Musings on decisions and factors that drive them.
Needed: new rationale
Sat, Apr 29 2000 04:00
Yet again, we are being hit with news stories geared to practically nurture public outrage. Once again, the subject: executive bonuses. This time the recipient in question is Andrew Hall, head of Philbro, up for a bonus in the millions. I don't know which is more irritating: the large amounts in question, or the fact that these stories are becoming all too familiar both in stylistic construction and content. Big bonus. "Talent flight." Connections to "bail out" dollars. John Q. Public foots the bill.
If we are to move beyond outrage to acceptable solutions, more comprehensive thought about this compensation issue is necessary, if not by journalists, at least by the Pay Czar. Lack of clarity as to criteria for how "merit" is determined is typically at the core of any outrage related to compensation. If the public were given more than "talent flight" as the sole reason for bonuses, it would be a good place to start.
More reasons than one determine worthiness. These reasons have a relative importance. In addition, the Pay Czar must understand the full set of concerns from the public view. He must delve into the below-the-surface reasoning that drives the perceived point at which a sum of money given as pay or as a bonus switches from being reasonable to being considered "obscene" or morally reprehensible. These perceptions and concerns, too, have relative perceived levels of impact or pain.
Each potential recipient, now and in the future, should be assessed against the established criteria. The assessment must, with transparency, drive the amount granted. Additionally, integration of that merit assessment with the analysis of public perception will make decisions have a better chance of being deemed "reasonable." They will be defensible.
Without this discipline, the public will create their own myriad sets of criteria for judgment, not only for compensation granted, but for judging the Czar himself. We can then expect the focus of outrage, the topics of the articles, to shift from amounts of compensation to the capabilities of the person making the decision, in this case the Czar. And have we not heard and read similar stories in the past as well?