4 ms·

This kind of stack ranking was used at large investment bank (starts with M) about 10 years ago while I was working there as a C++ developer. It resulted in a

This kind of stack ranking was used at large investment bank (starts with M) about 10 years ago while I was working there as a C++ developer. It resulted in a strategy where some teams have hired puffer people with the only purpose to have poor performance ratings assigned to them and let them go when the demand for such inevitably rose for such from HR. This shielded the core team allowing them to focus solely on actual business requirements. There were people in the office taking decent salary, doing barely anything with kind of no expectations of their performance whatsoever. Some were doing their masters, some hit the gym very hard, some were just chilling out. This was my first lesson on how focus on tactical goals and metrics can fundamentally screw up the long term vision.

Foomf 4y ago
Goodhart's law is very similar in concept. https://en.wikipedia.org/wiki/Goodhart%27s_law https://en.wikipedia.org/wiki/Goodhart%27s_law
- cainxinth 4y ago
  Also brings this article to mind: https://en.wikipedia.org/wiki/Perverse_incentive https://en.wikipedia.org/wiki/Perverse_incentive
int0x2e 4y ago
Extremely well put. Any time a business decides on a metric / decision criteria, they introduce a strong incentive for their employees and managers to act accordingly. For some reason, leaders rarely seem to think hard enough about the possible outcomes. My anecdote - at a former big tech company, we had a long hiring freeze, and they even decided that when someone leaves or gets fired, their headcount goes back up to senior leadership who decide where that headcount should be (so as a manager, if you fire someone - you might lose the position entirely). So, naturally, even since then there have been zero people fired, even if they are low performers, since managers want to keep their headcount. But talented people obviously still get offers and leave, and when they leave, their headcount disappears. So after a year or so of this great policy, the average level of talent across the company is steadily dropping, which also means it'll be much harder to recruit top talent even after this policy is over - because most talented people want to join a team where they can still learn and evolve, collaborate with other smart folks, etc.
- jiggawatts 4y ago
  I have had several conversations where I explained that the consequence of a policy decision would be negative, and then the policy was rolled out anyway. For example, I explained that if it takes a foot-high pile of paperwork to obtain an internal use SSL certificate, then the highly predictable outcome of that policy is not "greater security", but unencrypted HTTP everywhere. The inevitable response to such feedback is that "people ought to do the right thing", which is laughable on its face. Nobody, and I mean nobody in their right mind will subject themselves to months of paperwork, procedure, and pleading for something that they consider to be optional. "But, but, the right thing is for them to jump through those hoops anyway!" is the typical response to such logic. This kind of argument is just futile. Someone up high has decided that they know better, that human nature will bend to their will, and will forge ahead despite being told they are wrong.
  - qikInNdOutReply 4y ago
    Its usually higher ups trying to get out of responsibilities. Force the lower tier out of using company systems, and the administration is "home free" upon incident responsibility.
  - TrueDuality 4y ago
    Preaching to the choir here, but I've been doing security for a long time and the only consistent way to make it work reliably is to make it invisible to the users it should apply to. It should add zero friction to what they would be doing anyway and ideally be the easier option. It's not always possible but having that as an end goal makes processes much more successful.
  - afpx 4y ago
    I've worked at companies that had inane policies with perverse incentives. And, it was pretty funny in a "A Confederacy of Dunces" sort of way. Compare that to other companies that practically gave out no-limit credit cards and full access: imagine which companies attracted the best talent. But, it amazes me just how long a company can survive being just mediocre and siloed. You often don't see the long-term effects until after those who implemented the policies have left or been promoted. I often look up those companies to see how they're doing. And, they're still chugging along, being barely profitable.
