[simonh]

This is the Pareto Principle at work. 20% of the people involved in an enterprise produce 80% of the value. It’s not that you don’t need the other 80% of the people, it’s that it doesn’t matter who they are.

If you remove the people in the high productivity group and replace them with people from the low productivity type then the organisation loses (roughly) 80% of its productivity. Replace people in the low productivity group and nothing happens.

Yes I agree it’s galling to see a few people compensated so highly in these situations, but as has been pointed out a) they individually most likely had little or nothing to do with bringing the problems about. b) What else are you going to do? The alternative is let the most critically essential personnel go and watch the whole organisation seize up for good.

[HPsquared]

There's also Price's Law: half the value is produced by the square root of the number of people.

[_v7gu]

If you have a calculator on hand, could you post the n such that these two rules are equivalent? It’s wrinkling my brain.

[marcianx]

How can you? One is taking about 80% of the work and the other is talking about half the work. You would need a distribution of the work impact across the employee population first.

[_v7gu]

The Pareto rule (at least my interpretation, due to its similarity with a power distribution) is recursive: 80% completeness from 20% work also implies 64% completeness from 4% work which in turn gives 51.2% completeness from 0.8% work (half of success is just showing up).

Accepting 51.2% as an approximation to half, the problem becomes 0.008 x = sqrt(x) which gives x = 125^2 = 15,625

[gbacon]

If it’s galling for the essential people to be paid more, what’s a fair compensation structure in your view?

[simonh]

I think there’s no avoiding paying people what is necessary to retain them. The alternative would be worse for the company and its other employees if essential talent was lost, or would be coercive and intrusive of the freedoms of these people if they were somehow compelled to continue working against their will and personal best interests.