand, it’s actually with respect to stock compensation. And so this is in the tech world where if you look, I mean go to Google Finance and look at any tech company stock over the.

Spoiler alert, you can’t just increase the number of shares you grant to employees by two times, right? You’re gonna have to pull down your equity guidelines. The question is how much and how competitive is the market still? There’s all these layoffs and supply shock of talent coming in.

What do we do? And so offers are a really [00:08:00] interesting way to study this because then you can see here’s exactly how much the market has come down as recently as last week. In terms of offers getting accepted and rejected at what rates, and you can also see the average win rates. And what we’re seeing is prices continue to fall, acceptance rates continue to rise, which suggests that we haven’t hit bottom yet.

Compa Index is a tool for compensation teams to predict where the market’s going and adapt in more real time.

William Tincup: The data, so the give to get model. So of course companies that then subscribe to this, they’re giving their data out of their ATS. So that’s both the offer data and the win rate,

Charlie Franklin: right?

Yeah. That’s right because we get accepted and rejected offers. And then we can calculate things like the offer volumes, the win rate, the prevalence of different PA elements in offer packages like assigning [00:09:00] bonus, even things like the housing market of in the housing market you study how long did the house sit on the market before it closed?

We can measure the same thing with, how long was a wreck open before an offer wrapped up in the marketplace?

William Tincup: That’s right. That’s and how many ATSs are we integrated with right

Charlie Franklin: now? All the major ATSs. Chances are, whatever you’re using, we can hook up to it.

And the beauty of this product is fairly easy because it’s. It’s really thinking as automated data exports, which pulling outta table offers. Yeah. One way passive no p ii. Beautiful thing. And for comp people, they’re used to buying survey data where they contribute and so it’s just a well worn path for these folks to participate in the model like this.

William Tincup: They’re used to buying data from like the pay scales and BLS and salary dot coms and all of those folks, which is great. Again external market data is always important, but this is, it seems more real to me because you’re inside an ATS and you can see all the way [00:10:00] across, all the way to basically offer accepted and now the person’s an employee.

You can see the time, the steps. All of that stuff. And again, if it’s, if it, I’m not, if it’s it’s metadata because you’re bringing that up and, it’s not, there’s no privacy issues, so there’s no concern. Like you get to see Tammy’s offer letter versus Johnny’s offer letter’s the, that, how do you normalize job titles?

Or the apples to apples, I guess is what I’m trying to figure out. Yeah.

Charlie Franklin: For comp folks listening, look, you rely on surveys for a reason. Yes. They lag the market. Yes, the data updates at Best quarterly, but companies only change, people’s pay usually once a year.

But what’s good about surveys is they’re leveled and matched in a very reliable way. And so what we’ve tried to do with Compa Index is marry the combination of. Really high quality job [00:11:00] matching.

And so when data. We level and match against our standard job architecture. And if you participate in one of the major surveys, Mercer, Radford, whatever it is if you’d you can volunteer to share how you match against those surveys to use sort of a Rosetta Stone against Compass structure to just build confidence in how the data is matched.

And that’s kinda the key thing here is this is not another sort of. Know alternative crowdsource data thing that you can’t really use to build comp strategy. This is meant to serve large enterprises at scale, trying to figure out what the heck is going on in the market. Because their surveys just haven’t kept up as things have started to move more quickly.

So matching is huge. It’s something we paid a lot of attention

William Tincup: to. Yeah. Obviously we know the compensation people are gonna love this because it’s right up their alley and it gets ’em closer to what’s actually happening in the [00:12:00] market. I could also see usage from finance and Tali leaders as well, finance, they’re always trying to right size costs.

They’re always trying to make sure that you know that they’re. Physically responsible and running the business in a, in an appropriate way. And for the Tali folks and even HR in general, I can just see them falling in love with this data as well. Again, I. Most offers that go out that aren’t linked to comp, it’s a mixture of their experience, what they feel, what they think the candidate wants.

You know what I mean? There’s a lot of voodoo and mysticism that happens in Tali to get people on board. And this kind of, I think it would give them insight into. Okay. There isn’t voodoo and mysticism. This is the math behind everything, and this is what your win rate, like something as simple as here’s what your win rate should be.