himinlomax 4y ago
As far as I know, stack ranking was first used, and with good success, by law firms. The thing is, the people being evaluated that way were on a career track to become partners in the firm, and as such they were evaluated by peers or rather future peers. Doing that with artists, writers, programmers and testers who have no expectation of eventually becoming board members and major shareholders is a whole different story and makes no sense.
rtontic 4y ago
This sounds like a (horrible) way to implement universal basic income. Just hire puffer people, have them do nothing. They get fired, hire them somewhere else, rinse, repeat.
- moonchrome 4y ago
  Except it's extremely demotivating for people doing actual work and getting paid similar money. My first job was in an old newspaper printing business (this was back when newspapers were highly profitable and a respected medium). We had a few old people in our department who were basically kept there doing nothing because they didn't want to retrain on new technology but they were friends with management so they weren't let go before retirement. Which sounds super humane and socially sensitive. Except there were a few of us new hires that couldn't get permanent contracts because the departments were "fully staffed", we were busting our ass and making 1/2 of what these guys were for doing nothing. And this "fair treatment" wasn't there for everyone - just the people who were friends with upper management - basically if you paid tribute by inviting a few people up to the management offices now and then, bring a bottle of nice booze and locking the door for a few hours, doing out of work favors, etc. There were people who were laid off and who had to retrain to remain. It was a sobering experience after my rosy childhood world views about fairness in society.
  - GuB-42 4y ago
    It is hard for the "puffer" people too. When they are on the clock, people generally want to be at least a little bit useful, at least do something that will be of value to someone. Sitting there doing nothing is not fun.
    - xiphias2 4y ago
      I think you don't know people them. There are lots of people who would love to just get their salary and date people online + do their private stuff all the time, and I think it's totally fine that not everybody wants to work hard. The problem here is of course that it's not good for people who are working hard. Sama is super proud that there are only 250 people in OpenAI, he understands that slackers destroy companies.
pja 4y ago
So long as you (the employee) know the score this sounds like a sweet gig. Work for a year or so at a nice leasuirely pace, save up, get to put large investment bank on your CV, move on. It’s the employees who don’t know that they’be been hired as the designated sacrificial goat I feel sorry for: That’s a potentially awful position to be in.
- blitzar 4y ago
  Anyone reading this thread and not looking around wondering "maybe I am the designated fire-ee ..." doesnt suffer from enough imposter syndrome.
seanhunter 4y ago
Agree. Happened at the IB I worked at. I remember a particular person who I was just baffled they kept around, so I asked his manager. "He's my designated fire-ee" I was told. "If in a given year I have to make a cut, he's the guy I cut and I know it won't affect productivity in the team. If someone leaves organically then he survives for another year". A lesson in perverse incentives.
- sokoloff 4y ago
  Also at an IB. Locally, they were called “cord wood” (as in stacked firewood). It was so crazily wasteful.
LewisVerstappen 4y ago
Next time you need a puffer person, please let me know. Would be awesome to get a 6 figure salary on the side while I work on my startup. (I'm very good at leetcode-interview BS so will have no problem passing your interview and will be happy to take the severance when you need to fire me)
- cudgy 4y ago
  The irony would be that the top performers would get and want the puffer positions, while the “suckers” did the work.
- diggernet 4y ago
  Hiring managers: Don't fall for the parent's game. Their leetcode skills prove that they are just trying to trick you into hiring them, after which they will become a valuable member of your team, making your next firing more difficult. If you really want a puffer person, hire me. I'll take the position with no interview, demonstrating my commitment to putting zero effort into your project. Edit: And don't worry about any bidding war with other managers. I'll just put you in my queue and rotate through you all as needed.
