Red Rocket Ventures Blog (Growth Consulting, Small Business Experts)

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I have long thought movie stars and sports activities heroes were drastically overpaid compared to their contributions to society. For instance, instructors are teaching future years of kids, and receives a commission pennies in comparison. And, even well paid doctors conserving lives, are paid a little fraction of what a basketball celebrity gets paid to simply play the overall game of basketball. In the last 10 years, these inequalities are getting to be seen in corporate and business office, as well, with rising CEO pay and a mid-level careers under siege credited to outsourcing and technology automation. I think we have to rethink the traditional pyramid designed organizational framework to “right size” the work completed vs.

Allow me to clarify further. EXACTLY WHAT IS A PYRAMID SHAPED Business? Generally in most hierarchical organizations, it could look something similar to the following. One CEO manages five EVPs who manage 25 SVPs collectively, who manage 125 VPs collectively, who manage 625 directors collectively, who collectively manage 3,125 managers. As you can see, an extremely wide base and a very narrow top leads to a pyramid design as you progress the organization. a year 25MM, which have increased to that level in the last decade or two dramatically.

The first problem with the pyramid design is compensation disparity from the top of the business to underneath of the business. In the example above, do we really think the CEO is worth 32x the managers at the bottom layer of the business? Or, in the full case of a lot of money 500 company, what could be 1,000x the entry level workers?

Probably not, normally times the cultural people in the trenches are doing the hardest work. The second problem is the caps it generates in upward mobility. At every degree of the business, there are 5x as many candidates that may be promoted into the tier above them, as illustrated in our example.

Presumably, the 125 VPs are all equal in conditions of doing a good job roughly, but only 25 of them will have a chance to get promoted to another level. That is such as a 20% potential for winning the lottery in one level to the next. Or, if you go from the bottom level to the top, you have a 32 in 100,000 chance to visit from entry level to CEO. Sorry to the 99,968, you are just out of luck-no lottery ticket for you.

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The third problem is the impact that is wearing the U.S. Firstly, in my own example above, there were six levels of workers, from managers all the way up to CEO. But, instead of having 80% of workers in the bottom tier, imagine if each tier was evenly distributed with 16.7% of the employees in each tier, closer in form to to a cylinder when compared to a pyramid.

But, that creates some interesting management hurdles, along the way. As an example, you can’t have 651 people acting as CEO or managing the business by committee. But, you could empower more folks to make more strategic senior decisions, with fewer levels of bureaucracy. Maybe break the business into pieces, in conditions of how it is handled by section, by region, by customer, by channel or whatever.

This would require much more thought on how best to divide up key decision making roles, to empower more people to take leadership positions. But, if we can choose our Presidents by democratic vote, maybe there is a way to run our businesses the same way? 50,000 a person, which would be like a 33% raise to the 80% of employees in underneath tier, and would materially improve their lifestyles.

Now, I am not saying there shouldn’t be considered a step up on payment with each tier. But, maybe it is a 25% bump instead of a 100% bump in my example, to help with making more room for the people in the low tiers. 94K (up 151%), as good examples, as these were reshuffled upwards within the business. The natural pushback here will be are not enough quality candidates for every tier there.

Most of what Dr Brett Steenbarger advocates for day traders to monitor is dependant on market breadth. He might use different terminology for it however the primary concept is market breadth. My observation is that in small time frames breadth tends to mean revert. If you’re really motivated day trader you can develop market Monitor or various other more creative kind of breadth indicator for day trading and keep it proprietary. Whatever you do in this field you should not discuss publicly as short-term systems are very prone to decay, if they become well known.