Here’s what the average is. Here’s what the, here’s what it looks like for companies your size or whatever industry, et cetera. [00:13:00]

Charlie Franklin: We We hear from our customers this sort of prevailing theme of come for the market data, stay for the internal offer reporting, right? And what they mean is Hey listen, it’s really helpful to get a better measure of the market.

And that certainly serves the comp team and setting strategy and updating guidelines and so forth. But all these other stakeholders, whether it’s hr, business partners, talent acquisition, Or the actual senior management themselves. Just having better visibility into what you’re spending on offers is huge.

And this is something that’s been just historically underserved by applicant tracking systems. That’s not what they’re designed for. So for example, we had a customer onboard with us back in March that. The comp teams, we asked them, Hey, do you do relocation bonuses? And they said no, we don’t do that.

Okay. So we popped the hood on the ATS, we’re configuring, integrating all their [00:14:00] data. We discover this relocation bonus field and said, do you know about this? And said, no. And we summed it up and they spent 8 million on relocation bonuses in the last six months. Nobody in comp knew it. So if you’re, in comp or finance and looking for a way to save some money, offers might be a good place to look.

It’s an unusual market. There tend to be a lot of acts of cash that happen at the new hire stage because recruiters are doing their best to get butts in the seats. But having visibility there, Feels like a no-brainer. Yeah.

William Tincup: So creating standards, it’s the wild West, what you just described to me.

It’s very much something recruiters would do and do all the time because they their interest and their measurement is just different. And so going outside of the box, if that’s what it takes to get that person on board, they’ll do it. But. It’s create and knowing that it’s also creating, again, the possibility of [00:15:00] inequities.

It might not happen, but it might be. John got a relocation bonus, Jane didn’t and their peers. And it’s just, that’s right. Cause the of inefficiency, inefficient, it’s not, I mean it could be something more, sinister than that, but it could be just one recruiter offered it up because they wanted to make sure to close the deal and the other just didn’t think they needed to.

And you about, and it lands in comp and comp’s gotta reconcile that. Okay, now what do we do to get these things equal or closer to equal?

Charlie Franklin: That’s right. Yeah. Offers are the cause of and solution to all pay problems. It’s where everything starts. Everything is downstream of the offer. And the irony is we put belts and suspenders around things like comp planning, where we’re not gonna increase your pay 3%, but there’s no standards around all the, Acts of cash that can happen at the [00:16:00] offer stage.

And I’ll, just to double click on something you said, I don’t think for the average organization or average recruiter, there’s anything sinister happening, I think it’s just one hand, not talking to the other.

Yeah, we just gotta get visibility into the data and better understands what we’re trying to

William Tincup: accomplish. A lack of standards, a lack of literacy, lack of insight or visibility into what’s going on. Again, once that’s there and everybody has that, and then if somebody does something sinister, it’s pretty easy to call it sinister.

But that’s right, right now it left hand’s not talking to the right hand. And I think that’s again it. It impacts comp and everything that in comp, it impacts the organization because the younger generations want more pay transparency. They want to, there’s more fairness around pay. They wanna make sure, whereas in, in generations passed, if John got that relocation bonus, Jane didn’t, they would’ve written it off as well.

John’s just better at [00:17:00] negotiating and no, that’s not acceptable

Charlie Franklin: anymore. It’s not, we’re there is a generational shift. We’re entering this era of pay transparency and what hits the headlines are all the regulations we’re seeing come online in different states across the US and around the world.

Really what it comes down to it’s a shift in social contract between the employee employer. There’s just a greater level. Of accountability and scrutiny going into how folks are paid. And so when I think about, what is pay transparency, it’s this shift from secretive and discretionary to more open and accountable, where differences in pay are measurable and objective at scale.

And there’s the new set of tools needed to serve our talent in a transparent world.

William Tincup: So you’ve released index to your customers and the release that you’re going through right now is kinda a more, a release to everyone. So for folks that aren’t [00:18:00] compa customers right now, can they buy index without buying compa?

Yes. Can they yeah, go ahead.

Charlie Franklin: That’s right. Yeah. So Compa Index is generally available to compensation teams. We are primarily focused on enterprise technology companies. Our team jokes cuz we, we talk with companies outside of tech all the time and will say that and they’ll raise their hand and say we’re a tech company too.

