What is the value of a given executive to your company? What should you be paying them for their contributions? What is that open position really costing you as the hours tick by?
One highly accepted model is that the individual should produce 5 times their rate of pay. This is a helpful guide when determining reasonable expectations.

- VTC: Value to Company (Hotel / Resort or Corporate position)
- LPM: Loss per Month
- LPW: Loss per Week
- LPD: Loss per Day
Here is the explanation of the ‘formula’ above. Suppose you have a position for which you pay $60K per year. According to the model, multiply by 5 to determine the value to your company $300,000 (60K/year x 5 = VTC ). Now, look at this position as if it were open.
Each Month that goes by costs your company $25,000 (VTC / 12 = LPM) What does it cost per week?
This opening or non-productive position costs your company $5,769.23 per week. (VTC / 52 = LPW) Cost Per Day? $1,153.84 (VTC / 52 / 5 = LPD)
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