Outperform

Every executive believes they are paid for performance. The data say they are paid to stay.

Across three countries and multiple years, the link between executive pay and company performance all but disappears when performance is measured in absolute terms. In Outperform, Dr. Hermann J. Stern — founder of the Swiss performance-measurement firm Obermatt — shows why budget targets fail, why they reward cost-cutting over growth, and how boards end up paying executives for the weather rather than for the game.

The answer is indexed pay for performance: measure managers against their true competitive peers, not against internal budgets. Using the Rank Method rather than opaque alpha calculations, Stern turns a percentile any athlete understands into a defensible, transparent link between reward and genuine outperformance — one that protects executives in bad years, pays them in good ones, and survives the scrutiny of shareholders, journalists, and proxy advisors alike.

Drawing on real engagements at Daimler, Sika, Plansee, Zumtobel and others, and on the seven Performance Indexing Tools built over twenty-five years of practice, Outperform is a practical, evidence-based guide for anyone who sets executive pay — and wants a system that actually rewards the performance they intend to reward.