Report: CMOs Are 'Underpaid' and 'Undervalued'

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impactnow
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Value in what you produce
impactnow   3/31/2012 4:22:14 PM
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I think that you are worth your pay if you can bring measurable results to your organization, if you are not in any functional area you are overpaid. Unfortunately the role of CMO is the kiss of death for some careers because the average tenure is only 18 months hardly long enough to make an impact and measure it.

Barbara Krafte
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Re: CMO Pay
Barbara Krafte   3/31/2012 12:38:52 PM
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All I can say is good for 1-10. If they negotiate on behalf of their respective companies half as well as they do themselves, they're worth every penny.  The operative word of course is "if."

John Barnes
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Re: CEO'S VIEW OF CMO'S VALUE
John Barnes   3/31/2012 9:53:39 AM
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In general, in most human collaborative endeavors, there are two kinds of activity:

1) the one that it is obviously all about, the activity to which the organization would be dedicated if people knew what they were doing, which is chronically underpaid and performed by the speaker,

2) peripheral and support activities, which the organization should get from the best really cheap source and control costs on aggressively, which are chronically overpaid and performed by everyone else.

Susan Fourtané
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Re: Performance based pay
Susan Fourtané   3/31/2012 5:27:32 AM
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WaqasAltaf

Oh, you are right there! It would be really interesting to actually have the results of such a survey. 

-Susan

Susan Fourtané
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Re: Ha! Really?!
Susan Fourtané   3/31/2012 5:09:59 AM
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Mitch, 

I don't believe 1 and 2 are always true. It very much depends on the company's philosophy, the company's size, and even the country where the company operates.

" The research scientist who develops the revolutionary vaccine is likely to generate vast sums of wealth for his employers as the vaccine is sold around the world."

It's not all about money, even if it seems to be. Call me a romantic but it's also about being human and recognizing that if those researchers, who discover and devolep the vaccines that save lives, one day decide to stop working unless they get paid more and get the recognition they deserve many people around the world would start dying. How much does saving a human life cost?  What is its ROI? Of course there is a lot of a moral dilemma here. 

"But unfortunately for her, research scientists are perceived as not being worth paying."  Yeah, they don't look cool enough in their white coats. 

"On cynical days, I sometimes say that if you want to make a lot of money, you shouldn't get a job that involves making anything or performing a useful service. The people who make a lot of money don't do anything useful at all; they just move money around from one place to another. However, I am not having a cynical day today so I won't say that."

Well, at least I agree with you on that. As I am having a cynical day today I can say it for you. 

-Susan 

WaqasAltaf
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Re: Performance based pay
WaqasAltaf   3/31/2012 5:00:16 AM
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@ Susan

Then all I can say is that humans are greedy. If you take a survey of each and every employee around (I know this cant be practical) in the world, I can bet that 99% of them would complain that they are underpaid, whether thats a fact or not.

Susan Fourtané
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Re: Performance based pay
Susan Fourtané   3/31/2012 4:12:14 AM
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WaqasAltaf 

No, you can't compare ants and lions, can you? 

Again I am going to repeat this: the problem I see is that they are complaining about being underpaid when they are not. They are well paid. If they want even more that is another story.

In any case, a CMO can't be paid equally or more than a CEO who has the whole company on his/her shoulders. 

-Susan  

 

John Barnes
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Economics, both free-market and various kinds of limited-market,  has a number of theories for explaining the fraction of value that workers are paid; for example the more unusual your talent is, the greater the fraction of the revenue you generate you will capture (this is why pro athletes and musicians are paid so much; there are no substitutes for them in filling the stadium, so they can gain a bigger share by threatening to walk, whereas no matter how much Fred the Janitor enhances the building, he can be replaced fairly easily). 

One problem that has never had a satisfactory resolution is wages-versus-profits as a fraction; the game theory, market stability, etc. theories ultimately can't seem to say why corporations pay out the percentages they do in wages (which includes anything else you give the worker, including most of benefits, some working conditions, etc) versus profits (similarly, not just accounting profits but all the stuff the owners get).  At one time American industry was notoriously low-profit and high-wage; now it's the other way round; that seems to be purely a matter of applied political power over time.

Maybe if we stopped looking at the benefits the CMO and CEO give to the enterprise and just considered how much power they have, we'd see there's no mystery here at all.

kicheko
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Re: Ha! Really?!
kicheko   3/30/2012 6:30:03 AM
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On top of that, it depends on the general pay scales of the specific industry. For instance, today people working in the broadcast media earn tremendously large sums of money. For what seems to the common citizen like me, a regular job of just reading a script infront of a camera.

Take another job like say being a University professor, which is similar but different in the sense that it involves a lot more research on the lecturer's part, the pay is almost measly. Overall it boils down to being in the right industry and then right job. Quit CMO and go for CEO.....assuming its that simple.

infinity
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Re: Ha! Really?!
infinity   3/29/2012 4:38:01 PM
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@mitch, I don't think it's always true about points 1 and 2 about how pay is determined but 3 certainly comes into play always. I have held many jobs where I did the work of multiple people, with tons of unpaid overtime since we weren't dealing with hourly situations, and pay-wise, certainly didn't receive pay commensurate with what I was doing. Meanwhile there were others who were in the spotlight working far fewer hours receiving many times my pay.

Underpayment also happens a lot when companies decide to be lean and mean -- they cut staff, leaving current employees to do extra work without bumping the pay up to go along with the workload. Meanwhile, the CEOs more often than not still receive pay raises.

As a whole, payscales are widely skewed from the CEO down to the average worker within the same company. Some CEOs earn 40 to 400x the hourly rate of the average mid- to high-level worker at the same company, while the CEO isn't bringing in that much revenue or value and may even be running the company into the ground.

I don't recall the site, but a while back there were charts showing the average CEO pay compared to worker pay from the 50s until now. In the 50s they earned 2-4x the average worker, which seems fair. Nowadays, anyone who is not the CEO, from the CMOs on down, would probably want to throw up if they saw how much their CEOs made compared to their own salaries.

 

 

 

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