If he gets more than 500’000 in my example, he could not care less and would keep doing it for obvious reasons. The point is that a fix % does not work, you need to actually do the math and see at which point it is a relevant net loss to the CEO (or whoever).
You don’t get it. How long do you think these charges would last if he was on the receiving end? I bet these would be gone in a month.
If he gets more than 500’000 in my example, he could not care less and would keep doing it for obvious reasons. The point is that a fix % does not work, you need to actually do the math and see at which point it is a relevant net loss to the CEO (or whoever).