Thursday, September 05, 2013

Slate: Tales of an Ex–Microsoft Manager

This Slate article describes a Microsoft practice called "stack ranking" where the actual competence of employees is irrelevant to their compensation, instead dishing out awards and punishments based solely on how they compare against their coworkers.

The result is that instead of A-players wanting to be teamed with other A-players (as Steve Jobs described the natural state of a development organization), you end up with A-players wanting to be teamed with B-players, in order to ensure that their achievements will result in rewards and not punishments. The result is lousy products, engineers that don't care, and managers that are required to make the problem worse.

Why do I get the sinking feeling that most corporations do this, or something equally brain-dead?


JamesQMurphy said...

Procter & Gamble did it, at least they did in the early '90s.
Merrill Lynch did it.

Like the author pointed out, it is a zero-sum game. The employees sole motivating factor becomes, "Who do I have to kill to get promoted?"

Shamino said...

The system can (sort of) work in an environment where there's a lot of employee churn (so there are always some number of incompetent people) and where everybody's job is interchangeable (so you can actually compare people on a linear scale.)

It is completely brain dead in a creative organization, where everybody is doing a qualitatively different job, and is completely self-destructive if you don't have a constant influx of new employees - because you end up systematically destroying the good people who survived prior rounds of culling.

But what can you expect when corporations are run by people who have never done any real work, and whose college education is in "management"?