When longtime Target Corp. (NYSE: TGT) CEO Bob Ulrich retires soon, he'll leave behind a very impressive legacy. Target, the second-largest discount retailer in the U.S., has grown alongside its larger competitor Wal-Mart Stores, Inc. (NYSE: WMT). While Wal-Mart was opening stores and increasing sales at a blistering pace, Target was no slouch. Even though Wal-Mart grew much faster, Target's strategy worked pretty darn effectively, too.

Target seemed to beat Wal-Mart to the punch on the trends many customers cared about: brand-name clothing, hip marketing, clean and bright stores and very effective marketing and merchandising of its own store-brand product lines. While Wal-Mart became the generic big-box store, Target seemed to be the store shoppers flocked to to stay away from Wal-Mart's lifeless marketing, boring stores and grand-central-station customer traffic. In other words, price isn't everything to every U.S. retailer customer.

Now that Ulrich is retiring, his longtime company sidekick Gregg Steinhafel will be taking over with some lingering challenges that will put him on the hot seat almost immediately. Target is suffering, along with other retailers, from a seemingly-persistent economic slump and from the performance of its credit-card business (which is being hit with defaults due to consumer credit problems nationwide). Although things can be rosy at Target, they aren't for all of its customers at this time. With rising energy prices and the spike in food staple prices recently, Target's store brands like Archer Farms may suffer or need to be priced at the level of brand names -- and then they may lose their appeal to consumers looking for quality alternatives to higher-priced brand names. Steinhafel will have his plate full as he takes over when Ulrich turns 65 --Target's mandated retirement age for the CEO position.

When the going gets tough, the CEO gets dropped. At least, that's what happened at retailing giant Target Corp. (NYSE: TGT) in 2007. Company CEO Bob Ulrich saw his salary and bonuses reduced by 42% last year as the discount retailer failed to meet sales expectations and saw its stock price decline.

Like many CEOs, Ulrich's compensation is tied to its stock price and to the company's financial performance. Although he received $1.66 million in pay and non-stock compensation of $2.89 million (down from $6.13 million), Ulrich's total compensation dropped 67% in 2007 to $12.2 million.

Sounds like quite a bit to many of us, yes? Target explained that some of Ulrich's stock awards for the year were actually made in previous years and expensed in 2007, which makes up for some of the amount. Target officials were pretty clear about saying, "Our financial results in 2007 fell well short of our goals . . . as a result, non-equity incentive payouts for executive officers were near the low end of the payout range, and long-term performance share award payouts were negatively impacted."

Still, more than $12 million is not a bad payday.