Cost Saving by Cutting the CEO's Salary : A Case Study of Narmada Techno Crafts Ltd

Abstract

Narmada Techno Crafts Ltd. is a company in Pithampur (M.P., India) which produces machines, which are exported. The company was suffering because of the lockdown caused due to the COVID-19 pandemic. During the lockdown, the factory was closed and the production was also shut down ; hence, the company was unable to complete the export orders. The board of directors was seriously thinking about the same issue. The way of thinking was towards cost cutting. One of the directors had an objection on the high salary of the Chief Executive Officer of the company. He advised a cut down in the CEO's salary package. The Managing Director, Mr. Shantanu Kapadia was not in favour of the same. As per his opinion, the CEO, Mr. Murlidhar Agarwal was an asset for the company who contributed towards a lion’s share in the progress of the company. He presented a four pillared plan to save costs in the future after lockdown as well as tried to prove that the salary of the CEO was not excessive.