Karin Buchbinder – Death by Spreadsheet! Using Excel for Compensation

Connect with Karin:

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Connect with Dwight:

• 
• dwight.brown@salary.com

Connect with David:

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• 
• david.turetsky@salary.com

 

Podcast Manager, Karissa Harris:

• HRDataLabs@salary.com

 

Production by Affogato Media

Resources:

• Recording Location:
  
• Compensation Consulting Services
• HR Data Labs Season 5 Episode 6
• HR Data Labs Season 5 Episode 4

• “One of the largest challenges [I’ve come across working in compensation] is that a lot of companies and organizations have their processes done in Excel. . . . [The problem with this] is data integrity because that spreadsheet will get handed down from one person to another . . . with no parameters around the integrity of the data.”
• “I think people don’t make that connection [that their compensation spreadsheet is a system of record]. You need to have the assumptions written out and documented.”

Announcer: 0:02

Here's an experiment for you. Take passionate experts in human resource technology. Invite cross industry experts from inside and outside HR. Mix in what's happening in people analytics today. Give them the technology to connect, hit record, pour their discussions into a beaker, mix thoroughly. And voila, you get the HR Data Labs podcast, where we explore the impact of data and analytics to your business. We may get passionate and even irreverent, that count on each episode challenging and enhancing your understanding of the way people data can be used to solve real world problems. Now, here's your host, David Turetsky.

 

David Turetsky: 0:46

Hello, and welcome to the HR Data Labs podcast. I'm your host, David Turetsky. Like always, we try and find fun people to talk to inside and outside the world of HR to bring you the latest on what's happening in data analytics, technology and process. Today we're recording at the beautiful TWA Hotel in New York City right at JFK Airport. It is the coolest place in the world. And I'm with one of the coolest people in the world of compensation. Karen Buchbinder. Karen. Hi.

 

Karin Buchbinder: 1:13

Hi, David!

 

David Turetsky: 1:14

How are you?

 

Karin Buchbinder: 1:15

I'm great.

 

David Turetsky: 1:15

By the way. We're also joined with Karin's wonderful husband Boyd. Boyd. How you doing? He's over there.

 

Karin Buchbinder: 1:18

It really is He's looking as cool as he possibly can. Because this place is literally the coolest place in the world.

 

David Turetsky: 1:28

It is a throwback to the 60s and 70s. And Karen and I are like awestruck about this place. It is just neat. We're literally sitting in front of tab cans.

 

Karin Buchbinder: 1:41

Twister room and 1960s recreated 1960s living room.

 

David Turetsky: 1:46

And outside the window, I'm going to take a picture of it we'll post it is a beautiful TWA aircraft, four turboprop aircraft that we probably at some point in my life. I probably did take that between here in Florida. Did you ever, you flew TWA a lot, didn't you?

 

Karin Buchbinder: 2:03

I did the from Los Angeles. Yeah. To New York. Yeah.

 

David Turetsky: 2:07

To see your aunts.

 

Karin Buchbinder: 2:08

To see my aunts. To see aunt Jean and aunt Esther.

 

David Turetsky: 2:13

You know, and you know what happens when you see Esther? You take a nap. But um so today, Karen and I are going to be talking about compensation. But before we do, Karin why don't you give a little bit of a background as to who you are.

 

Karin Buchbinder: 2:29

So I've been working in compensation for about 25 years and worked in a variety of different industries, different capacities and worked both in house and done consulting on my own and have really enjoyed my experiences.

 

David Turetsky: 2:43

So is that in house versus outhouse? Sorry, toilet humor today. It's a Saturday.

 

Karin Buchbinder: 2:50

You potty mouth!

 

David Turetsky: 2:53

And one of the really fun things about this is Karin and I have been colleagues, we actually started out as colleagues back at Bankers Trust in the 90s. Let's just put it that way. In the 90s. And now we work together at Salary.com. Pleasure. The pleasure of mine, by the way.

 

Karin Buchbinder: 3:10

The pleasure is mine as well. It's great to be working with you again, for sure.

 

David Turetsky: 3:14

So Karen, one fun thing no one knows about you?

 

Karin Buchbinder: 3:18

Oh, that.

 

David Turetsky: 3:22

Oh, come on. Come on.

 

Karin Buchbinder: 3:26

One fun thing that no one knows about. I used to play saxophone in high school.

 

David Turetsky: 3:31

Wow. That is, well, there are people who know but but maybe not people who listen to the podcast. That's a good one. Right? Any good tunes that you ever belted out

 

Karin Buchbinder: 3:41

A train? You must take the A train.

 

David Turetsky: 3:45

Okay yeah, yeah, I'll take your word for that.