wodenokoto 4y ago
> Some were doing their masters, some hit the gym very hard, some were just chilling out. So ... how do I apply for such a puffer position?
DannyBee 4y ago
(I actually think most stack ranking is dumb, but the comment you made is a very common response and i honestly don't get it) "This was my first lesson on how focus on tactical goals and metrics can fundamentally screw up the long term vision." I don't get how you take that away from this - this is a lesson in how bad managers who refuse to do what is asked, and apparently have no accountability, can screw up the system. Stack ranking may be good or bad, but if your managers are working around the system, and nobody is holding them accountable for it, that's a separate, and honestly bigger, problem. If they actually did what was really being asked (instead of trying to work around it), either 1. it would work, and the company would be better off. 2. it would fail miserably, and the company would either stop doing that (and be better off) or go bankrupt (and we'd all be better off because it would be an object lesson). The reason this went badly is precisely because of a lack of real accountability, not because of stack ranking itself.
- solatic 4y ago
  The point is that if you can game the system, and the system cannot determine that it is being gamed, then it's a bad system. Who watches the watchmen? In a large-enough organization, the stack ranking system is set by some executive high up the mountain. The low-level line managers and group managers are incentivized to work together to get the budget (for puffer employees) to help them keep their proven performers. Finance doesn't care as long as (a) the bottom-line improvements from firing puffers keep getting realized and (b) management keeps being able to pay puffers below-market salaries. Puffers themselves shouldn't care in this day and age, taking the opportunity to take the puffer paycheck as a 100% remote position with no actual responsibility, while working full-time somewhere else that actually appreciates them, so puffers basically get a free paycheck out of it for nothing. It doesn't matter if it's a good system in theory. It only matters if it works in practice. There's an old joke about economists - they treat the real world as a special case.
  - DannyBee 4y ago
    First, the system described by OP is super easy to see who is gaming it. Everyone knows, too! So it doesn't even fail your first test of "the system can't tell". The system can tell. It's just not doing anything about it. That's the failure i'm describing. Beyond that: If people work around the system, it will never work, regardless of the system. Any system can be worked around, good or not. There are no magically good systems that can't be worked around, or don't even incentivize people to work around them. All good systems try to deal with bad actors in some way. If they don't, they fail. Plain and simple. Saying that any system that doesn't work because it has bad actors is a bad system is silly. You will no-true-scotsman your way into having no systems at all.
red-iron-pine 4y ago
> There were people in the office taking decent salary, doing barely anything with kind of no expectations of their performance whatsoever. Some were doing their masters, some hit the gym very hard, some were just chilling out. I am pretty sure I am this person right now. Got the job but mostly not qualified for it, though I'll concede it's a niche field and they probably have to train people regardless. But it feels square-peg round-hole. What do?
- rahimnathwani 4y ago
  Do a masters or hit the gym?
- Sohcahtoa82 4y ago
  Work on side projects to keep your skills sharp so you're ready to apply for new jobs once the inevitable happens.
- blitzar 4y ago
  Always keep your CV up to date (its soo hard to write a CV the day after you get fired), browse the job ads and watch for the buzz words and keep the skills in those words fresh and go to the gym.
michaelcampbell 4y ago
Goodhart's Law in action.
hodgesrm 4y ago
> It resulted in a strategy where some teams have hired puffer people with the only purpose to have poor performance ratings assigned to them and let them go when the demand for such inevitably rose for such from HR. Those people are known as "sacrificial lambs." I ran across the term in a previous position. More than one person specifically included this concept in their planning.

