6 ms·

On a related note, some of the more effective companies I've worked for have had strong "up or out" cultures. Now, I know that this sounds harsh and draconian a

On a related note, some of the more effective companies I've worked for have had strong "up or out" cultures. Now, I know that this sounds harsh and draconian at first. And it conjures up images of political intrigue, heated power struggles, and corporate backstabbing. But truth be told, I've actually found those evils to be more prevalent in companies that don't cull their dead weight. What happens is that these firms accumulate a vast, stagnant layer of middle and upper management types who have no incentive to work any harder, take new risks, or develop talented employees. Instead, they're simply cashing in on a safe paycheck, riding a pretty cushy high horse, and fiercely fending off anyone they perceive to be competition for their sweet gigs. Compounding this problem is the fact that mobility slows to a crawl, because the queue is full. This breeds dissatisfaction with the young, ambitious types, while simultaneously breeding resentment among the older, entrenched types who adopt the grumbly "kids these days..." defensive mentality. Now, there are plenty of ways to screw up the up-or-out system: bad KPIs and standards, inept evaluation processes, etc. But no system is perfect, and at least a system that forces honest dialogue with managers about their future advancement prospects is better than a system wherein lousy managers can overstay their welcome.

dasmoth 14y ago
I imagine it works best if there are at least some "up" paths which don't lead into management.
michaelt 14y ago
Interesting. What does 'up or out' do with senior engineers who don't want to start managing people? Do they leave the company?
- ryanmolden 14y ago
  At least at Microsoft, and I assume other primarily tech companies, there are level bands (job titles) above "senior developer" (principal, partner, technical fellow, distinguished engineer) that have nothing to do with management. Generally one can have a full career striving for technical fellow/distinguished engineer without stagnating (though not necessarily achieving it, tis a lofty accomplishment).
  - hkmurakami 14y ago
    I know that HP Labs has a similar arrangement.
    - whatusername 14y ago
      Same with IBM.
- calpaterson 14y ago
  They go out, obviously. Up or out is only better than the very worst cultures. Given how maddeningly difficult it is to find competent people at any pay grade it seems extremely stupid to chuck everyone out after a while. It also implies a bias towards promoting from within, which is a great way to create cultural stagnation.
- arethuza 14y ago
  The only places I've ever heard of with a strong "up or out" culture are based on professional services.
- jamesaguilar 14y ago
  Some companies have thresholds after which up or out is no longer the case. The logic being, below this level, your seniors are putting more work into you than you are producing (i.e. holding your hand, reviewing your work, generating new work for you to do, etc.). After you pass the threshold where you are a net contributor, you no longer have to go up if you don't want. Not sure how common this practice is.
- blablabla123 14y ago
  I once had a job interview at a small software consultant firm. 30 or 40 employees in 6 offices. They also had a demanding policy, probably not strict 'up or out' like at McKinsey or Deutsche Bank but they do fire people when they don't perform well enough. One of the guys who interviewed me was one of the 2 or 3 highest ranking people there and a technical person. That was their deal: you start out as Junior Developer and when you are there for 5 or so years, you can decide whether you specialize into technical stuff or people stuff. From phone calls with recruiters I had the impression this is not an unusual model.
bane 14y ago
I agree that companies that don't cut the dead weight have tremendous amounts of very bad internal politicking, up-or-out organizations tend to have politics optimized around moving up...which is very rarely tied to any sort of work performance. The U.S. military has a similar up-or-out policy (especially among the officer corps) and the result is (more often than not I'd say) yes men who latch onto a strong leader type and ride his coattails into a senior officer position. The result is poorly informed and advised leaders, and senior staff who spend their time figuring out if what they're doing will be approved "by the old man" instead of actually promoting the function of the organization, fight and win wars.
- jonnathanson 14y ago
  I'd argue that this problem exists in any large bureaucratic culture, and that its prevalence is often just as bad in non up-or-out environments. The key difference between up-or-out and the alternative is that, in the alternative, a certain segment of the employee base plays the politics game, and a certain segment kicks back and stagnates in the middle, while the rest try to get ahead honestly. In up-or-out, at least the third category has a decent shot. In non-up-or-out, the people trying to work hard and advance on merit will run up against the entrenched slackocracy and the political Machiavellians.
  - bane 14y ago
    It's almost like you're describing the dichotomy between military officers and civilian federal government jobs, where somebody can chill in a GS-13 position for 20 years and then retire.
  - lifeguard 14y ago
    False equivocation. The problems are not all of the same severity, and it is a fallacy to say they are "all the same" just because you use the same word, problems.
    - jonnathanson 14y ago
      I didn't say that. In my post, "problem" was referring to the parent post's "politics organized around moving up." My point is that most corporate cultures have elements of that focus on upward mobility. Obviously its prevalence varies from company to company. But I'd rather take a culture with an over-focus on upward mobility and potential for upward mobility than a culture with even a lesser focus on upward mobility, but less potential for it (due to all the dead weight). I'm not holding "focus on upward mobility" equal in that assessment.
talkingquickly 14y ago
I can see the benefit here of keeping people motivated to continually achieve more but it seems based on the assumption that everyone is capable of going all the way to the top. In the worst case scenario, a large number of people go "up" to the point where they're no longer capable of doing the job they're in and then go "out" after a brief period of doing their job badly. These people may well have been very competent at their previous level of authority and so the business as a whole loses out. Additionally companies which state outright this is their policy often have quotas of people who should go "out" which I've seen, in particularly talented groups, lead to an almost random selection of people going out despite the entire group being so close together in ability than no meaningful distinctions can be made. EDIT: re jonnathanson response below, agree completely that if up can mean a person is performing solidly and achieving good results while improving year on year then such a system can be very beneficial. My criticism is much more focussed on systems where up explicitly means moving through grades, especially where there are attempts to apply quotas to who goes up and who goes out.
- jonnathanson 14y ago
  I think it depends on how we define "up." I think it's entirely fair to have a culture that encourages up-or-out, wherein "up" may mean professional advancement, or it may simply mean that the person is performing solidly and achieving good results, or improving year over year. In this case, "up" means improvement more than it necessarily and literally means up the ladder. I realize this reponse could be interpreted as a bit of a no-true-Scotsman reply, but honestly, it's intended to be a clarification of my original post.
- msluyter 14y ago
  "In the worst case scenario, a large number of people go "up" to the point where they're no longer capable of doing the job they're in and then go "out" after a brief period of doing their job badly." AKA, "The Peter Principle." http://en.wikipedia.org/wiki/Peter_Principle http://en.wikipedia.org/wiki/Peter_Principle -- The Peter Principle is a belief that, in an organization where promotion is based on achievement, success, and merit, that organization's members will eventually be promoted beyond their level of ability. The principle is commonly phrased, "Employees tend to rise to their level of incompetence." In more formal parlance, the effect could be stated as: employees tend to be given more authority until they cannot continue to work competently. It was formulated by Laurence J. Peter and Raymond Hull in their 1969 book The Peter Principle, a humorous[1] treatise, which also introduced the "salutary science of hierarchiology".
areahouse40 14y ago
Well, that's how Jack Welch managed GE back in his days. He made it pretty clear that in order to move up they either became a black belt or move out.

