Comment by rs186

CEO pay has grown wildly in recent decades: https://en.wikipedia.org/wiki/Executive_compensation_in_the_...

Does mean that CEOs are wildly more effective? Or just wildly better at diverting profit to themselves? I'd argue the latter.

Further, CEOs and wannabes have a strong incentive to structure organizations such that they depend ever more on the CEO, justifying massive compensation and of course feeding their egos. But I would argue that beyond a certain size, having to route everything important through one guy is an organizational antipattern. So yes, I'm very willing to argue most CEOs shouldn't exist. Or at least most CEO positions.

> I keep seeing this line as if people think CEOs shouldn't exist or aren't worth their compensation. That is incredibly incorrect thinking. Good CEOs and bad CEOs are two different creatures and lead companies to very different places.

If the “bad” CEOs don’t take pay cuts or subsequently struggle to find work, then that thinking is obviously not as “incredibly” incorrect as you claim.

> I keep seeing this line as if people think CEOs shouldn't exist or aren't worth their compensation.

Yes. This is absolutely true. Most CEO’s are not worth this kind of money. In fact, most CEO’s could disappear overnight and cause zero disruption to the operation of the company.

I think the complexity of the job is _far_ overrated, and the main reason people think they’d suck at it is because they have no/less confidence.

People that become CEO’s are purely better at faking that confidence. If you are lucky, the confidence is built on skill instead of bluster, but they both get paid the same regardless.

CEO should exist, and it's normal that their compensation is the highest of the company.

However it shouldn't be a 268 to 1 ratio with the median worker like the SP500 average. There is no way the CEO is worth that much money to the company.

> I keep seeing this line as if people think CEOs shouldn't exist or aren't worth their compensation.

Yes indeed. There is no CEO in existence worth 30 of the employees that work under them. It's certainly true that good and bad CEOs exist, and that a good CEO can be a force multiplier that deserves higher compensation. But 30x (and often more!!) is an insane overinflated view of CEOs' worth to the company. The only reason they get away with it is that they are hired by the board of directors, which is.. other CEOs. So a good old boys' club is keeping salaries high completely divorced from any actual value provided.

Everyone's acting like a competent CEO is some kind of rocket scientist unicorn.

In reality they don't do all that much. And most of the decisions are driven by data and advice from Gartner that just recommend the highest bidder, not some magical insights.

After all the CEO works for the board which is made up of shareholder representatives. They have very little industry knowledge and they just want the company to jump on the latest hype and "industry practices". They're usually very risk-averse.

So the CEO is kinda tied by what's happening in the industry anyway. The only CEOs that are capable of breaking that are the ultra confident ones like Jobs or Musk.

> I am sure I will be the most terrible CEO

If you just do nothing, you'll be better than the last 10 years of Mozilla's CEOs.

Well just look at that one CEO instead of doing the same mistake you accuse others of.

In theory, every one of the CEO's reports (other than their administrative staff) is capable of stepping into the CEO's job. If they aren't capable (albeit some with coaching and support) that calls into question the company's overall hiring and promotion practices.

In that case, for every CEO there's literally a dozen other people at that company alone who could do their job. Why do we keep repeating that good CEOs are in short supply?

Moreover study after study has shown little correlation between CEO pay and quality of decision-making. Case in point: https://en.wikipedia.org/wiki/Marissa_Mayer#Yahoo!_(2012%E2%...

And finally, rich people eventually look for other ways to feel valued. Status is a big one. Having the top job at the company is a big perk in and of itself. If they don't feel privileged to be the CEO, why the hell even take the job?

I have seen CEOs that where earning 250k in the EU with thousands of employees. The issue is an entitlement issue, where today's world makes people think that they deserve millions of dollars for leading a company, same issue as developers expectings hundreds of thousands for their work. Its a corruption of the system which is both a effect and a cause of the current death of capitalism in the US.

How did your CEO become CEO? Mine got there because he was golfing buddies with another CEO that was golfing buddies with another CEO that was golfing buddies with the company that ultimately bought out my old CEO.

How does that make them "worth it"?

> but I am sure I will be the most terrible CEO in the history of the company

Look, I've interacted with CEOs and frankly the job isn't nearly as hard as you are making it out to be. The most important aspect of the job is socializing, not managing the company like you might assume. It's putting on a good show and making potential clients like you. It's every bit just being a good salesperson.

There's a reason, for example, my CEO currently lives in California even though his company is halfway across the country and has no offices in CA.

Now, that isn't to say the Job of a founder CEO isn't a lot more difficult, it is. However, once a company is established the CEO job is a cakewalk. There's a reason companies like FedEx had a CEO literally in his 80s that gave up the reigns right before he died.

If you have the ability to schmooze, sit through meetings, and read power-points. Congratulations, you have what it takes to be a CEO.