Largest retailer has world's most underpaid CIO
- 28 August, 2009 05:46
I tend to equate the salaries of celebrity CIOs (an oxymoron, I know) with the compensation packages of today's professional athletes: They're all seemingly excessive and incomprehensible to most salt-of-the-earth people. HP CIO Randy Mott, for instance, took home more than $28 million in compensation in 2008, while New York Yankees' slugger Alex Rodriguez earns $15,856 every time he sees a pitch, according to The Wall Street Journal .
Nonetheless, I bear no ill will toward these exalted millionaires-if somebody is willing to pay you several million dollars each year to hit a baseball or run IT operations, well, more power to you.
So it was with some casual interest that I checked out Retail Info Systems' list of the Top 10 Retail CIO Salaries. (CIO.com compiled two similar lists that are also interesting: Executive Compensation: The 10 Highest-Paid Tech Chiefs of 2008 and Meet the Millionaire CIOs.)
Topping the RIS list this year (based on 2008 compensation) is Best Buy's Bob Willett, with a package that totals $8.6 million-nearly twice as much as his 2007 compensation. (It's important to note that Willett is also CEO of Best Buy International, which partially explains his sky-high earnings.)
Rounding out the top five are: H. Brian Valentine, SVP of E-Commerce Platforms at Amazon.com, $3.9 million; Thomas Nealan, EVP and CIO of JC Penney, $2.1 million; William Giles, CFO and EVP of Finance, IT and Store Development at AutoZone, $1.8 million; and Lisa Bachmann, SVP Merchandise Planning and Allocation and CIO of Big Lots, $1.6 million.
One name, much farther down the list, that floored me was Wal-Mart CIO Rollin Ford, at number 9. Wal-Mart's Mystery Man of IT-he rarely makes public appearances or speaks to media outlets-was compensated a meager $646,154 by the world's largest retailer (with annual revenues of $401 billion, for what that's worth).
If I'm Rollin Ford, and I see this list, I'm hitting the flippin' roof. The CIO of Guess (Michael Relich at $874,687) is making $200,000 more than me. Guess? What is this? 1989? I didn't even know Guess was still in business. (Apparently high salaries are de rigueur at Guess: CEO Paul Marciano's total 2008 compensation was $15.2 million, even as Guess's share price tanked by almost 60 percent during last year, according to The Street.com.)
Now, I know these executive compensation lists can be tricky business. Research for the RIS list is "based on public proxy statements filed with the Securities and Exchange Commission (SEC)," notes the RIS report. "The SEC mandates that public companies file a report on what their top five highest paid executives earn in terms of salary, bonuses and incentives."
More than likely, Wal-Mart compensated Ford more than $646,154 last year-he just didn't take home more than five other Wal-Mart executives above him on the food chain and therefore wasn't on Wal-Mart's SEC filing. (RIS retrieved Ford's figure from Hoover's, says Joe Skorupa, group editor-in-chief, via e-mail.)
Still, Ford appears to be woefully underpaid, considering his accomplishments over the past three years. Despite stumbling with its IT strategy before Ford took over in 2006, Wal-Mart IT, under Ford, has set aside its imprudent aversion to packaged retail software, is dabbling in strategic outsourcing where it makes sense, and is using IT and supply chain applications to achieve its lofty sustainability agenda.
Granted, just how much Ford and his ISD group are responsible for Wal-Mart's success during the past three or so years is debatable. But one can't argue with success.
What one can argue with, however, is a low salary, especially if you're the CIO of a $400 billion company that pretty much rules the world.
For a final comparison, I'll leave you with this: Based on that Wall Street Journal research, which tracked how long it takes professional athletes to make $100,000, it takes the Yankees' Rodriguez a mere 39 pitches to equal Rollin Ford's 2008 compensation.