Foomf 4y ago

Goodhart's law is very similar in concept. https://en.wikipedia.org/wiki/Goodhart%27s_law https://en.wikipedia.org/wiki/Goodhart%27s_law

cainxinth 4y ago
Also brings this article to mind: https://en.wikipedia.org/wiki/Perverse_incentive https://en.wikipedia.org/wiki/Perverse_incentive

int0x2e 4y ago

Extremely well put. Any time a business decides on a metric / decision criteria, they introduce a strong incentive for their employees and managers to act accordingly. For some reason, leaders rarely seem to think hard enough about the possible outcomes. My anecdote - at a former big tech company, we had a long hiring freeze, and they even decided that when someone leaves or gets fired, their headcount goes back up to senior leadership who decide where that headcount should be (so as a manager, if you fire someone - you might lose the position entirely). So, naturally, even since then there have been zero people fired, even if they are low performers, since managers want to keep their headcount. But talented people obviously still get offers and leave, and when they leave, their headcount disappears. So after a year or so of this great policy, the average level of talent across the company is steadily dropping, which also means it'll be much harder to recruit top talent even after this policy is over - because most talented people want to join a team where they can still learn and evolve, collaborate with other smart folks, etc.

jiggawatts 4y ago
I have had several conversations where I explained that the consequence of a policy decision would be negative, and then the policy was rolled out anyway. For example, I explained that if it takes a foot-high pile of paperwork to obtain an internal use SSL certificate, then the highly predictable outcome of that policy is not "greater security", but unencrypted HTTP everywhere. The inevitable response to such feedback is that "people ought to do the right thing", which is laughable on its face. Nobody, and I mean nobody in their right mind will subject themselves to months of paperwork, procedure, and pleading for something that they consider to be optional. "But, but, the right thing is for them to jump through those hoops anyway!" is the typical response to such logic. This kind of argument is just futile. Someone up high has decided that they know better, that human nature will bend to their will, and will forge ahead despite being told they are wrong.
- qikInNdOutReply 4y ago
  Its usually higher ups trying to get out of responsibilities. Force the lower tier out of using company systems, and the administration is "home free" upon incident responsibility.
- TrueDuality 4y ago
  Preaching to the choir here, but I've been doing security for a long time and the only consistent way to make it work reliably is to make it invisible to the users it should apply to. It should add zero friction to what they would be doing anyway and ideally be the easier option. It's not always possible but having that as an end goal makes processes much more successful.
- afpx 4y ago
  I've worked at companies that had inane policies with perverse incentives. And, it was pretty funny in a "A Confederacy of Dunces" sort of way. Compare that to other companies that practically gave out no-limit credit cards and full access: imagine which companies attracted the best talent. But, it amazes me just how long a company can survive being just mediocre and siloed. You often don't see the long-term effects until after those who implemented the policies have left or been promoted. I often look up those companies to see how they're doing. And, they're still chugging along, being barely profitable.

himinlomax 4y ago

As far as I know, stack ranking was first used, and with good success, by law firms. The thing is, the people being evaluated that way were on a career track to become partners in the firm, and as such they were evaluated by peers or rather future peers. Doing that with artists, writers, programmers and testers who have no expectation of eventually becoming board members and major shareholders is a whole different story and makes no sense.

rtontic 4y ago

This sounds like a (horrible) way to implement universal basic income. Just hire puffer people, have them do nothing. They get fired, hire them somewhere else, rinse, repeat.

moonchrome 4y ago
Except it's extremely demotivating for people doing actual work and getting paid similar money. My first job was in an old newspaper printing business (this was back when newspapers were highly profitable and a respected medium). We had a few old people in our department who were basically kept there doing nothing because they didn't want to retrain on new technology but they were friends with management so they weren't let go before retirement. Which sounds super humane and socially sensitive. Except there were a few of us new hires that couldn't get permanent contracts because the departments were "fully staffed", we were busting our ass and making 1/2 of what these guys were for doing nothing. And this "fair treatment" wasn't there for everyone - just the people who were friends with upper management - basically if you paid tribute by inviting a few people up to the management offices now and then, bring a bottle of nice booze and locking the door for a few hours, doing out of work favors, etc. There were people who were laid off and who had to retrain to remain. It was a sobering experience after my rosy childhood world views about fairness in society.
- GuB-42 4y ago
  It is hard for the "puffer" people too. When they are on the clock, people generally want to be at least a little bit useful, at least do something that will be of value to someone. Sitting there doing nothing is not fun.
  - xiphias2 4y ago
    I think you don't know people them. There are lots of people who would love to just get their salary and date people online + do their private stuff all the time, and I think it's totally fine that not everybody wants to work hard. The problem here is of course that it's not good for people who are working hard. Sama is super proud that there are only 250 people in OpenAI, he understands that slackers destroy companies.

pja 4y ago

So long as you (the employee) know the score this sounds like a sweet gig. Work for a year or so at a nice leasuirely pace, save up, get to put large investment bank on your CV, move on. It’s the employees who don’t know that they’be been hired as the designated sacrificial goat I feel sorry for: That’s a potentially awful position to be in.

blitzar 4y ago
Anyone reading this thread and not looking around wondering "maybe I am the designated fire-ee ..." doesnt suffer from enough imposter syndrome.

seanhunter 4y ago

Agree. Happened at the IB I worked at. I remember a particular person who I was just baffled they kept around, so I asked his manager. "He's my designated fire-ee" I was told. "If in a given year I have to make a cut, he's the guy I cut and I know it won't affect productivity in the team. If someone leaves organically then he survives for another year". A lesson in perverse incentives.

sokoloff 4y ago
Also at an IB. Locally, they were called “cord wood” (as in stacked firewood). It was so crazily wasteful.

