Article

Holding onto your CIO salary in a poor economy

Zach Church, News Writer

The good news is that CIO raises don't appear to be down, despite the troubled economic times.

The bad news? Raises aren't going up either. And the poor economy has many midmarket CIOs holding back from asking for more than the usual 3% to 5% raise.

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A recent SearchCIO-Midmarket.com CIO salary survey of nearly 250 midmarket CIOs and IT managers found that 54% of them are less likely to ask for a raise in bad economic times. Sixteen percent said they were more likely to ask for a raise because of the poor economy.

But 52% of midmarket CIOs received a raise between 3% and 5%, numbers that at least match inflation, if little else. Sixty percent of midmarket CIOs said they expect a similar raise next year.

It's not all OK news. Fourteen percent of CIO salary survey respondents said their companies have implemented a salary freeze because of the country's poor economic situation. And 12% of respondents did not get a raise at all this year. Twelve percent expect no raise next year.

"I think that as companies start to feel the pain financially, there will also be some salary freezes, particularly for those CIOs that are already at the top of their pay band," said Diane Berry, managing vice president for Stamford, Conn.-based Gartner Inc.'s CIO workforce management group.

Berry said the severity of wage freezes and stifled bonuses will vary, depending on whether a company is publicly traded and what industry it is in. "[In public companies] stakeholders will want a link between share value and executive pay," she said.

"Down the road, it's certainly going to have that effect on incentive pay," she said. "I suspect that's going to be stalled."

Greg Hirte, IT manager at commercial insulation provider Bay Industries Inc. in Orlando, Fla., got a 1% raise this year.

"Normally, it's about a 3% increase," Hirte said. "Business is down.

"I told them I was disappointed and said, 'Here are the reasons why; here are all the things we accomplished,'" he said. But that wasn't enough, and Hirte went without.

If business is down, it might be best for a CIO to take one on the chin in order to save face and build a reputation as a team player, according to Martha Heller, an executive recruiter at Z Resource Group Inc. in Westborough, Mass.

If a business is struggling -- one CIO Heller spoke with said his company's product sold only 12,000 units recently, down from an expected 80,000 -- it just isn't the right time to ask for a bigger raise, she said.

You can ask [for a big raise]. If you get it is another game here.

Hans-Werner Buerger, specialist for IT performance and standards, Hollister Inc.

"If a CIO is being asked to lay people off and stop projects and put hiring freezes on … it would not behoove that CIO, from a moral perspective, from a sense of respect for the company, to go and say, 'I want a raise,'" Heller said.

"That person would not be perceived as a team player," she said. "[He] wouldn't be perceived as having good business sense."

Hans-Werner Buerger, specialist for IT performance and standards at Chicago-area medical equipment manufacturer Hollister Inc., sees things differently. Buerger said there is no harm in asking for a raise in tough economic times, provided it is deserved.

"I don't hesitate to ask, actually," he said. "I don't have in mind, 'Maybe I'll be on a blacklist.' If I believe that I'm doing a good job and I'm a benefit and a very good human asset in this company, I go out and ask for a raise.

"You can ask," he added. "If you get it is another game here." But the asking may be the point. Buerger said being an advocate for himself at the company is "due diligence" and an opportunity to mention his accomplishments over the year.

Of course, most CIOs have a contract that guarantees a raise and bonuses based on certain criteria. Heller said a well-performing CIO who is achieving the goals set for his bonuses can expect a raise of between 3% and 10% each year.

David Lewis, CIO at Desert Mutual Benefit Administrators in Salt Lake City, appears to be one of those CIOs. Some years, he gets by on a small raise. But that's not a problem, he said, because every couple of years he is rewarded with a raise as much as five times what he expected.

"I have never felt the need to go in and ask for a salary increase," Lewis said. "They have done fairly well taking care of me personally."

Lewis said he has occasionally advocated in favor of his staff.

"I do go request promotions or occasional in-grade salary adjustments if someone is performing very well, progressing very rapidly," he said.

Let us know what you think about the story; email editor@searchcio-midmarket.com.


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