Letter From Prison Answers

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1. My entire career was spent at Computer Associates and while I can’t tell you first-hand about the pressures in other companies or industries I believe that CA was among the most aggressive in its pursuit of goals, a fact often relayed to me by my industry peers. Both the CEO and I exerted significant pressure on our teams to meet the goals that we had set for ourselves. As you would expect this has a trickle-down effect to others in the organization. While from this perspective performance was measured by internal goals at an executive level these targets were primarily driven by the expectations set by outside parties, primarily the analyst community. While institutional investors were very important their buy, sell, hold decisions …show more content…

The challenge is always in balancing the complexity of a compensation plan with the desired behavior. We spent a significant amount of time aligning the compensation of employees to the corporate goals.

7. Option compensation will continue to be a critical component of compensation for executives as it simplistically aligns the executives’ pay to shareholder value in its simplest sense. I don’t believe that options compensation is the primary driver of behavior when things shift from the legal to the illegal. As with most senior executives in industry, ego is a huge driver in individual behavior. Compensation is important, but the recognition of your performance is sometimes even more important. We have created a performance driven culture without the necessary control framework for people to operate within. One minute you are doing a great job, the next you have crossed an imaginary line. The frameworks don’t do enough to quantify behavior as legal and illegal leaving inconsistent rules for organizations to operate within. How does Enron compare to the subprime mortgage debacle, or to Steve Jobs backdating options. There remains too much room for interpretation.

8. Probably covered in the above. Some other forces would include employee wellbeing, customer satisfaction, short vs long term objectives, competitive position.

9. This is the million dollar question. In my instance I will be deported, probably to Australia, upon my release. The market there is smaller so

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