I was working at a Hershey plant in California about 10 years ago. The place was falling apart. So many projects needed to be done!! Upper management needed to make their quarter numbers...At all cost. It was for the bonus. After the start of the quarter (or year), all the projects (problems) got taken care of. Management said this is how it works...Or not works. Bonus and stock options drove the company...
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why are High Dividend stocks perceived to be superior?
- Thread starter believezz
- Start date
I was working at a Hershey plant in California about 10 years ago. The place was falling apart. So many projects needed to be done!! Upper management needed to make their quarter numbers...At all cost. It was for the bonus. After the start of the quarter (or year), all the projects (problems) got taken care of. Management said this is how it works...Or not works. Bonus and stock options drove the company...
I think 99.9% of people can be bought, not too many people around have strictest of values and there only so many billionaires running around, and maybe even them can be bought, seems now money is too much worth more than people or loved ones or faith, whether in USA or other countries of the world. Unfortunately, it takes Bonuses and stock options for them to get their asses in gear to do what amounts to there jobs, this shows how to me especially USA have lazy management if they won't work for regular salary. I have always believed in bonuses and if they have the ability to start from "ground up", they should have ownership period or percentage of the net all the time instead of working for it at certain times. I want them to feel they part of what they working for and up to them to make more by providing to work hard and smart.
It's a damned if you do, damned if you don't situation. If you don't, then everyone grouses about "Why the hell did the CEO make $X while the shareholders suffered a 40% decline?"Bonuses should never be paid to anyone for simply doing the job they're employed to do, only for achieving more than their contract required. And I'd love to know who had the bright idea of linking bonuses to share prices - the worst idea to hit business in years.
It turns out that a lot of research has been done on incentive alignment and share price is one of the least worst incentive alignment tools for those high enough in the organization to actually influence it. The key is to lock them into a relatively long-term relationship with their share price so that gaming won't work, which obviously is easier said than done. Especially given the relative imbalance in intellectual horsepower between most company's HR divisions and their executives.