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Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

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Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#121

Post by Produce »

ThomPete wrote: post #103
rayiner wrote: post #97

Earlier quoted context omitted.

Again, you're conflating supply and demand with contribution.

Contribution as a term here is fluffy. I know what you are getting at but it makes no sense using it for some sort of comparison. What you need to look at is impact of decisions. If the CEO makes a wrong decision the entire company can go down. If a worker makes a wrong decision it's much less of an issue.

>If a worker makes a wrong decision it's much less of an issue.

Unless the employee gets his hand caught in a machine, the press jumps all over it and stocks plummet 5%.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#122

Post by rayiner »

twoodfin wrote: post #118
rayiner wrote: post #91

Earlier quoted context omitted.

I'm not arguing that the CEO is overpaid. I'm pointing out that the amount the CEO is paid is not determined by value to the company, it's determined by supply and demand in the labor market.

But, and I shouldn't have to say this it's so obvious, there wouldn't be demand in the labor market for CEOs if boards/shareholders didn't think elite CEOs provided value. There has to be a strong correlation there or the inefficient company paying a low value CEO too much will be out-competed by another company with more sense.

This can be refuted by a simple counter example.

Say CEO X provides V units of value to the company. What should CEO X be paid (P)? It has nothing to do with Y, except in the degenerate case where P > V. P is going to be determined by the supply of CEO's with credentials similar to X. P can vary dramatically depending on that supply, but obviously V doesn't change.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#123

Post by jasomill »

rayiner wrote: post #25
kapilkale wrote: post #18

This is great, but this statement from the author is a pretty terrible assumption: "It's nice to see an executive giving away a huge chunk of money to the employees that had as much to do with Lenovo's successful year as any executive within the company"

Why? Here in the US we have a cultural flaw where we irrationally conflate equilibria in the supply/demand of labor with distribution of credit for a company's success. The CEO gets paid a lot more because there is a much smaller supply of people who have the pedigree/qualifications to be CEO than to be a line worker. There is no chain of logic that can take you from there to the conclusion that he's more important t…

I agree. Often overlooked is that not all qualifications directly relate to "running the company": relationships with people who hold high-level positions in other companies, governments, academic institutions, and other organizations also play a role. Executive and director biography pages for large public companies always make entertaining reading.

To take just one random, high-profile example: David Ebersman, Facebook's CFO, while by all accounts a knowledgable and hard-working guy, was also the protégé of one Arthur Levinson, chairman of the board of Apple. This is the kind of thing that may be totally unimportant to Facebook's day-to-day operations, but that could also be very useful at some unknown point in the future (when negotiating to integrate Facebook products into as-yet-unreleased versions of Apple's mobile OS, say).

Investors also pay attention to "who's who" in the executive suite, which is important to many companies.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#124

Post by vacri »

larrys wrote: post #101
famousactress wrote: post #33

Cynical wondering: Is this real, or a clever way to package company-wide bonuses for PR? Seems like if your company just had a great year and you wanted to boost morale with 300$ bonuses, this is a way to do it and maximize press and positive attention in the process.

I don't think that it's cynical at all to consider that. I wish people also would stop jumping all over someone just because they raise a particular possibility for consideration and debate (noting you prefaced by saying "cynical wondering" to lessen the ire of anyone who might jump on you for being cynical.) One issue though. I wonder what the tax aspect is of getting a 3 million dollar bonus and giving it away. The…

So by "recently received" Yang received the money.

Not at all. It may have been calculated and declared, but the actual funds not transferred yet.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#125

Post by dannyobrien »

harryh wrote: post #64
zobzu wrote: post #50

Earlier quoted context omitted.

I think that's incorrect. It's not like if being a CEO was harder that many technical jobs. In fact, it's usually a whole lot easier. It is however about the amount, you're right on that. There is 1 CEO and there are 10 000 employees. It's much easier to pay 1 CEO "a lot" than 10 000 employes "a lot". (and to become CEO you have to look good/smart/etc but you don't have to be or work hard . You can however stab peopl…

Being a CEO is way way way way way way way harder than individual contributor technical jobs. The breadth of skill and degree of dedication required to do the job well is just insane.

Cite? I know CEOs, and I know factory workers. They wouldn't be able to do each other's jobs.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#126

Post by koide »

ajross wrote: post #106
famousactress wrote: post #33

Cynical wondering: Is this real, or a clever way to package company-wide bonuses for PR? Seems like if your company just had a great year and you wanted to boost morale with 300$ bonuses, this is a way to do it and maximize press and positive attention in the process.

Or more subtly cynical: it's a way to boost net wages without actually increasing salaries. This is a real problem in the PRC, where the enormous trade surplus has left an artificially depressed local currency. Workers are being paid much less than they should/would be in an unrestricted exchange environment. The whole point of the managed exchange rate is to keep salaries low of course (and thus preserve that trade…

This one gets my vote.

But I honestly don't see what's the problem with such a technique. Of course it would be better for the employees to get a raise. But it would certainly be worse to get nothing at all.

If they get something (money) and the company gets something (loyalty), it's a win-win. Could be better for the employees, I agree, but that's a bit unrealistic these days for the reasons you mention.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#127

Post by eliasmacpherson »

twoodfin wrote: post #119
eliasmacpherson wrote: post #34

Earlier quoted context omitted.

I would take 10,000 Nokia staff over Elop any day of the week.

Our numbers are getting out of hand here: Elop doesn't make close to 10,000x a typical engineer at Nokia.

It's a bonus, not salary, the fact that it is > 10,000x a typical bonus speaks volumes.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#128

Post by numbchuckskills »

famousactress wrote: post #33

Cynical wondering: Is this real, or a clever way to package company-wide bonuses for PR? Seems like if your company just had a great year and you wanted to boost morale with 300$ bonuses, this is a way to do it and maximize press and positive attention in the process.

Really? Most ceo's get great performance based bonuses. $300 could be a lot depending on where the employees are located.

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#129

Post by yaix »

The question is, why does the CEO get 3 Million USD as a bonus in addition to his pay, while the secretary makes only about 300 USD a month?

Its a good guesture of the CEO, no question. But it highlights the perverse difference in income between the different levels of employees. http://en.wikipedia.org/wiki/Gini_coefficient

Re: Lenovo CEO Gives His $3 Million Bonus to 10,000 Employees

#130

Post by nateburke »

eswangren wrote: post #77
nateburke wrote: post #29

Guts. This guy has guts. Hoarding away a 3m bonus like that has an implicit statement of "I'm afraid for my own fiscal future to the tune of 3m dollars" stamped on it. Instead, he gives it away, telling the world and his employees that he is confident, nay, OPTIMISTIC about the company's future. To contrast, take the typical American CEO: he or she would have taken this money, offshored it, spent another couple of ye…

It's easy to call people cowards when you're not in their situation and likely never will be. I'd like to see what you would do if you actually made that kind of money.

Since you asked: http://www.globalgiving.org/projects/solar-for-salamale/
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