“The chairman and chief executive of Union Carbide Corp., in an unusual move, bet on his company’s performance, agreed to forfeit a year’s salary if the chemicals company doesn’t meet its earnings target for the year 2000” according to a recent The Wall Street Journal article. [i] Would you put your salary at risk?
Jack Welch, the CEO of GE, was the nameplate Brand U leader for much of the last decade. What made him so effective? He always focused on performance. One person who worked for Welch said every limo or elevator ride would be an opportunity for a performance review. “A general manager’s quarterly and year-to-date profit and loss variance analysis takes minutes. And the variance is measured not against the budget but against what the manager had promised.”[ii]
[i] Ewing, Terzah, “Carbide CEO to Forfeit Pay if Goal is Missed,” Wall Street Journal, September 25, 1997, p. A3.
[ii] Allen, Michael, “Another Jack Welch Isn’t Good Enough,” Wall Street Journal, November 22, 1999, p. A22.