Comments

A-Rod as MVP had a better year than most CEOs - the dilemma with CEO talent tho seems to be how do we live without them? Need a new business model where the top few aren't so financially dominate?

Posted by Sean at December 2, 2005 10:23 AM

In the book Good to Great. Jim Collins states that his research indicated that there was no link between exec pay and the long term performance (in fact if anything there is a negative link) that those that required big bucks were exactly the wrong people to put in charge.

Does anybody have a view on this?

Posted by PaulH at December 2, 2005 12:15 PM

I wouldn't worry about excessive pay - they will be the first with their backs against the wall when the revolution comes!

Posted by PaulH at December 2, 2005 12:16 PM

Paul, in reference to your comment/question, I defer to Laurence J. Peter, author of "The Peter Principle", who coined the phrase "occupational incompetence":

"When I was a boy I was taught that the men upstairs knew what they were doing..."

“Bureaucracy defends the status quo long past the time when the quo has lost its status.”

Sadly, it seems, so many are invested in hiding their bewilderment or incompetence (perhaps a by-product of their incredible compensation packages)...

Posted by Steve Dragoo at December 2, 2005 5:10 PM

On talking of CEO Compensation, the first thing that comes to my mind is what Peter Drucker wrote in his 1984 essay where he persuasively argued that CEO pay had rocketed out of control and implored boards to hold CEO compensation to no more than 20 times what the rank and file made. Does this hold true now?? I don’t think so! Anyway, does it make any difference now?? I don’t think so either!

Posted by K.Sriram at December 3, 2005 1:40 AM

Although I made a joke about "when the revolution comes" I do wonder - at what point do the poorest parts of society get so fed up that something really bad happens. If nothing else New Orleans should have shown how thin the veneer of "normal society" is.

Posted by PaulH at December 3, 2005 4:56 AM

CEO pay is outlandish but fairly close to market-driven. Granted, there may be some companies whose stock is so thinly spread among a small group of owners that the market isn't really speaking but then they are only harmimg themselves.

1. If a board doesn't want to pay the price, choose someone who will accept what you are willing to offer. That may not be a celebrity CEO, but if you don't feel the CEO makes that much difference, who cares.

2. If you own the stock of a company you feel overpays their CEO, sell the stock.

The market-driven price for a top keynote speaker is what? $50,000/hour? Maybe those CEOs are cheap!

http://www.washspkrs.com/speakers/feecodes.html

Posted by Jeff at December 3, 2005 8:29 AM

So, according to that statistics, if we continue that rythm of development, a future CEO will be getting more as well. Good enough.

Posted by Omara at December 3, 2005 4:10 PM