Page 183 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

Chapter 5. Salary 169

1. Working with the board of directors establishes the vision, mission and of objectives the
organization.
2. Having assessed the threats and opportunities facing the organization and based on its core
competencies, establishes the goals and objectives to meet the company’s approved vision and
mission.
3. Determines what organizational changes (e.g., IPOs, mergers, acquisitions, alliances and joint
ventures) are needed to meet the vision and mission, seeking approval by the board of directors.
4. Reviews financial needs to meet the goals and objectives submitting to the board of directors for
approval.
5. Approves operational plans that support the approved goals and strategies.
6. Approves policies and programs that reinforce attracting, retaining and motivating talented people
with the desired values.
7. Manages the organization to achieve the goals and strategies keeping the board of directors
informed of progress.
8. Communicates with stakeholders of the company on matters affecting them.
9. Reviews with the board of directors a succession plan for self and other key executives and then
implements development steps consistent with the approved plans.
10. Conducts self in a manner consistent with what is expected of others in the organization and by
the stakeholders.
Table 5-2. Position description of a chief executive officer

corporate vice president, human resources). The first may be a divisional position; the latter
most likely is a corporate officer. Be careful not to get caught up in title inflation where
it seems almost everyone is a vice president. Guidelines must be in place. For example, divi-
sional vice presidents may report to corporate vice presidents (who are officers of the com-
pany). However, neither divisional nor corporate vice presidents should report to someone
with the same VP identification unless that person has a modifier such as senior or executive
or group.
It is important that jobs be carefully and accurately described because these descriptions
from the basis for the subsequent evaluation of the job’s relative worth. Rater bias coupled
with organizational politics will otherwise distort valid comparisons.
Few organizations undertake job analysis at all levels of the organization. Typically, it
includes those below group or division president level; few position descriptions exist for
company chief executive officers. If the CEO does not believe a job description is necessary,
the board of directors may think otherwise. The rationale for sidestepping job analysis is that
it is not necessary above a certain organizational level. After all, we all know what a compa-
ny CEO does, don’t we? Interestingly, these same people may question the compatibility of
survey data when only a job title is used.

JOB EVALUATION

The objective of job evaluation is to array jobs described in the job analysis phase in a man-
ner that will best reflect their value to the organization and their relationship to similar jobs
in other companies.