5 ms·

I have posted this before, an argument in defense of stack ranking I had heard from a friend's father who was a long-time manager for a large industrial conglom

by JackFr 3y ago

I have posted this before, an argument in defense of stack ranking I had heard from a friend's father who was a long-time manager for a large industrial conglomerate from the 60's through the 80's. Simply put it was that they were far more willing to hire non-standard candidates on gut and hunches, knowing that if it didn't work out, it didn't work out they would be gone in 1-1.5 years and it would not be a ding against the hiring manager. Further, at least in that day, it was an environment where everyone was going in with their eyes open -- people were not blindsided by it, they expected it. But as you point out, the FAANG's are doing the opposite of this. They've got extremely difficult hiring processes and are pretending that it's not stack ranking.

ep103 3y ago
Stack Ranking was pioneered by Jack Welch who was operating in an environment where labor was the dominant party in the labor-capital relationship, and he was taking over companies that had had decades of labor growth and power while capital was stagflating nationwide. Introducing stack ranking was a way of trimming excess fat from decades of build up within companies, while reasserting capital in the relationship within the company. Long term, it has been a disaster in every company. Because eventually you run out of fat, and then what you describe as "far more willing to hire non-standard candidates on gut and hunches, knowing that if it didn't work out, it didn't work out they would be gone" becomes "I need to hire people I don't want to work with, so I have someone to fire in the next stack rank". And that's its own form of fat. In short, stack ranking makes some sense if you have a fat organization, not unlike restricting calories to lose fat when working out. But once you've lost fat, continuing to restrict your calories results in losing more muscle than fat.
- psunavy03 3y ago
  > "I need to hire people I don't want to work with, so I have someone to fire in the next stack rank". And that's its own form of fat. There's a great long-form article on this called "Microsoft's Lost Decade."
  - Terr_ 3y ago
    Ref: https://www.vanityfair.com/news/business/2012/08/microsoft-lost-mojo-steve-ballmer https://www.vanityfair.com/news/business/2012/08/microsoft-l...
- steveBK123 3y ago
  Jack Welch also mostly made his mark by juicing earnings via both financializing the whole company going into the GFC, and by doing various forms of (probably illegal then, definitely now) accounting tricks to smooth earnings to always make his number. GE was run into the ground by his tenure.
  - twiddling 3y ago
    This. GE Financial was an earnings laundering operation
- therealdrag0 3y ago
  Isn’t that just a tuning problem? If the required fire % is low enough relative to hiring rate then people won’t hire to fire.
psunavy03 3y ago
Having been a Navy officer for 20 years active and reserve, one of the other overlooked flaws of the stack rank is that it's a vehicle for cultivating egos. When the only way up is through many levels of being "1 of X, Early Promote," it's fascinating to watch a bright-eyed humble flight student turn into a condescending jerk of an instructor over the years. Turning the performance review system into "winners" and "losers" and telling a subset of people they're the winners tends to break some people's brains. Because why should they have to listen to anyone who hasn't gotten as good performance reviews as them? Obviously, they care more and those other slackers just couldn't cut it.
- giantg2 3y ago
  I have a friend who is getting out (technically going reserve). It sounds like there are lot of factors impacting retention and most of them are being ignored. Why should the leaders focus on things they are a part of and admit fault if they can simply blame stuff on civilian cultural issues or subordinate "weakness"? I heard some of the cyber warfare units are proposing to bring in people in as high as O5. No way that causes any related problems...
  - psunavy03 3y ago
    IMHO there's a huge blind spot in leadership exactly due to the stack rank, because how do you recommend changes to the system to someone who succeeded and owes their whole career and professional reputation to that system? The answer's going to be "well it worked for me, so it must not be that bad." The other part of the problem is yes, there are times when the military has every right to expect folks to endure hardship. I mean, the whole point is to send folks into combat if needed, and combat sucks. Being in the field or underway for months at a time sucks, but they're necessary. But because of this, it's easy to slip into "just suck it up" as a response to a whole bunch of hardship, stupidity, or inefficiency that isn't necessary. The reserves have their own breed of stupidity revolving around reserve center staff enforcing Kafkaesque bureaucratic "readiness" requirements on the drilling reservists. At some point, taking 1/4 of your weekends off to come in and be told you're delinquent on something you turned in three times already, or having to flail to complete some late-breaking tasker gets old. I loved supporting my gaining active duty commands. I retired because I got sick of the hoops I had to jump through to keep doing it. Cyber is having to bring folks in at a high level to get the experience base they desperately need. This isn't totally unusual though. Surgeons have come in at that level when the military has needed their expertise. And in WWII, FDR brought in an automotive executive as a general officer to supervise wartime production.

