(FORTUNE Magazine) – MANAGING/COVER STORY 44 BURNED-OUT BOSSES Talk about conflicting messages! Managers in the Nineties are supposed to think of themselves and their employees as a team, yet at the same time they are often charged with firing wave after wave of people. The experience turns some formerly strong executives into wrecks. And while companies direct their resources for dealing with the trauma of downsizing to the most obvious victimsthose let goover the long term the survivors may suffer more psychological damage than the departed. by Lee Smith

THE ECONOMY 56 NEW THREATS TO THE EXPANSION Though business is still strong, economic growth is jeopardized by jumpy financial markets and worsening inflation pressures. by Vivian Brownstein |

66 THE OUTLOOK FOR U.S. INDUSTRIES The price war in computers is over, but it rages on in pharmaceuticals. Most industries are enjoying high operating rates and strong earnings prospects.

SELLING 80 THE DEATH AND REBIRTH OF THE SALESMAN Companies are remaking their sales forces to satisfy today's exacting customers. But total quality goals and sales quotas still clash. by Jaclyn Fierman

COMPENSATION 94 A KNOCKOUT YEAR FOR CEO PAY As profits surged with the American economy in 1993, boards of directors opened the corporate wallet for CEOsespecially those who switched companies. by Brian Dumaine

MONEY & MARKETS 106 LEARNING TO LIVE WITH DERIVATIVES They're here, they're weird, and they're not going away. These beasties bite, but companies that tame them have a competitive edge.

by Terence P. Pare

THE GLOBAL ECONOMY 118 THE WORLD ECONOMY IN CHARTS FORTUNE's annual survey shows new life in the global economy as America's momentum spreads to the rest of the developed world. by Tom Martin

DEPARTMENTS 6 EDITOR'S DESK 10 INDEX 16 NEWS/TRENDS Old CEOs who never can say goodbye, getting back your European VAT, a racy Rolls-Royce, "daddy stress" gets a voice, a bang for your buck in Boulder, the wireless megalopolis, and more.

29 PERSONAL INVESTING In today's volatile market, many of America's blue-chip stocks are now bargains. by Susan E. Kuhn

Also: Where to stash cash, how to profit from privatizations, a different kind of healthy deal, and Portfolio Talk with John Ballen of MFS Emerging Growth fund.

41 LETTERS TO FORTUNE

233 COMPANIES TO WATCH Regional airline Skywest is making a profit on short hops between small cities. by John Labate

235 PRODUCTS TO WATCH McGunn's steel safe with some of the capabilities of an ATM, Sharp Electronics projection panel (designed to make laptop demonstrations seem as pass as slide shows), and Post-it Easel Padsfor the extremely nearsighted. by Wilton Woods

237 THE WIRED EXECUTIVE A radio company exec deep-sixes his paper organizer in favor of the memory and processing power of a personal digital assistant. by Alison L. Sprout

239 BOOKS & IDEAS Of a bumper crop of tomes on leading, four deserve a read. Plus, greed down on the stud farm and fractured facts.

243 KEEPING UP Good news for this department, even better news for Yalies, bad news for 13th Street, and other matters. by Daniel Seligman

246 ENTREPRENEURS Charlie Leighton's CML Group has profited handsomely from turning trends into retailing friends. by Andrew E. Serwer

138 MORE PROFITS, LOWER SALES Profits rose 10% overall last year, allowing for accounting changes, while sales dropped 1.3%.

143 THE 500 RANKED BY SALES The world's largest industrial corporations.

159 THE 500 RANKED BY PERFORMANCE Who did best as the economy began to recover? Here are the top 50 by various measures.

164 THE 500 RANKED WITHIN INDUSTRIES How each company stacks up against the competition in 25 industries.

184 THE 500 LISTED WITHIN COUNTRIES The U.S. still contributes the most companies, but Japan is gaining on it, followed by Britain.

195 INDEX

ABOVE: What makes the flood of dismissals in recent years especially + distressing for managers is that so often workers have been fired not for cause but because their skills were no longer needed. Photo by Max Aguilera- Hellweg.

COVER: Photo by Chris Callis.

FORTUNE (ISSN 0015-8259). Published biweekly, with three issues in October, by Time Inc. Principal office: Time & Life Building, Rockefeller Center, New York, NY 10020-1393. Reginald K. Brack Jr., Chairman; Don Logan, President; Joseph A. Ripp, Treasurer; Harry M. Johnston, Secretary. Subscriptions: U.S., possessions: one year (27 issues) $52.95; Canada: one year (27 issues) $53.73. Second-class postage paid at New York, NY, and at additional mailing offices. Authorized as second-class mail by the Post Office Dept., Ottawa, Canada, and for payment of postage in cash. Member, Audit Bureau of Circulations. POSTMASTER: Send address changes to FORTUNE, P.O. Box 30604, Tampa, Fla. 33630-0604. Customer inquiries: FORTUNE, P.O. Box 60001, Tampa, Fla. 33660-0001. Phone: 1-800-621-8000. ) (c) 1993. Time Inc. All rights reserved. FORTUNE is a registered mark of Time Inc. For subscription queries, call Customer Service at 1-800-621-8000. Time Inc. GST R122781974.