dasmoth 14y ago

I imagine it works best if there are at least some "up" paths which don't lead into management.

michaelt 14y ago

Interesting. What does 'up or out' do with senior engineers who don't want to start managing people? Do they leave the company?

ryanmolden 14y ago
At least at Microsoft, and I assume other primarily tech companies, there are level bands (job titles) above "senior developer" (principal, partner, technical fellow, distinguished engineer) that have nothing to do with management. Generally one can have a full career striving for technical fellow/distinguished engineer without stagnating (though not necessarily achieving it, tis a lofty accomplishment).
- hkmurakami 14y ago
  I know that HP Labs has a similar arrangement.
  - whatusername 14y ago
    Same with IBM.
calpaterson 14y ago
They go out, obviously. Up or out is only better than the very worst cultures. Given how maddeningly difficult it is to find competent people at any pay grade it seems extremely stupid to chuck everyone out after a while. It also implies a bias towards promoting from within, which is a great way to create cultural stagnation.
arethuza 14y ago
The only places I've ever heard of with a strong "up or out" culture are based on professional services.
jamesaguilar 14y ago
Some companies have thresholds after which up or out is no longer the case. The logic being, below this level, your seniors are putting more work into you than you are producing (i.e. holding your hand, reviewing your work, generating new work for you to do, etc.). After you pass the threshold where you are a net contributor, you no longer have to go up if you don't want. Not sure how common this practice is.
blablabla123 14y ago
I once had a job interview at a small software consultant firm. 30 or 40 employees in 6 offices. They also had a demanding policy, probably not strict 'up or out' like at McKinsey or Deutsche Bank but they do fire people when they don't perform well enough. One of the guys who interviewed me was one of the 2 or 3 highest ranking people there and a technical person. That was their deal: you start out as Junior Developer and when you are there for 5 or so years, you can decide whether you specialize into technical stuff or people stuff. From phone calls with recruiters I had the impression this is not an unusual model.

