Measuring CEO/Management Performance


The table below provides input data which we will use to compute ratios a), b), c), d) and e). These ratios were
previously defined at (link). Theses ratios then, in turn , will be used as inputs in a Net CEO/Management
Performance Algorithm. See the second Table below. This will be a preliminary algorithm. A more refined formula,
for CEO performance, (using more elaborate input data) will be presented later. The monetary figures below are in
$'s.


                                                     Number of                CEO Com-         Gross           % Shares             Short %of
Symbol    Name/CEO                 Employees                pensation           Profits          Insiders                 Float
                            
GE          J. Immelt                         316000                    3230000                   82.89B        0.06                     0.3
HD         R. Nardelli                       234600                    9160000                   27.32B        1.1                       1.6
INTC     P. Otellini                           99900                    3290000                   23.05B        3.26                     1.2
HON      D. Cote                            116000                    4500000                     6.19B        0.13                     0.8
WMT     H. Scott                         1800000                     5230000                   75.26B      41.21                     0.8
XOM     R.Tillerson                      106100                     2420000                 157.68B       0 .17                     0.9

The ratios below are based upon the data above and are defined at the link indicated above.


Symbol              Name/CEO              Ratio a       Ratio b           Ratio c            Ratio d          Ratio e       
               
GE                      J. Immelt                    10.22    25662.54          262310.13        0.08            0.2
HD                     R. Nardelli                  39.05      2982.53          116453.54        0.01            0.69
INTC                 P. Otellini                    32.93      7006.08          230730.73        0.07            2.72
HON                  D. Cote                      38.79      1375.56            53362.00          0.01            0.16
WMT                H. Scott                         2.91    14390.06            41811.00         0.01           51.51
XOM                 R. Tillerson                  22.81    65157.02        1486145.15       0.61             0.19



Symbol    Name/CEO          Net/CEO Rating      
                                            
GE          J. Immelt                     71.82         
HD         R. Nardelli                   21.23   
INTC     P. Otellini                     50.30
HON      D. Cote                          8.17                     
WMT     H. Scott                    1 17.72
XOM     R.Tillerson                330.75


The average rating will be seen to be 100.  The lion's share of the weighting (among the ratios) went to
ratio c), the Gross Profit per employee. A casual glance will  show the wide variation  in ratio c), among
the different companies, in the table above. One is therefore not too surprised at the relatively wide variations
in the net ratings for the listed CEO's.

A more detailed discussion, plus a similar treatment for all 30 of the Dow components,  will soon follow.


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