 

Karin Buchbinder: 3:52

I said I did on the saxophone. I can't sing,

 

David Turetsky: 3:55

Neither am I. That's why. That's why I'm a I'm not a singer. podcaster. Yeah, we'll have to actually find out if someone could dig up some of those recordings back in high school.

 

Karin Buchbinder: 4:03

Hm doubt it. Maybe!

 

David Turetsky: 4:06

Before the era the internet. So I think you might be safe.

 

Karin Buchbinder: 4:09

I think I might be safe. Phew.

 

David Turetsky: 4:11

Yeah. Yeah.

 

Karin Buchbinder: 4:13

Got it under the nick of time.

 

David Turetsky: 4:14

Yeah, I was on trumpet in high school. So

 

Karin Buchbinder: 4:16

Oh you did trumpet?

 

David Turetsky: 4:17

Yeah. So I'm glad there are no recordings from back then. People would say that I destroyed trumpet for them. But today, we're going to have a really fun conversation about compensation. Because what the thing that you may not know about Karin is that Karin is a genius when it comes to excel and access and being able to manipulate data. And that was one of the things that was remarkable about her when we met back in the 90s is that she could take any data set and just make it work. And so that's what we're gonna talk about it. We're going to talk about Excel in the world of compensation.

 

Karin Buchbinder: 4:51

Yeah.

 

David Turetsky: 5:00

So Karin, what are some of the greatest challenges you come across working in the world of compensation?

 

Karin Buchbinder: 5:05

One of the largest challenges is that a lot of companies and a lot of organizations have a lot of their processes done on Excel. And because of the flexibility it allows, you know, it allows for people to have they either overly engineer a spreadsheet, making it very difficult. And sometimes that spreadsheet becomes a legacy document in an

 

David Turetsky: 5:32

It becomes a system of record. Or bad organization decisions.

 

Karin Buchbinder: 5:35

Right, correct.

 

David Turetsky: 5:36

It's because Excel so easy to manipulate. And we take down data from the HRIS, and typically, we used to receive it in Excel, probably still do. And then we manipulate the crap out of it, we create our models in it. And one of the fun things that we used to talk about is, you know, you can make so many easy mistakes that you never catch. Very simple, formulaic mistakes.

 

Karin Buchbinder: 6:00

Yes.

 

David Turetsky: 6:01

So talk to me about... Well, before we actually get there, because I know we're going to spend an entire question on mistakes in Excel, but talk about data integrity!

 

Karin Buchbinder: 6:09

That's exactly it. It's data integrity, because that spreadsheet will get, you know, handed from one person to the other to the other. Who all have varying degrees of skill in Excel, right? And there's no parameters around the integrity of the data. It's very hard to kind of lock it in. You can lock cells, but people unlock it, you know, it's just, even with the password protection and all of that you still have issues.

 

David Turetsky: 6:32

Right. Well, you can lock down columns, you can lock down cells, but especially when you're doing mass changes, like you're doing a merit increase cycle, for example, and you're trying to spread around money, it becomes difficult to lock everything out. And then, you know, people want to just know, well, if I took this, and I did that, and I do this over here, and then they send it back to you, and you have to consolidate all that.

 

Karin Buchbinder: 6:55

It's very hard also to spot you know, the difference. I mean, we've talked about, you know, what I like about database is very easy to sort of see where there's, you know, a flaw in the data or something like that, with Excel, because it's just it, it's harder to sort of, it doesn't have that same rigor, you know, and the other thing is, a lot of times, Excel spreadsheets get way overly architected. So there could be 60 columns of data with, you know, 1000s of entries, which makes it, you know, that's that there's a high probability that you're going to have mistakes in there.

 

David Turetsky: 7:29

Oh, sure. And one of the beauties of Excel is that it's ultimately flexible, right, we can make it do what we want. And it's always served this purpose, especially for modeling compensation. Because, you know, for lack of a better way of saying it, it's the only tool or had been the only tool to actually do that kind of work.

 

Karin Buchbinder: 7:49

Exactly. Because, you know, HR systems are very expensive. And for the most part, most companies are just going to get the plain vanilla version of an HR system, because, you know, they're not going to invest in it, because it's not revenue generating.

 

David Turetsky: 8:02

Right. And Excel's free, relatively speaking. Yes. And it's ubiquitous, everybody has it. Everybody has some level of skill in Excel. You don't need to be a CPA to be able to use Excel. And so there are lots of benefits to Excel.

 

Karin Buchbinder: 8:18

Oh, for sure.

