It was an unmitigated disaster, and it bears notice in companies which use a similar process, "Stack Ranking", to manage their employees.
Amazon is the most notable, and most aggressive adherent of this philosophy:
Jeff Bezos, CEO and founder of Amazon, recently took some heat when the New York Times exposed working conditions and the corporate culture at his firm. ‘Ruthless’ and ‘demanding’ are two descriptors of the working environment, sink or swim. Amazon is not alone. Some of the leading recent startups have competitive employment requirements, a survival of the fittest approach. They want the best and push out the rest. It’s a simple notion to strengthening your company and the most efficient way to assemble optimally performing groups, organizations, and sports teams. Or at least that has been the dominant rhetoric behind models of group productivity within both the business and sporting industries. Stack-ranking and other business practices of individual selection have been widespread, from General Electric to Microsoft, and is a standard modus operandi in sports teams including the focus of this piece, the European soccer team, Real Madrid. However, the wisdom behind the application of these models, both in business and sport, is under scrutiny. To begin to see why, we turn to evolutionary biology.Much of the American management class, and Jeff Bezos in particular, seem to see Lord of the Flies as a model for how to manage employees.
In 1996, evolutionary biologist William Muir conducted a series of unusual experiments at Purdue University. Muir was looking to explore the various methods of group productivity with regards to egg production. He wanted to create a group of ‘Super-Chickens’ who would produce more eggs than any other coop. He followed the logic that many employers today tout: take the best individuals, put them in a group together, and then let the magic happen. Muir selected the most productive hens from each cage and bred the next generation from them. Muir also identified the cages that collectively were more productive at laying eggs in comparison to other cages. He then continued to selectively breed using these two separate groups and observed the levels of production.
The outcome of this study was striking; selecting the best group cages produced hens that thoroughly outperformed the line of individually more productive ‘Super-Chickens’. For the cage-selected line, after just five generations, the number of eggs per hen catapulted from 91 to 237, the mortality rate of the group crashed from 68% to 9%, and the hens also displayed improved wellbeing as a function of the reductions of pecking and negative social interactions.
The Super-Chicken group did not fare so well. In fact, this line of hens had some other, rather less desirable qualities. They presented signs of aggression, violence, dysfunction and waste. There was an extremely high prevalence of fatal cannibalistic pecking within the group and general agonistic behaviors. Those in the cage who did not die from these cannibalistic attacks (there was an 89% mortality rate) were left with severe feather loss, life-threatening abrasions and other serious physical injuries. The hens were more intent on fighting amongst each other than doing anything productive! Hopefully that doesn’t sound like any workplaces you know…
So what happened? Why did the best egg-layers from the first generation yield something akin to the Gremlins of the eponymously named 80s movie? What Muir realized was that instead of identifying the most efficient hens, he had identified the hens that successfully conveyed the appearance of being the most productive. Those hens that individually produced the most did so by being adept at aggressively suppressing the other hens from laying eggs
. Taking the more productive individuals meant taking the more aggressive hens. Breeding repeatedly from those which were most productive actually favored those which were most aggressive. Placing these hens together in cages led to extreme violence (only three of these psychotic hens actually survived!). Muir ended up running out of the Super-Chickens and had no choice but to end monitoring them and only continue with the other group. Ultimately, the process of selecting at the individual level took to an extreme the challenge of cooperation arising from individuals selected for selfishness.
The behaviour of the psychotic hens fits rather well with the normative assumptions of classical economic and game theory, which suggest that individuals will act selfishly in situations that afford them the opportunity. In group situations, individuals are consistently expected to identify, and act on, the dominant Nash strategy—the strategy that cannot be beaten. Just think of the classic ‘tragedy of the commons’, where people are predicted to free-ride on and exploit the contributions of others to a shared resource. Furthermore, the selfish actions of the Super-Chickens also support the theme of much evolutionary psychology from the 1960’s, which was based on the principle that individual interests will always outweigh the interests of the group.Given an opportunity to benefit from the efforts of others, selection will favor those which seize the day.
Some companies have begun to pay heed. Recently, Microsoft abandoned its longstanding stack-ranking approach. It recognized that stack-ranking was undermining team cooperation, employees withheld information to avoid damaging their own rank, sought teams where they could rank better, and ensured new team members failed. As an outcome to stack-ranking, it seems obvious. Yet many companies pursued it, just as breeders choose super-chickens. For Jeff Bezos, he may not agree. Amazon is a hugely successful company, at least in sales and turnover. It is not a particularly profitable company. When Microsoft was the behemoth of its domain, its aggressive policies eventually led it into trouble, barely avoiding being broken apart. Enron thought it had the smartest guys in the room. It’s endemic corruption ultimately crumbled the company. A company led by super-chickens may not be the best long-term strategy.
They are selecting for narcissistic sociopaths in their organization, and in the long run that is not a good thing.