Jeff Nash of Financial Week writes, "According to a new study, companies pay their chief executives nearly three times more when they hire them from outside the company than if they promote from within."
Nash continues, "In the first year of employment, CEOs snagged from the outside earned median pay of $13 million in 2005, compared with $5 million for those appointed from the inside." "Just 15% of the directors said their boards were "highly effective" in managing and developing their executive talent."
A New Boss From Outside Costs More ... a Lot More. [Financial Week - Jeff Nash]
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1 comment:
Bill, we've often found it isn't the cost that is the major detracting factor, it's the lack of knowledge of the company culture. Some CEOs learn fast, some don't.
IF they don't the cost becomes huge.
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