Thu.Nov 30, 2023

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Would you pay a high achiever more than yourself?

Berkonomics

Here’s a case study for yourself: Recently I was asked to review an offer letter for a senior director of business development. The CEO was concerned that he was offering far too much in the form of incentive compensation, with bonuses that could greatly exceed the base salary if all the bonus items were achieved. The critical question… I asked the CEO to imagine what the company would look like if all those bonus-expensive items were completely achieved in one year.