by JackFr 3y ago

ep103 3y ago

Stack Ranking was pioneered by Jack Welch who was operating in an environment where labor was the dominant party in the labor-capital relationship, and he was taking over companies that had had decades of labor growth and power while capital was stagflating nationwide. Introducing stack ranking was a way of trimming excess fat from decades of build up within companies, while reasserting capital in the relationship within the company. Long term, it has been a disaster in every company. Because eventually you run out of fat, and then what you describe as "far more willing to hire non-standard candidates on gut and hunches, knowing that if it didn't work out, it didn't work out they would be gone" becomes "I need to hire people I don't want to work with, so I have someone to fire in the next stack rank". And that's its own form of fat. In short, stack ranking makes some sense if you have a fat organization, not unlike restricting calories to lose fat when working out. But once you've lost fat, continuing to restrict your calories results in losing more muscle than fat.

psunavy03 3y ago
> "I need to hire people I don't want to work with, so I have someone to fire in the next stack rank". And that's its own form of fat. There's a great long-form article on this called "Microsoft's Lost Decade."
- Terr_ 3y ago
  Ref: https://www.vanityfair.com/news/business/2012/08/microsoft-lost-mojo-steve-ballmer https://www.vanityfair.com/news/business/2012/08/microsoft-l...
steveBK123 3y ago
Jack Welch also mostly made his mark by juicing earnings via both financializing the whole company going into the GFC, and by doing various forms of (probably illegal then, definitely now) accounting tricks to smooth earnings to always make his number. GE was run into the ground by his tenure.
- twiddling 3y ago
  This. GE Financial was an earnings laundering operation
therealdrag0 3y ago
Isn’t that just a tuning problem? If the required fire % is low enough relative to hiring rate then people won’t hire to fire.

psunavy03 3y ago

Having been a Navy officer for 20 years active and reserve, one of the other overlooked flaws of the stack rank is that it's a vehicle for cultivating egos. When the only way up is through many levels of being "1 of X, Early Promote," it's fascinating to watch a bright-eyed humble flight student turn into a condescending jerk of an instructor over the years. Turning the performance review system into "winners" and "losers" and telling a subset of people they're the winners tends to break some people's brains. Because why should they have to listen to anyone who hasn't gotten as good performance reviews as them? Obviously, they care more and those other slackers just couldn't cut it.

giantg2 3y ago
I have a friend who is getting out (technically going reserve). It sounds like there are lot of factors impacting retention and most of them are being ignored. Why should the leaders focus on things they are a part of and admit fault if they can simply blame stuff on civilian cultural issues or subordinate "weakness"? I heard some of the cyber warfare units are proposing to bring in people in as high as O5. No way that causes any related problems...
- psunavy03 3y ago
  IMHO there's a huge blind spot in leadership exactly due to the stack rank, because how do you recommend changes to the system to someone who succeeded and owes their whole career and professional reputation to that system? The answer's going to be "well it worked for me, so it must not be that bad." The other part of the problem is yes, there are times when the military has every right to expect folks to endure hardship. I mean, the whole point is to send folks into combat if needed, and combat sucks. Being in the field or underway for months at a time sucks, but they're necessary. But because of this, it's easy to slip into "just suck it up" as a response to a whole bunch of hardship, stupidity, or inefficiency that isn't necessary. The reserves have their own breed of stupidity revolving around reserve center staff enforcing Kafkaesque bureaucratic "readiness" requirements on the drilling reservists. At some point, taking 1/4 of your weekends off to come in and be told you're delinquent on something you turned in three times already, or having to flail to complete some late-breaking tasker gets old. I loved supporting my gaining active duty commands. I retired because I got sick of the hoops I had to jump through to keep doing it. Cyber is having to bring folks in at a high level to get the experience base they desperately need. This isn't totally unusual though. Surgeons have come in at that level when the military has needed their expertise. And in WWII, FDR brought in an automotive executive as a general officer to supervise wartime production.