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Microsoft's 'Cannibalistic Culture'
theodp writes "In the provocatively titled Microsoft's Downfall: Inside the Executive E-mails and Cannibalistic Culture That Felled a Tech Giant, Vanity Fair offers a teaser for a story that will appear in its August issue on Microsoft's Lost Decade, which promises an unprecedented view of life inside Microsoft during the reign of Steve Ballmer. 'Every current and former Microsoft employee I interviewed — every one — cited stack ranking as the most destructive process inside of Microsoft, something that drove out untold numbers of employees,' contributing editor Karl Eichenwald writes. 'If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, 2 people were going to get a great review, 7 were going to get mediocre reviews, and 1 was going to get a terrible review,' says a former software developer. 'It leads to employees focusing on competing with each other rather than competing with other companies.' Also discussed is the company's loyalty to Windows and Office, which induced a myopia that repeatedly kept Microsoft from jumping on emerging technologies like e-readers and other technology that was effective for consumers. Having seen an advance copy of the full piece, GeekWire offers its take on what it calls an 'epic, accurate and not entirely fair' tale."
That may be the mother of misleading book titles. Microsoft has lost a step in some areas (as much due to Apple's ascendence as anything MS did wrong), but this sounds like one of those apocalyptic books you see about finance ("The Coming Great Depression" and stuff like that). It's essentially a tabloid headline on a book cover.
Life is hard, and the world is cruel
Every year for over a decade I've seen Slashdot posts about how Microsoft is doomed and that Microsoft is already irrelevant and failing. ...and yet, every year when the tech companies report their earnings Microsoft will put up big numbers that are bigger than last year's. Thus, every year they can accurately claim to have made a "record" amount of money.
I should be so lucky as to "fall" as hard as Microsoft.
...and it has the same results. Law schools grade this way. It simply adds a very real incentive to undermine those in your group. It forces competing against one another for individual gain, often to the detriment of group progress.
It sort of makes sense for law students whose focus will be litigation, since they are training for an adversarial environment. It also ensures that the lowest performers are consistently swept out.
However it rests on the assumption that the lowest performers are necessarily and always detrimental to a group overall. This of course isn't true, since every single group will have a highest and a lowest performer. The other downside is of course that it promotes individual interests over group interests.
MS has always hired some of the best and brightest, but for years the output has been unable to match. So if you have top people, but you can't produce stuff people want than what is the issue? Management. Duh. I know, and I'm sure many others do too plenty of smart people in the biz. The difference between the Apple, Google, and MS guys is slim at best. But what gets produced is obviously not favorable to MS in quality or innovation. Innovation to Balmer seems too "out of box" and scary to be worth it, so instead he comes late to every. single. party. in the last 10 years.
They had very similar performance reviews at Enron
We had something like this where I worked for a couple of years. It's gone now (at least, nobody talks about it), everyone hated it from the middle managers on down. It was based on the "lifeboat", which they mention briefly in the article. The term I got from the article "learned helplessness" is so perfect I wished I'd known it when this was going on.
The first year they ranked everyone in the same "grade" together. If your manager tried to do what HR said and rank people then there would be a few other managers who said everyone on their team was perfect, and therefore you'd get pushed to the bottom of the list for raises. Also, unpopular or inexperienced managers would get their entire team screwed.
The second year it was just among members of your team but the managers HAD to have some percentage who sucked (who would get the ranking you were normally given before you got fired). It didn't matter if that person was productive or not... their thinking was every team must have a slacker who can be fired. Small teams were the worst off here.
HR sucks everywhere.
Sounds like Gates rejecting the eReader (because it didn't look like Windows) didn't help things either.
As a former Microsoft exec, my observation was that most blue badges above level 62 spent 30% of their time on work and 70% of their time maneuvering
They'd be foolish not to be loyal to windows and office. Those were/are two fabulously successful products.
I think there is a strong case for MS ignoring any options for broadening their product range, and just focussing on their existing winners.
This concept was foisted upon the world by former GE CEO Jack Welsh. It has ruined one company after another and is an example of the cure being worse than the disease. Watch out when your company hires in HR people from places like GE, IBM, Microsoft, Nortel, AT&T, etc.. They will try to get a promotion by implementing a slightly different version of this which will have about the same results.
Wansu, th' chinese sailor
A summary of an article about a story about an as-yet-unpublished article.
What a wonderful world.
You are welcome on my lawn.
We had the same at HP - if you got the bottom ranking twice in a row you were asked to leave. We had a stable team of 10 engineers, all of which were good at their job but one had to be ranked as incompetent.
We working through the list alphabetically, so everybody got it once in a while but never twice in a row.
Let the ranting begin!
where would he be? Hmm????
You have not met many employees then.
