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At first glance, making the CEO pay a baseline seems really self centered. What was the thought behind that? From my eyes looking at: CEO: $100k Me: $33k

At first glance, making the CEO pay a baseline seems really self centered. What was the thought behind that? From my eyes looking at: CEO: $100k Me: $33k makes me think, "well, I'm a junior guy. That will change over time." Me: 1/3 CEO makes me think "why does he think he's worth three of me? It's an emotional distinction, so it could just be me.

MetaCosm 14y ago
... what about 1/231 of a CEO? http://www.epi.org/publication/ceo-pay-231-times-greater-average-worker/ http://www.epi.org/publication/ceo-pay-231-times-greater-ave...
wting 14y ago
This is a form of price anchoring.[0] By representing salaries as a fraction of CEO income, it makes all employees evaluate their worth relative to the CEO. On the other hand, representing the CEO's income as a multiplier of the company's average income is standardized and represents a company-oriented view.[1][2] [0]: https://en.wikipedia.org/wiki/Anchoring https://en.wikipedia.org/wiki/Anchoring [1]: https://en.wikipedia.org/wiki/Executive_pay#United_States https://en.wikipedia.org/wiki/Executive_pay#United_States [2]: http://www.shrm.org/hrdisciplines/compensation/articles/pages/payratios.aspx http://www.shrm.org/hrdisciplines/compensation/articles/page...
18pfsmt 14y ago
I'm not sure how you can call it "self-centered" as neither the founder nor myself were CEO. The reason to use the CEO's salary was because he had the highest salary. If you want to use more realistic numbers, the engineers were paid $90-150k, and the CEO was paid ~$225k. We had about $1.8M revenue, but still not EBITDA profitable. To give even more data, this is Denver in 2006, at an embedded software/ hardware company.