Dear Friends,
It seems to me, every human interaction has an element of politics, and as such, political favor as well. Which goes a long way to explaining the Pareto distribution. Where upwards of 80% of managers provide negative equity to the company. I posit that’s because they advanced through political favor instead of merit. Those who merit advancement often don’t get it because of politics. Who loves the guy who produces twice what everyone else does? He makes everyone else look bad as he forces them to work harder. Thus he loses political favor with his coworkers. Who run him down to the boss. Driving down the meritorious’ political favor with the company as well. Meanwhile, the layabout who doesn’t ruffle any feathers, gets the promotion. Who then provides more negative equity to the company.
Political favor is the currency of human interactions. Those who have great wealth in political favor are sought out. Some seek them for the political favor that’ll rub off, by being associated with the politically favored. Others might want to trade on political favor… for favors. Still others might simply be mesmerized by the glitter of all the political favor. Think about it. Would you like to hang out with some celebrities? It’s in our nature to be drawn to the politically favored. Whether that favor came from actual politics, wealth, charisma or being in a rock band. Moreover, the Pareto distribution applies to political favor as well as wealth, traffic and sewage. Which means that those with political favor have a ready way to bypass closed doors. The Noticeable Ones… so to speak.
Companies need good workers who merit promotions not politically favored ones. Despite the many tools corporations use to weed out layabouts… political favor always provides a back door. The same attributes that got the layabout in the door then puts the ladder in front of her so she can climb it. She doesn’t work hard so she doesn’t make anyone look bad. So she has no enemies among the workers. As she schmoozes management. So she climbs the ladder in place of those who merit it. You may ask yourself why would executives fall for this trick? I think it’s because appearances are reality to a human being. We all think what we see is reality. Despite the optical illusions that amused us as kids. So we’ll promote the candidate that appears to be the best… not the one who is best.
In this businesses are tricked by their basic tendencies. The tools are insufficient for the job. Because of human nature. There’s a story about when Steve Jobs came back to Apple. The company was on the ropes and the executives needed a scapegoat. So they brought him back after pushing him out. Upon touring the company Mr Job’s asked about a guy in a corner working by himself. He was told the guy was a nutcase, his ideas were crazy, and he was about get fired. So Mr Jobs asked the guy what he was up to. The oddball showed the new CEO a crazy colored single box PC. After seeing what the guy was up to, Steve Jobs patted him on the back and said, We’re going to make millions. Then did. Saving Apple from bankruptcy. Because Steve Jobs recognized merit through the glitter of political favor.
This intractable problem might be solved with corporate culture. A culture that seeks out and rewards merit. It’s harder than it appears. Because, merit can be hidden, while political favor passes as counterfeit merit. Many executives have come up with thousands of algorithms to find merit… but they failed. The Pareto distribution is ruthless. In only a few firms does this trend break down. Space X might be an example. But I bet even in that innovative and merit seeking firm, the distribution of people that provide negative return is no lower than 60%. That small advantage, 80-60% amounts to a giant leap in productivity, and innovation. Making their culture one to emulate and improve upon. Maybe the trick is finding people, capable of recognizing merit, through the sparkle of political favor?
Sincerely,
John Pepin