It was great for five years or so, then the third generation of this family-owned started flexing their muscles, invoking a new unsaid policy that unless you could prove otherwise, the assumption was that you were a lazy goof-off who should be demoted or fired.
Thus was born the semiannual evaluations from hell process.
I would typically spend 20-40 hours applying loads of manure to my evaluation in an effort to be spared the axe. So would every other salaried employee in the billion-dollar company. This was time that could have been used in improving our production numbers via technology (I was an intranet developer). Instead, we had to slather our way though an incomprehensible eval process that forced us to make predictions based on absolutely no data. Basically, we had to try to read the minds of a couple of dysfunctional family members who now found themselves in officer positions.
They probably couldn't get warehouse worker jobs for Wal-Mart, thank God (for them) that they were members of the family.
I've been gone about a year now, others are going over the wall as other jobs make themselves available. The company has managed to grow in a bad economy, but when things get better, I predict a Microsoft-like turn for the worse, as folks who can afford Hostess or Dolly Madison snack cakes leave in droves.
I'm not saying that the psychotic salaried evals are causing the downfall of the company, but they certainly are a barometer of how things in general are going. Just like Microsoft.
According to Wikipedia: Decimation (Latin: decimatio; decem = "ten") was a form of military discipline used by officers in the Roman Army to punish mutinous or cowardly soldiers. The word decimation is derived from Latin meaning "removal of a tenth".[1] A unit selected for punishment by decimation was divided into groups of ten; each group drew lots (Sortition), and the soldier on whom the lot fell was executed by his nine comrades, often by stoning or clubbing
OK a valid if harsh form of management, but note the critical distinction that the Romans reserved this very harsh technique for unusual events. They were not dumb enough to do this to every unit on a routine basis!
any job with metrics / review where someone has to get a poor review all suck and if you want to see how bad it can get look at best buy, circuit city, staples and others to see where that get's you.
Or teaching for that matter. All employers are doing this now and the MBAs love them. Maybe I am cynical but the strong demand for results really is the result of all this downsizing and restructuring.
http://saveie6.com/
The stack ranking wouldn't be a destructive process, if management used it correctly. It should be a template on where the team member is placed because they perform at a certain level of execution. Not a tool to make sure the list has a certain amount of 1s, 2s, ... 5s.
On my team there are employees who are there to collect a paycheck and coast; they deserve lower rankings because of their mediocre to poor performance. We have guys that do what they are told (and that's it), they get average reviews (3s). Sounds about right? It does work there. We also have politically savvy individuals that deliver nothing and guys that actually perform and do a lot of work. Guess who gets the higher numbers? Management claims it's not political; to the point where they have to have HR in the room to ensure it's not political. It doesn't, hasn't and never will work. (It really burns me when someone with a bunch of hot hair gets a 1; when you work your tail off and get a 2...)
The example given, 10 employees, and only 2 with awesome reviews creates a competitive atmosphere. Management is always on the look out for faults in an employee that have been used for years against someone. It kills moral, makes people self-pontificate way to much (and say nothing) while doing little to self promote how great they are. If they used the number system as a template to rank employees and not force a bell curve, Microsoft would have happier and more innovative employees.
Your odds of surviving thirty years of this is approximately zero. Everybody has an off year eventually. Once people realize that, their commitment also goes to zero.
Help stamp out iliturcy.
When using a review system like this, few things are more valuable to a manager than some really terrible employees.
Imagine I have 2 amazing developers in my team and 3 very good ones, and the ranking system is going to force me to give one a bad review: It will not only make that one very good developer mad, but sour things for the other two, that have to keep beating the poor sob I randomly chose as the one getting the bad review. However, what if I transfer one of my very good developers to a different team in exchange for a worthless chump? Give the chump nothing important to do, and then the rest of your team can continue unhindered and unafraid of getting an awful review just because they are associated with a competitive team.
I used to work at a place like this. If a new hire was just way too good, he was moved to a different team that had lost a top performer, and team quality was kept relatively even: We had to protect the good developers we had. Any team that was too good just had to be split up, or they'd quit anyway.
Unless they are looking to move as many people over as possible in as short of a time as possible. XP was a good OS. There are still plenty of people dedicated to continuing to run it. I myself have 2 computers and 2 VM that I still have on XP. If 8 doesn't completely blow, I will seriously consider upgrading the VMs to Windows 8, and if the XP machines hardware will run it, I might just upgrade them as well. XP is comming to it's end of life. The fewer people still on it on the EOL date, the less complaining about MS we will hear.
Then I have to ask (since I haven't seen the price that OEMs pay for 8. or 7 for that matter), Is the price of 8 20% less, or is MS just bringing the retail price of Windows closer in line with the OEM prices?
Monkeyboy.
