I was at HP during the Platt, Fiorina and part of Hurd years. Prior to that experience I was as skeptical as anyone about CEO compensation, impact and contribution. How much difference can one person make?
Well, clearly a huge difference. Under Platt HP had good consistent growth, and we enjoyed record profit sharing and bonuses. Fiorina joined and managed to cut the company's value by 50% in three years. Hurd joined and the company's value went right back up. The difference in execution and competence was startling.
IDK, but the real story must surely be the board of directors (which hires, fires and sets the salary for the CEO). How can a board be so incompetent that it negotiates a severance package whereby Fiorina receives $42 Million to leave after loosing half of the company's value.
When you look at the following graph, keep in mind the Great Recession in 2008.
Fiorina's compensation was arranged by a board that everyone acknowledged was hopelessly dysfunctional (see Mark Hurd and the spy scandal).
There's this claim that CEO compensation doesn't correlate well performance. I could see your Carly Fiorina and raise you Steve Jobs or Jack Welch or any other number of anecdotes. What's the real statistical correlation in the S&P 500?
Well, clearly a huge difference. Under Platt HP had good consistent growth, and we enjoyed record profit sharing and bonuses. Fiorina joined and managed to cut the company's value by 50% in three years. Hurd joined and the company's value went right back up. The difference in execution and competence was startling.
IDK, but the real story must surely be the board of directors (which hires, fires and sets the salary for the CEO). How can a board be so incompetent that it negotiates a severance package whereby Fiorina receives $42 Million to leave after loosing half of the company's value.
When you look at the following graph, keep in mind the Great Recession in 2008.
https://commons.wikimedia.org/wiki/File:HPQ_Stock_Price_Sinc...