I'm not totally in love with the notion, and now that I'm in my own company we do not do it that way at all. However, by giving the manager a pool, my old compa

I'm not totally in love with the notion, and now that I'm in my own company we do not do it that way at all. However, by giving the manager a pool, my old company was empowering that manager to spend the money as they saw fit. There was no stack ranking or any other political BS. Here's your pool, do with it as you wish. So, if you ask me, zero sum sucks, but it at very least lets the person closest to the action get a chance to make a call. It also prevented the managers from just handing out raises for no real reason. For example, you've got two people that have had great years and another that's just been treading water. If you give them the raise you want to, you're going to wind up with nothing left for the third. With an unlimited sum of money at your disposal you may kick that person a percent or two to prevent hurt feelings, now you've got to make the hard call. Or, if that third person also had a good year and you want to fight for them, you can run it up the chain and shake out a few percent for them. It was always there for the asking if you felt like going through some effort to get it. So yeah, there's better ways to do it, but it's also not completely awful either.