That’s right. Yeah. At first I’m kinda like John Deere,

William Tincup: but John I had this discussion with John Deere a couple years back and, Oh, sure. They’re

Charlie Franklin: launching satellites. That’s right.

William Tincup: They’re like, for tech company, we view ourselves as a technology company. I’m like, I view you as a tractor company, but Okay.

I’ve gotta reconcile that. And I think Wall Street did this about a decade ago where they woke up and went, we’re technology companies. And absolutely created a kind of a rift in Silicon Valley because they could just throw money at software engineers which was not great for everyone, but so they can, [00:19:00] it is decoupled.

They can decouple one from the other and buy compa index.

Charlie Franklin: That’s right. Yeah. This is available for comp teams. It’s. It’s very simple to get started. You do not require any change in what your recruiters do today, right? It just hooks up automatically to the ATS, and then what you get in comp is the source of real time market database on offers.

Wow. And visibility into your own internal offer spend, and we can get you up and running as soon as a week. It’s pretty

William Tincup: fast. Oh, that’s fantastic. What’s success with a product launch like this? What are you and the team, what are y’all viewing a month from now? What is success for y’all?

Charlie Franklin: It’s fascinating as a former compensation person launching a new market data product because, The first thing I would ask is, okay, new market data product, what’s the end count? How many companies are actually participating in this? And [00:20:00] the answer is, selling a market data product that’s new, it’s not really selling, it’s a coordination game.

It’s Hey, listen, do we all need a source of data that’s better? That’s enterprise grade, that’s real time. That sheds light onto our own pay practices in a way that’s very hard to see today. And the question for you is are the relevant companies, the companies you care about already participating?

If they’re not, link up, hold hands, and take a step forward and dark with us? That’s exactly what our launch partners have done. We have over 30 companies already committed. We’re growing very quickly. So if this is something that you wanna participate in, there’s a good chance we’re already working with companies that you already referenced.

But even if. Give us a phone call, we’ll talk through and see if there’s a way to help coordinate and bring these other companies in. So for us, success is building a network a data network of companies contributing data. But then more broadly, we’re increasingly [00:21:00] seeing our own company as a community network, right?

That’s really enabling these comp folks to just know what’s happening out in the market.

William Tincup: And the beauty of this is the more companies you get, the more industries size of company, all of that stuff, right? The better the data, because then they can actually, as a customer comp professional, you can go in and look at yourself, and then you can look at yourself against companies that are like you and look at, that’s right.

How far are we and aligned? Or, how far are we off from, what else, what other companies are doing. What I love is it’s not just one thing. It’s offer acceptance. You can look at just that. Not nothing else, just look at offer acceptance. Like how far are we? Are we close to the norm?

Are we too far away from the norm? Like just that alone is a wonderful discussion with Tali leaders. It’s okay, let’s just, that’s right. Like I could see that people having a Zoom call and going, Hey, let’s just look at offer letters. Here’s what ours is and here’s what six other folks that are like us, and here’s what it looks like.

And [00:22:00] just, okay. Yeah, that’s right. Now what do we do with that? Which, leads to once in, once you have the insight leads to action. So I love what you built, Charlie. I love it.

Charlie Franklin: Thank you, William. Yeah it’s been a lot of fun bringing this one into the market. And, it’s something that people really want.

We’ve been amazed by the response we’ve gotten so far. We’re thrilled to, to finally announce this publicly and graduate from spreading word mouth. Invite companies to give it a look, see if there’s something that can help you, really understand what’s going on in the market today instead of flying

William Tincup: blind.

Yeah. The beauty is it’s customer led. You weren’t really, this wasn’t really something that you were thinking about immediately. It was on all, obviously was on the roadmap, something you cared about, but because your customers kept knocking on the door asking for it, it’s okay.

At one point, you build them what they want. And so I love products in our space that are built that way because customers wanted them. So I love it. And thanks for coming on to podcast, brother. Yeah, you bet.

Charlie Franklin: Thanks a lot, William. Thanks for having me on.

William Tincup: Absolutely. And thanks for [00:23:00] everyone listening.

Until next time.