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This is a logical consequence of this style of management, at least if you accept four general assumptions: | This is a logical consequence of this style of management, at least if you accept four general assumptions: | ||
''Good staff leave by themselves'': Staff with [[Lateral quitter|the gumption to leave]] tend to be | ''Good staff leave by themselves'': Staff with [[Lateral quitter|the gumption to leave]] tend to be good employees, ''relative to what you pay them''. These people are, therefore, ''necessarily'' underpaid. No surprise: that’s why they’re leaving. | ||
''Bad staff don’t'': Conversely, those who are already overpaid for what they do tend not to quit, because they know are already onto a good thing. These staff ''may'' leave, but only to join an employer even more gullible that you. Otherwise, they won’t leave ''unless you make them'', by performance management or through a [[RIF]]. These people, therefore, are generally ''overpaid''. That’s why they stay. | ''Bad staff don’t'': Conversely, those who are already overpaid for what they do tend not to quit, because they know are already onto a good thing. These staff ''may'' leave, but only to join an employer even more gullible that you. Otherwise, they won’t leave ''unless you make them'', by performance management or through a [[RIF]]. These people, therefore, are generally ''overpaid''. That’s why they stay. | ||
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===System effects=== | ===System effects=== | ||
Here is [[systemantics]] in its natural state. How incoming [[Lateral hire|lateral hires]] perform will remain to be seen but, remember, performance is measured relative to cost. One firm’s incoming lateral hire is another firm’s lateral quitter. An outperforming [[lateral quitter]] marks herself to market, gets a pay-rise (why else leave?) and enters her new firm at the [[cost-value threshold]]. When she pitches up, she is no longer an outperformer. True, she may turn out that way, but it is not certain. She is just as likely — presuming a normal distribution again — to | Here is [[systemantics]] in its natural state. How incoming [[Lateral hire|lateral hires]] perform will remain to be seen but, remember, performance is measured relative to cost. One firm’s incoming lateral hire is another firm’s lateral quitter. An outperforming [[lateral quitter]] marks herself to market, gets a pay-rise (why else leave?) and enters her new firm at the [[cost-value threshold]]. When she pitches up, she is no longer an outperformer. True, she may turn out that way, but it is not certain. She is just as likely — presuming a normal distribution again — to underperform. | ||
Secondly, notice how pernicious the idea of the ''average'' is here. | Secondly, notice how pernicious the idea of the ''average'' is here. | ||
===Affirmative action bummer=== | ===Affirmative action bummer=== | ||
If so, then a system | If so, then a system that, to correct a perceived imbalance between groups, favours one (Group A) over another (Group B), will have a counterintuitive effect on the ''average'' quality of both groups: the ''un''favoured group will ''increase'' in average quality through attrition, and the favoured group will ''decrease'' in average quality, through a lack of it, ''even though no individual performance, in either group, changes''. | ||
On average, | On ''average'', Group A is paid progressively less. It looks like Group A members are being systematically discriminated against on pay, but this is a misleading artefact of [[averagarianism]] (Individually, ''no one’s'' pay changes). Group A members are being ''favoured for poor performance''. | ||
On a second glance, you can see why this should be so. The process systematically weeds out ''underperforming'' members of | On a second glance, you can see why this should be so. The process systematically weeds out ''underperforming'' members of unfavoured Group B, by culling them, and ''overperforming'' members of Group A — they will leave of their own will just like any outperformer. The “good” side of the distribution will progressively become Group B-dominated — they are not being bid away as frequently — and the “below par” section will become progressively Group A-dominated, as poor-performing Group B members are culled ahead of those from Group A. | ||