A Thousand Little Pieces

[Are_grits_groceries]

Recently I had the opportunity to speak to the CEO of a large corporation based in the Western United States. The CEO's company is considering undertaking a major project in accordance with its normal line of business -- which, if executed, could result in employment (albeit temporary employment) for hundreds and perhaps more than a thousand individuals. The project would bring in substantial revenues to the company -- but would also entail substantial costs, substantial risks, and might or might not make a profit. Consumers are willing to pay for the company's product -- but they are not willing to pay what they were a year ago, and the company is having difficulty negotiating with its distributors on appropriate prices. Nevertheless the Company, which remains highly solvent, is willing to take the risk -- if it can contain its costs to what it perceives to be reasonable levels.

The rub is that the project depends on the participation of a Key Individual. Key Individual is himself quite wealthy, and has worked on many similar projects with the Company. But this time around, the Company and Key Individual cannot agree on a price for Key Individual's services. You see, Key Individual is simply not willing to accept compensation less than what he is used to for the project -- even though it is reasonably clear that the project is worth less than it might have been under better economic circumstances.

http://www.fivethirtyeight.com/

A conundrum.........

[geckosfeet]

1. No one is irreplaceable. Companies HR people need to get off their butts

and find out what kind of people they need. There are plenty of people willing to work.

If key individual is asking more than the average salary for three or four people he is most certainly not worth it. CEO needs to make standards and requirements known to all concerned, and point out that performance and innovation are key. Then make sure that they perform.