LewisVerstappen 4y ago

Next time you need a puffer person, please let me know. Would be awesome to get a 6 figure salary on the side while I work on my startup. (I'm very good at leetcode-interview BS so will have no problem passing your interview and will be happy to take the severance when you need to fire me)

cudgy 4y ago
The irony would be that the top performers would get and want the puffer positions, while the “suckers” did the work.
diggernet 4y ago
Hiring managers: Don't fall for the parent's game. Their leetcode skills prove that they are just trying to trick you into hiring them, after which they will become a valuable member of your team, making your next firing more difficult. If you really want a puffer person, hire me. I'll take the position with no interview, demonstrating my commitment to putting zero effort into your project. Edit: And don't worry about any bidding war with other managers. I'll just put you in my queue and rotate through you all as needed.

wodenokoto 4y ago

> Some were doing their masters, some hit the gym very hard, some were just chilling out. So ... how do I apply for such a puffer position?

DannyBee 4y ago

(I actually think most stack ranking is dumb, but the comment you made is a very common response and i honestly don't get it) "This was my first lesson on how focus on tactical goals and metrics can fundamentally screw up the long term vision." I don't get how you take that away from this - this is a lesson in how bad managers who refuse to do what is asked, and apparently have no accountability, can screw up the system. Stack ranking may be good or bad, but if your managers are working around the system, and nobody is holding them accountable for it, that's a separate, and honestly bigger, problem. If they actually did what was really being asked (instead of trying to work around it), either 1. it would work, and the company would be better off. 2. it would fail miserably, and the company would either stop doing that (and be better off) or go bankrupt (and we'd all be better off because it would be an object lesson). The reason this went badly is precisely because of a lack of real accountability, not because of stack ranking itself.

solatic 4y ago
The point is that if you can game the system, and the system cannot determine that it is being gamed, then it's a bad system. Who watches the watchmen? In a large-enough organization, the stack ranking system is set by some executive high up the mountain. The low-level line managers and group managers are incentivized to work together to get the budget (for puffer employees) to help them keep their proven performers. Finance doesn't care as long as (a) the bottom-line improvements from firing puffers keep getting realized and (b) management keeps being able to pay puffers below-market salaries. Puffers themselves shouldn't care in this day and age, taking the opportunity to take the puffer paycheck as a 100% remote position with no actual responsibility, while working full-time somewhere else that actually appreciates them, so puffers basically get a free paycheck out of it for nothing. It doesn't matter if it's a good system in theory. It only matters if it works in practice. There's an old joke about economists - they treat the real world as a special case.
- DannyBee 4y ago
  First, the system described by OP is super easy to see who is gaming it. Everyone knows, too! So it doesn't even fail your first test of "the system can't tell". The system can tell. It's just not doing anything about it. That's the failure i'm describing. Beyond that: If people work around the system, it will never work, regardless of the system. Any system can be worked around, good or not. There are no magically good systems that can't be worked around, or don't even incentivize people to work around them. All good systems try to deal with bad actors in some way. If they don't, they fail. Plain and simple. Saying that any system that doesn't work because it has bad actors is a bad system is silly. You will no-true-scotsman your way into having no systems at all.

red-iron-pine 4y ago

> There were people in the office taking decent salary, doing barely anything with kind of no expectations of their performance whatsoever. Some were doing their masters, some hit the gym very hard, some were just chilling out. I am pretty sure I am this person right now. Got the job but mostly not qualified for it, though I'll concede it's a niche field and they probably have to train people regardless. But it feels square-peg round-hole. What do?

rahimnathwani 4y ago
Do a masters or hit the gym?
Sohcahtoa82 4y ago
Work on side projects to keep your skills sharp so you're ready to apply for new jobs once the inevitable happens.
blitzar 4y ago
Always keep your CV up to date (its soo hard to write a CV the day after you get fired), browse the job ads and watch for the buzz words and keep the skills in those words fresh and go to the gym.

michaelcampbell 4y ago

Goodhart's Law in action.

hodgesrm 4y ago

> It resulted in a strategy where some teams have hired puffer people with the only purpose to have poor performance ratings assigned to them and let them go when the demand for such inevitably rose for such from HR. Those people are known as "sacrificial lambs." I ran across the term in a previous position. More than one person specifically included this concept in their planning.