When all you have is a hammer, every problem starts to look like a thumb.
also managers who don't know what they are managing also drive stuff like that. You can take a good manager and put as the head of a group that then have no idea on what they do / how they work and they can fail.
In sports most team managers are former players so they know how things work.
But somehow it just works here. This is probably because we rely heavily on peer feedback and tractable facts about employee performance (i.e. what the employee has actually done, as expressed in launched products, features, changelists, design docs and so on). And engineers participate in perf reviews to a much greater extent. And the lowest ranked person doesn't have to be fired, because as a rule Google's lowest ranked employees would often be superstars just about anywhere else.
MS review process, on the other hand, makes one feel that no matter what you do, you're going to get reamed in the ass anyway. And if you do well, it's often arbitrary and unexpected. I did not expect three out of my five promotions there, and was passed over for a promo once simply because I brought up some uncomfortable truths which made the product unit manager (PUM in MS lingo) look like a fool.
Disclaimer: I do currently work for Google (3 years), and I have previously worked for Microsoft for nearly a decade.
See that's just it, the PC market is half as much an albatross as it is a cash cow - MS really *can't* abandon the PC market, because for better or worse through all their OEM deals, they made it. If they ditch PC's to become the Zune of Mobile, they'll croak and we'll see chaos that hasn't been seen since 1985 with some 7 vendors fighting it out.
That would cause *billions* of conversion damage.
My first Journal Entry ever, in 8 years! http://slashdot.org/journal/365947/aphelion-scifi-fantasy-horror-poetry-webzine
It'd be awesome for people working in IT... new IT boom.
Mod me down, my New Earth Global Warmingist friends!
I was envisioning more of a scenario where the PC market itself disappears into cloud services and tablets sort of thing, where the platform you're running on the device is secondary to the web standards and big kid server stuff on the backend. In that case I suppose I was sloppy in my use of language, it's not so much MS giving up the desktop business as the desktop business bypassing windows entirely, and MS being forced into some other kind of company.
The military uses a system very close to this. The most common evals give are EP (Early Promote, the best), MP (Must Promote, the one nearly everyone gets) and P (Promotable). But as we're locked in contracts and it's quite hard to get fired, the number one thing commanding officers are graded upon is retention. So what happens when you've got a very high performer who makes it known he won't be reenlisting? He'll be given that MP or dreaded P. What happens to that fuckup who swears he loves the Navy and will reenlist? He gets that EP no matter what.
Rather than being a system which rewards the most able, it only entrenches more anger and dissatisfaction with this false meritocracy.
Well Circuit City tried the rank the sales staff from 1 to 10 with 10 being best and fire all the 7, 8, 9, and 10 employees. That seems to kill your business in 90 days.
Work bio at MMWD
Instead of failing to meet an objective standard, this is forced quota system.
Except for ending slavery, the Nazis, communism, & securing American independence, war has never solved anything.
My manager at a defense contractor that used the forced ranking system wanted something akin to the IRS's EZ form. I know I'm going to get ranked Satisfactory, why do I have to wast 40 hours on this process?
Fortunately, managers were humane enough in doling out the bad rankings. If it was known an employee was retiring, that person would get the bad review.
Except for ending slavery, the Nazis, communism, & securing American independence, war has never solved anything.
To be fair to Microsoft, the "Cannibalistic Culture" is alive and well in many other corporations
However, this does not mean M$ does not suffer any damage because of it
I'll just take one example - Michael Abrash
http://en.wikipedia.org/wiki/Michael_Abrash
He is the author of the book "Zen of Assembly Language Volume 1" published in 1990.
Mr. Abrash worked for Microsoft, twice - and at both times, had come face to face with the cannibalistic culture inside Microsoft
FYI, Mr. Michael Abrash is not a run-of-the-mill programmer
This guy is a super top notch programmer
He could have contributed much more of his talent to M$ had the cannibalistic culture is not so prevalent there
Muchas Gracias, Señor Edward Snowden !
I also found myself on the losing end of a ratings battle at a past employer. The 'A' employees were rock stars, 'B' employees were above average, 'C' employees were just OK, and if you got rated 'D' -- better start looking for a new job, FAST. After three years of employment, good performance ratings and two healthy bonuses, my 'performance' started getting downgraded. I couldn't get a thing out of my team leader, who I thought I knew well, and could trust.
I worked harder after that, working through a three day weekend one time to fix a problem I'd caught, just to stay on schedule. Three months after my bogus 'poor' rating, I was called to a meeting where HR (whose job is to protect the *company*, kids -- keep that in mind) had a beautifully written warning ready that bore little resemblance to the truth.
