Tonight on The News Hour David Brooks opined that the folks running the biggest financial institutions were super-stars who deserved their exhorbitant compensation.
The 'super star' myth simply will not die.
I've pointed out before that once-successful, 'super star' professional coaches (e.g., Landry, Torre), get FIRED when they stop winning.
Hewlett-Packard FIRED Carly Fiorina for poor performance.
The David Brookses of the world insist that if these guys aren't properly compensated, they'll depart their companies and leave an unfillable leadership vacuum.
"Unfillable"??? - Why not try out new blood with new ideas... No, not recent MBA grads, but successful managers with a track record.
NO ONE PERSON IS INDISPENSABLE! - This is a fairly well-accepted business adage... at least, in the manufacturing sector (where I've some experience).
In addition - these nominally irreplaceable geniuses ARE THE ONES WHO GOT THEIR INSTITUTIONS INTO THIS MESS!!!
Why would anyone WANT to keep 'em around???
Noteworthy:
Wall Street bonuses totaled $18.4Bn in 2008.
Intel's 2008 net income? $5.3Bn.
- NOTE: Intel is the largest supplier of microprocessors in the world, with somewhere around 75%-80% market-share. They have cash reserves somewhere in the neighborhood of $12Bn.
In one of Wall Street's worst years, they paid bonuses three (3) times Intel's net income!
What's wrong with this picture?
Note: Intel makes things. You can hold a microprocessor in your hand. The things Intel makes - microprocessors - are in your desktop PC, your notebook PC, your smart cellphone, your iPod.
Wall Street financial geniuses make 'paper'... or, more recently, vapor-ware - fancy financial instruments that somehow represent money, but are not transparently identifiable with tangible things.
They exist only to create the illusion of wealth - they are not in themselves wealth.
Never forget!
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