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Interesting. So, when is it that bonuses to employees maximizes the value to shareholders?
When they are tied to productivity. If you produce 100 widgets in a week, I will give you an extra $100. Or If the stock price hits $45, Mr. CEO you will get $1 million.
When they are tied to productivity. If you produce 100 widgets in a week, I will give you an extra $100. Or If the stock price hits $45, Mr. CEO you will get $1 million.
How do you figure that out before making an argument like you just did, and the one before it?
Do bonuses always cost to the shareholders? What criteria do you use to arrive at the conclusion?
How do you figure that out before making an argument like you just did, and the one before it?
Do bonuses always cost to the shareholders? What criteria do you use to arrive at the conclusion?
Well as I pointed out, bonuses tied to productivity do increase shareholde value through increased productivity. The bonuses awarded to the GM workers were for nothing.
Well as I pointed out, bonuses tied to productivity do increase shareholde value through increased productivity. The bonuses awarded to the GM workers were for nothing.
Well as I pointed out, bonuses tied to productivity do increase shareholde value through increased productivity. The bonuses awarded to the GM workers were for nothing.
It was profit sharing. Your contention is that the workers have no impact on profit?
Well as I pointed out, bonuses tied to productivity do increase shareholde value through increased productivity. The bonuses awarded to the GM workers were for nothing.
But then you say:
Quote:
Originally Posted by shorebaby
OK, even worse. The share holders should come first.
Of course workers have impact on profit, that is why they get wages.
So, bonuses based on productivity are OK, because increased productivity positively impacts share value, right?
You don't believe profit has a positive impact on share values? If you *do*, then why would profit sharing bonuses not be OK, as well?
So, bonuses based on productivity are OK, because increased productivity positively impacts share value, right?
You don't believe profit has a positive impact on share values? If you *do*, then why would profit sharing bonuses not be OK, as well?
Let me help you out. Did the bonus provided to the GM workers encourage increased productivity? Was any increased profit realized as a result of the bounus? No and no. Giving workers a bonus for doing the expected is not a good use of resources. Let me give you an example. When your mechanic presents a bill for work done, do you then give him extra? Why of course not, he hasn't done anything extra to earn that money. Get it?
If you said to GM workers you will get a bonus for producing "x" number of cars, that provides benefit to the share holders. That is productivity above and beyond the expected.
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