Untangling Skill and Luck
Harvard Business Review
FEBRUARY 7, 2011
Take, for instance, a group of companies that currently have high returns on invested capital (ROIC). If you follow that group over time, you would see their ROICs revert back toward the cost of capital. Ideally, a compensation program pays an individual for his or her skillful contribution toward achieving a desirable objective.
Let's personalize your content