 

David Turetsky: 8:19

It's easy to use, it's easy to distribute, it's, it's easy to create some very sophisticated things and, and at the end of the day, it becomes a database. Of course, yeah, I mean, because it's so easy to

 

Karin Buchbinder: 8:28

It does become a database. And it I think it's because that people are familiar with it, that it becomes very manipulate it, it's so easy to use. And this becomes a difficult for adoption of other systems, you know, and that that mandate of I need you to do work in this system, because that's challenge because the moment you start to proliferate, those what we want, you know, if there is a system in place, that is, you know, they want to run their compensation through by default, kinds of things in an organization, and Excel becomes I believe a lot of people are just still going to go back to Excel. the de facto standard for doing increases, modeling increases It's out of our control. manager self service around making decisions, that you're

 

David Turetsky: 8:59

it's in the wild. losing data integrity, you're losing control. And I was, as we

 

Karin Buchbinder: 9:04

And then you know, again, if it's a really know, the moment that data leaves an HRIT it's already old, because changes constantly happen. And, you know, you were talking about security before. We also just don't know what else people are going to do with that thing. It's out of our control. highly manipulated spreadsheet, then updating it becomes very, very difficult refreshing the data. So you can't easily refresh.

 

David Turetsky: 9:51

Especially if they if they sort the data wrong, right? And they don't choose all the columns so they only sort certain columns. Then what happens is it becomes impossible to marry backup, right? Like I remember there was one time when, you know, managers used to just basically sort name and comp and you know, decision. And they didn't support. They didn't sort employee ID number. Yeah. So we'd have to go back and reconcile all the employee IDs with the name and make sure and say to them, you really want to give this person that increase? Because everything's all messed up now. Yeah, exactly. And you can't, in that case, intent is not understood, because you can't say what was the last change made?

 

Karin Buchbinder: 10:33

Right. And you can't trace it back.

 

David Turetsky: 10:36

There's no auditability. And the other worst case scenario is that that spreadsheet gets into the wild, as we said, and somebody gets a hold of those decisions before they become made. And now you gotta make them, you can't, you can't say no.

 

Karin Buchbinder: 10:54

And the other thing is, you know, particularly this, the market now the job market, people don't stick around in jobs as long as they used to. So you know, that, like I said that that spreadsheet go hand in hand it from one person to another, you don't know what was going on, right? Like, and that's the hardest hardest thing is when you inherit something that someone else started and trying to understand what they were, what their thought process was,

 

David Turetsky: 11:19

Right. We know that these things aren't documented at all. I mean, as you say, they're someone's creation, they were made, probably a lot of back of the envelope, algorithms going on. And so we just don't know.

 

Announcer: 11:36

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David Turetsky: 11:46

How does someone actually make it successful to use Excel in the world of compensation? Is there are there best practices? Or is there something you can do?

 

Karin Buchbinder: 11:58

Again, it would be you know, not overly architecting it making it intuitive. You know, thinking about my thought process always is if someone fell out of the sky, and in their seat, would they be able to understand what is in this spreadsheet and what the intention is.

 

David Turetsky: 12:15

You realize we're sitting in an airport,

 

Karin Buchbinder: 12:17

We're sitting in an airport!

 

David Turetsky: 12:18

Next to an airplane when you're saying, if someone fell out of the sky, so that's, yeah, it's kind of scary.

 

Karin Buchbinder: 12:24

So I could probably use another analogy.

 

David Turetsky: 12:30

Yeah, you know, I'm looking at that plane and going, so somebody's gonna fall out of that window right there. Yeah. Prophetic, actually, yeah. So so no, seriously, one of the things I think you're talking about is the falling out of the airplane is that there, you need to really document if someone's going to create an Excel spreadsheet, you need to document it, you need to document all the columns, the decisions you made on the algorithms. And I think that's one of those things people take for granted that, if I create it, that somebody will just go in and look inside the column contents and look at the formula. No, you gotta make you gotta assume that people don't know that. No, you got to maybe create an assumptions page.

 

Karin Buchbinder: 13:11

An assumptions page is vital.

 

David Turetsky: 13:14

Yeah that has the, Oh, when did we download the data? What's the effective date of the decisions? Because if this does become a system of record, and it was when it was the system we used to make the decisions, then at some point, someone's going to say, well, you know, tell me all about it. Well, this gives you that ability to do that. Right?

 

Karin Buchbinder: 13:33

Exactly. I mean, I think people don't make that sort of connection, where the I think your point is, that's exactly right. You need to have the assumptions written out and documented. Why Why would you use this range? Or what what was your decision to do basis basis for this model? You know, that the whole spreadsheet is right is designed off of, you know, there's obviously some assumptions that were made, what were they?

 

David Turetsky: 13:57

Right. Now, obviously, I'll be, as you can hear in the background, there's someone getting very upset about us talking about assumptions and documentation of that, and people are going to be upset because it's going to add a bit of administration to you know, doing this work.

