Once again, the spotlight continues to shine brightly on senior executives. Not that it shouldn’t, mind you, but some focus is deserved — some may not be.
For instance, we’ve all heard about Bob Nardelli’s $210M “severance” from Home Depot, amid falling stock prices. What you have to dig to discover, of course, is that Bob was #2 or #3 behind Welch at GE, in line for succession. When Immelt got the nod (deservedly), Nardelli and a couple of others “passed over” sought and accepted CEO jobs elsewhere. Not uncommon in the world of succession, is it??
So, to entice Nardelli to join HD, the board offered him hiring incentives — that’s right, hiring incentives — of about $180M in stock, options, deferred comp, and retirement benefits. So, $180M of this so-called “severance was, in fact, a sign-on bonus to entice Nardelli to leave an incredible opportunity and security at GE.
$20M was pure “severance,” and over $18M was in exchange for promises not to compete or poach employees/customers. Money well spent.
Get your facts straight, media.
Then, there’s Lawrence Jackson at Wal-Mart. Hired as HR chief a couple of years ago, he led global procurement and apparently didn’t quite “get it” regarding Wal-Mart’s cost reduction strategy. Jackson marks the 4th — count ’em, FOUR — senior executive to get whacked at Wal-Mart in less than a few months.
So, how about that pressure? Challenger, Gray, and Cristmas’ annual survey shows CEO departures at almost 1,500 for 2006. Almost a third has less than 3 years, and over 10% had less than a year.
Cushy job, eh??
Stay the course. The race is won by those who stay focused and don’t get caught up in things that don’t matter.