Wednesday, March 18, 2009

AIG experience, more to discredit brain drain theory

From college presidents to corporate executives, one keeps hearing how salaries must be raised to keep the top talent from leaving the organization.

Top talent?

Talented at running things into the ground. Good at being greedy to the level of criminal behavior.

With AIG, one sees another aspect of brain drain theory. Retention bonuses.

When someone screws it up, you pay them more in hopes that they will stick around the company because you fear that they are the only ones who know how to unscrew what they've screwed up.

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