Doug DavidoffIf you haven’t heard, Ford Motor Company paid their CEO, Alan Mulally, $28 million dollars in 2006. This included an $18.5 million bonus. Ford lost $12.7 billion in 2006. (Click here to read the article). While normally I am not one to spend a lot of time worrying about what companies pay their CEOs, this news item is simply too outrageous to allow it to pass without comment.
It’s more obvious than ever that Ford and many other large companies are completely out of touch with their customers. When the leaders of a company can get paid that type of money while customers continue to leave in droves, accountability disappears. I own a business and have worked with hundreds of other private business owners. When our companies lose money, we lose money. We understand that it is the customer who controls our future, because we are rewarded when they reward us and we are penalized when they don’t.
What does this have to do with your company or fast growth? If the reward system in your company is not completely aligned with your customers' interests, then sustained growth is precarious at best. This is why I like private companies better than public ones (and why most of my investments are in private business) – because the only determinate of success is their customers, not some perception on Wall Street.
Take a look at your company. Are your people rewarded or penalized based on how your customers feel? If they are, then fast growth is achievable. If they’re not, what’s the difference between you and Ford?