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> That's why great leaders punish themselves Is it still a punishment if you still end up with a higher compensation compared to previous year?

by diggan 2y ago

jjmarr 2y ago
If you got "needs improvement" on your performance review and missed your target bonus, but the company's stock went up 30% meaning your total compensation still increased, what would you expect? Would you consider that to be a fair punishment? The standard Nadella is setting is that cash bonuses needs to be determined by cybersecurity impact, and that expectation needs to be in every part of the company. So he cut his (non-discretionary) cash bonus by 50%. He could've cut his stock package as well, but you're not going to work at a company where meteoric increases in the stock price can be clawed back if your performance was bad. People would freak out and ask if their stock would be cut if a cybersecurity incident occurred.
- glimshe 2y ago
  A "needs improvement" is a kiss of death for a normal tech worker. For him, it makes him look humble and deserving of the tens of millions he'll get anyway. Gosh, he might even brag about it.
wenc 2y ago
Yes, why would it not be? It’s still skin in the game. If we think it’s a symbolic gesture, which it may well be, it is still a gesture that most CEOs would not have made. Unlike most here, I don’t think with this he’s saying please punish me for wrongdoing, but more I take responsibility for this failure (which could have happened many levels below him) and will take the loss personally. Sounds like HN folks would love for Nadella to completely reduce his salary compared to last year. I don’t know that I agree. I’d say, let’s see you do it.
- diggan 2y ago
  > Yes, why would it not be? It’s still skin in the game. [...] and will take the loss personally. Because there isn't any loss overall? His compensation went up 63%, what are these losses you're talking about? If his total compensation actually went down, I'd totally agree with you. But it didn't, which is why I don't understand how this is seen as "great leaders punish themselves".
  - jjmarr 2y ago
    He would've had 5 million more dollars this year if he didn't ask the board to change the terms of his contract to give him less money. https://en.wikipedia.org/wiki/Opportunity_cost https://en.wikipedia.org/wiki/Opportunity_cost
    - diggan 2y ago
      Yeah, so he would have gotten $84.1 million instead of what he really got, only $79.1 million. Imagine being a CEO yet so poor.
      - wenc 2y ago
        So if I’m hearing you right, it sounds like you’re looking for net loss to justify the statement that “good CEOs punish themselves”, a statement made by another HNer and not by Nadella himself? He did take a loss but not a net loss, so it didn’t go far enough is what I’m sensing? Thus it’s an empty gesture devoid of any commitments to improve? For me when I see gestures like this, I’m like oh ok. At some level I know it’s symbolic but it still sends a good signal. It doesn’t scream hypocritical to me.

> That's why great leaders punish themselves Is it still a punishment if you still end up with a higher compensation compared to previous year?

by diggan 2y ago

> That's why great leaders punish themselves Is it still a punishment if you still end up with a higher compensation compared to previous year?

jjmarr 2y ago

If you got "needs improvement" on your performance review and missed your target bonus, but the company's stock went up 30% meaning your total compensation still increased, what would you expect? Would you consider that to be a fair punishment? The standard Nadella is setting is that cash bonuses needs to be determined by cybersecurity impact, and that expectation needs to be in every part of the company. So he cut his (non-discretionary) cash bonus by 50%. He could've cut his stock package as well, but you're not going to work at a company where meteoric increases in the stock price can be clawed back if your performance was bad. People would freak out and ask if their stock would be cut if a cybersecurity incident occurred.

glimshe 2y ago
A "needs improvement" is a kiss of death for a normal tech worker. For him, it makes him look humble and deserving of the tens of millions he'll get anyway. Gosh, he might even brag about it.

wenc 2y ago

Yes, why would it not be? It’s still skin in the game. If we think it’s a symbolic gesture, which it may well be, it is still a gesture that most CEOs would not have made. Unlike most here, I don’t think with this he’s saying please punish me for wrongdoing, but more I take responsibility for this failure (which could have happened many levels below him) and will take the loss personally. Sounds like HN folks would love for Nadella to completely reduce his salary compared to last year. I don’t know that I agree. I’d say, let’s see you do it.

diggan 2y ago
> Yes, why would it not be? It’s still skin in the game. [...] and will take the loss personally. Because there isn't any loss overall? His compensation went up 63%, what are these losses you're talking about? If his total compensation actually went down, I'd totally agree with you. But it didn't, which is why I don't understand how this is seen as "great leaders punish themselves".
- jjmarr 2y ago
  He would've had 5 million more dollars this year if he didn't ask the board to change the terms of his contract to give him less money. https://en.wikipedia.org/wiki/Opportunity_cost https://en.wikipedia.org/wiki/Opportunity_cost
  - diggan 2y ago
    Yeah, so he would have gotten $84.1 million instead of what he really got, only $79.1 million. Imagine being a CEO yet so poor.
    - wenc 2y ago
      So if I’m hearing you right, it sounds like you’re looking for net loss to justify the statement that “good CEOs punish themselves”, a statement made by another HNer and not by Nadella himself? He did take a loss but not a net loss, so it didn’t go far enough is what I’m sensing? Thus it’s an empty gesture devoid of any commitments to improve? For me when I see gestures like this, I’m like oh ok. At some level I know it’s symbolic but it still sends a good signal. It doesn’t scream hypocritical to me.