bane 14y ago

I agree that companies that don't cut the dead weight have tremendous amounts of very bad internal politicking, up-or-out organizations tend to have politics optimized around moving up...which is very rarely tied to any sort of work performance. The U.S. military has a similar up-or-out policy (especially among the officer corps) and the result is (more often than not I'd say) yes men who latch onto a strong leader type and ride his coattails into a senior officer position. The result is poorly informed and advised leaders, and senior staff who spend their time figuring out if what they're doing will be approved "by the old man" instead of actually promoting the function of the organization, fight and win wars.

jonnathanson 14y ago
I'd argue that this problem exists in any large bureaucratic culture, and that its prevalence is often just as bad in non up-or-out environments. The key difference between up-or-out and the alternative is that, in the alternative, a certain segment of the employee base plays the politics game, and a certain segment kicks back and stagnates in the middle, while the rest try to get ahead honestly. In up-or-out, at least the third category has a decent shot. In non-up-or-out, the people trying to work hard and advance on merit will run up against the entrenched slackocracy and the political Machiavellians.
- bane 14y ago
  It's almost like you're describing the dichotomy between military officers and civilian federal government jobs, where somebody can chill in a GS-13 position for 20 years and then retire.
- lifeguard 14y ago
  False equivocation. The problems are not all of the same severity, and it is a fallacy to say they are "all the same" just because you use the same word, problems.
  - jonnathanson 14y ago
    I didn't say that. In my post, "problem" was referring to the parent post's "politics organized around moving up." My point is that most corporate cultures have elements of that focus on upward mobility. Obviously its prevalence varies from company to company. But I'd rather take a culture with an over-focus on upward mobility and potential for upward mobility than a culture with even a lesser focus on upward mobility, but less potential for it (due to all the dead weight). I'm not holding "focus on upward mobility" equal in that assessment.

talkingquickly 14y ago

I can see the benefit here of keeping people motivated to continually achieve more but it seems based on the assumption that everyone is capable of going all the way to the top. In the worst case scenario, a large number of people go "up" to the point where they're no longer capable of doing the job they're in and then go "out" after a brief period of doing their job badly. These people may well have been very competent at their previous level of authority and so the business as a whole loses out. Additionally companies which state outright this is their policy often have quotas of people who should go "out" which I've seen, in particularly talented groups, lead to an almost random selection of people going out despite the entire group being so close together in ability than no meaningful distinctions can be made. EDIT: re jonnathanson response below, agree completely that if up can mean a person is performing solidly and achieving good results while improving year on year then such a system can be very beneficial. My criticism is much more focussed on systems where up explicitly means moving through grades, especially where there are attempts to apply quotas to who goes up and who goes out.

jonnathanson 14y ago
I think it depends on how we define "up." I think it's entirely fair to have a culture that encourages up-or-out, wherein "up" may mean professional advancement, or it may simply mean that the person is performing solidly and achieving good results, or improving year over year. In this case, "up" means improvement more than it necessarily and literally means up the ladder. I realize this reponse could be interpreted as a bit of a no-true-Scotsman reply, but honestly, it's intended to be a clarification of my original post.
msluyter 14y ago
"In the worst case scenario, a large number of people go "up" to the point where they're no longer capable of doing the job they're in and then go "out" after a brief period of doing their job badly." AKA, "The Peter Principle." http://en.wikipedia.org/wiki/Peter_Principle http://en.wikipedia.org/wiki/Peter_Principle -- The Peter Principle is a belief that, in an organization where promotion is based on achievement, success, and merit, that organization's members will eventually be promoted beyond their level of ability. The principle is commonly phrased, "Employees tend to rise to their level of incompetence." In more formal parlance, the effect could be stated as: employees tend to be given more authority until they cannot continue to work competently. It was formulated by Laurence J. Peter and Raymond Hull in their 1969 book The Peter Principle, a humorous[1] treatise, which also introduced the "salutary science of hierarchiology".

areahouse40 14y ago

Well, that's how Jack Welch managed GE back in his days. He made it pretty clear that in order to move up they either became a black belt or move out.