Tim Cook, the CEO of Apple just took a 15% pay cut. Now, before you start thinking, “Aw, poor, poor Tim. His salary went down 15% to only $8.7 million. But at least he still has his stock options worth a few hundred million.” Hold on; don’t be happy about Tim’s haircut. There is a lesson here and all should take heed.
Tim took the hit because the company failed to meet its goals for both sales and profits. In a filing Apple said its annual sales were down nearly 4 percent and its operating income was down 0.5 percent from its target.
See the numbers? See the targets and goals? See the performance? See the pay? The lesson is that they are all connected or should be.
It’s still early in the year and by now your goals and objectives for the year should be set. With luck and a good boss, you should have had lots to say about what the goals should be for the year. Even if the goals are a stretch, you should feel some level of confidence that you can achieve the goals and glean the rewards of your performance. If you already think the goals are a wild ass number pulled out of the air and are unrealistic or unachievable, best raise your hand and say so. If your goals are set and are reasonable, figure out how to meet them fast. Get ahead. Annual goals are often met (or not) based on first quarter performance. It’s no fun to play catch up all year.
If you have no goals or objectives for the year I can promise you one thing: YOU WON’T MEET THEM. If you want to connect goals, performance, and pay, you need to have goals. If you don’t have goals for the year yet, drop everything and make a time with the boss to set up a set of goals. The goals need to be written down and shared. Boil them down to magic numbers that you can remember and track against. Use a thermometer type graphic or something simple.
Do it now and you will thank yourself come next December. You can be sure Tim Cook is thinking about hitting targets at Apple.