 

Karin Buchbinder: 14:12

Well, that's exactly it. Because the whole point of Excel is Oh, there they grab go for it, because it's easy. But then there's also that responsibility that you need to take for, you know, explaining your work and what you're doing because you're setting, you know, a process in place.

 

David Turetsky: 14:28

Exactly. We've said this in the program before show your work, and we've heard this when we maybe this gives some people bad flashbacks to high school or for to grade school, but you know, teachers used to say, show your work, right. How did you get there? And how did you get four plus four equals nine? Like, show us how you know, it's not possible but show us how so documentation and assumptions Yeah. Hey, are you listening to this and thinking to yourself, Man, I wish I could talk to David about this. Well, you're in luck. We have a special offer for listeners of the HR Data Labs podcast, a free half hour call with me about any of the topics we cover on the podcast or whatever is on your mind, go to Salary.com/HRDLconsulting, to schedule your FREE 30 minute call today. So Karin, one last question, Will Excel ever go away as being an HR slash compensation tool?

 

Karin Buchbinder: 15:25

I think for the short term, no, potentially, if systems get more sophisticated and allow for the flexibility that's required to do one off modeling or, you know, you know, setting budgets or setting, you know, bonus pools or things like that, where you can cascade them and, you know, with a reasonable degree of flexibility, then I think there's there's a potential, I think it's the investment of money. That is, it's not there, it's right now, I mean, then there's always going to be a hesitancy because HR is considered, you know,

 

David Turetsky: 16:03

The cost center.

 

Karin Buchbinder: 16:04

A cost.

 

David Turetsky: 16:05

Well, and as we used to do the proliferation of spreadsheets and access databases, it's just so easy. I mean, anybody can do it. You know, it's, it's freely available to everybody. And the ubiquity of the tool makes it easy. And so, I agree with you, I don't think it's ever gonna really go away unless there becomes new standards created. But to be honest, you know, free is free and

 

Karin Buchbinder: 16:32

Free is free. And Excel is a very powerful tool. I mean, it's really it's gotten so much more sophisticated in recent years.

 

David Turetsky: 16:39

Oh, yeah. I mean, you can make it you can use it as a word processor, although I would really wouldn't. I mean, you know, because it does blobs, you can change fonts, you can change colors, you can get

 

Karin Buchbinder: 16:49

The macros, you can do all kinds of, you know, pivot tables, more sophisticated pivot tables now than what you could before.

 

David Turetsky: 16:57

Oh, yeah, the regression analysis are built in.

 

Karin Buchbinder: 16:59

The ability to do regression analysis in there is phenomenal.

 

David Turetsky: 17:02

Yeah. And a lot of that's been been there for a while. But if they really made it much easier, and the ability to do plugins as well, it's really great. And also, you can use the new tools like Power BI, it's really just extension of what Excel is. And so the ability to do the tab is showing up on the screen.

 

Karin Buchbinder: 17:21

The tab! Oh, that's so good. So here's the oh, here's a little thing we learned. What is tab stand for? Totally artificial beverage.

 

David Turetsky: 17:31

There you go. Totally artificial beverage. That's, that's one things you can count on from listening to the HR Data Labs podcast, something you'll learn something new every time totally artificial beverage and also that it went out of production in 2020. Didn't know that!

 

Karin Buchbinder: 17:48

The pandemic killed off a lot of stuff.

 

David Turetsky: 17:49

It did, it did. And then started a lot of things as well, like Turetsky Consulting, which got acquired by Salary.com.

 

Karin Buchbinder: 17:57

Nice.

 

David Turetsky: 17:57

So So I guess to end the conversation with Excel, it's really never gonna go away. It just, what we're suggesting is, if you're going to use it, and you're going to Document Document, document, document, make your assumptions quite well known, QU the crap out of whatever you do.

 

Karin Buchbinder: 18:13

QA! And don't overly architect it. Don't overly engineer, despite unless it's for a specific model. If it's a specific model, that's one thing. If it's a process, if it's, you know, bonus modeling something that's going to be handed around from person to person, then in that instance, you don't want to over architect it.

 

David Turetsky: 18:35

And document the crap out too.

 

Karin Buchbinder: 18:36

And document, yeah.

 

David Turetsky: 18:46

Well, Karin, thank you so much.

 

Karin Buchbinder: 18:47

Thank you very much.

 

David Turetsky: 18:48

It's been a pleasure to have you on the program.

 

Karin Buchbinder: 18:50

Thank you!

 

David Turetsky: 18:51

And hopefully we'll do that again soon.

 

Karin Buchbinder: 18:52

I hope so too.

 

David Turetsky: 18:54

Well, this is David saying thank you so much to you, the listener and thank you to the TWA hotel, and Boyd for being very patient. Take care and stay safe.

 

Announcer: 19:04

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