I worked even harder after that, trying to pull out of the die that I appeared to be in, but to no avail -- I was out. I'm glad I'm not working there any more, but I left feeling a little insulted by the whole process. If you have to spend more time defending your job than actually working to perform your duties, isn't that messed up?
the PC market is half as much an albatross as it is a cash cow - MS really *can't* abandon the PC market
Albatross? I'd like that kind of "albatross". If the PC market doesn't tank, Microsoft keeps selling stuff; if it does tank, why would Microsoft continue with the OEMs? The second possibility is bad for Microsoft, but it could abandon the PC market.
Bingo, it was Steve Jobs ambition to BEAT Microsoft that lead to iPhone and iPad... because Microsoft was such a dominant king of such a very big hill.... with nothing for anybody else.
it took something really crazy and well plotted to get the masses to "go to another hill". That's why iPhone/iPad had to have DELIVERY so much better than anything out there. Go big or go home is all Microsoft left on the table. Meaning that when anybody got CLOSE to them a few years ago, they completely MISSED the threat... and are being gutted.
But who has to tell Ballmer that Steiner's force doesn't exist?
I left a company in the UK becuase of this. I put together a team selected from the top IT professionals in the company and all of whom got top reviews and pay hikes. When I reviewed them 12 months later I gave them all top marks but the HR dept said I could only put 2 at the top, 6 in the middle and 2 at the bottom. They just could not see why this was wrong and said it was Company Policy...this was not an IT specific company btw. Anyway after a fuss I left and so did 7 of the others when they found out what was going on.
and the mess when they finally do go down is going to be catastrophic for those industries.
Books like this are at least a warning to managers that putting all their eggs in a single basket might not be the best strategy.
All employee metrics that are not based on ownership of the case, are bad metrics.
I'm not going dive into what Microsoft has for employees, but if you're paying someone a salary, they should be responsible for X, Y and Z, no more no less. If Z is no longer something they want to do, find someone else to handle Z.
When you "stack rank", or base performance metrics on time metrics (eg calls per hour, short call handle time, short email responses, etc) you encourage employees to cheat. In call centers this means intentionally doing things that waste other employees time, or defer ownership of something to anyone but you. It's demoralizing because instead of working together, you as someone potentially on the receiving end of a stinker of a case, will do anything in your power to not take ownership of something someone was given.
When you pay someone an hourly wage, you're not valuing their experience. The only people that should be paid hourly wages are those that are doing non-skilled labor. Literately, if you hire someone off the street and train them, you can pay them an hourly wage. If you're poaching someone already trained or experienced in something, you pay them a fixed salary. You don't apply hourly metrics to someone on salary, because that in turn means they will have to cheat the metrics if you apply any punitive measures for not meeting them.
See Enron.
AJAX is just asynchronous calls brought to Javascript, HD in a console? i.e. they couldn't fully eliminate the HD from the computer they made into a console,
Scroll wheel on a mouse? Logitech trackball in a mouse 1983
http://www.google.com/patents/US4562347
Seriously, you're scraping the barrel to find anything you can interpret as invention, and its very similar to the comments scraping the barrel to make Ballmer sound like a good CEO.
Jack Welch of GE said "sack the bottom 10% of your workforce" not "sack 10% of each team whether successful or not", the winning teams must spend a lot of time infighting needlessly when they're winning. Ballmer is just raising the prices of products each year and it will kill Microsoft quicker than the competition will. He needs to be replaced sooner rather than later.
BALLMER is the bottom 10% that should be sacked.
Won't happen friend because the ISPs will just label screwing you on bandwidth "free speech" and good luck with being able to do squat in the cloud without bandwidth. to do what you are suggesting we'd need a good 40Mbps connection standard both ways, and there is very few places in the USA that are anywhere close to that. might work in parts of Asia, not planetwide.
ACs don't waste your time replying, your posts are never seen by me.
but there's little GROWTH in those markets anymore. Those are tired of getting constantly beat up to buy stuff they don't want or need just to make Microsoft's sales increases for the year. It's a great gig, but trying to FORCE your customers to buy 20% more every year isn't sustainable. For all that technology, Microsoft is more like American Standard... you know the guys that make sinks and toilets that are everywhere. Does anybody in the stock market CARE about toilet makers? Even if they did clear nice profits, they won't clear 20% growth numbers unless they have a wing dedicated to food poisoning and fiber sales.
A company that focuses on maintaining profit margin on established products acts much differently to attract sane investors. They focus on sustainable profits and getting things shipped on time, done right... their goal is to be as NOT FLASHY as possible because that is how the VAST MAJORITY of companies make their money, slow and steady like the tortoise not the hare.
In short, EVERYTHING Microsoft is doing is WRONG for their Enterprise customers.
50% of company employees will always perform below company median. This can not be changed. What can be achieved is 100% of employees being beyond industry-wide median. Once most of the engineers are beyond the best candidates available for hire company should stop stack ranking. The problem with candidates however is you never know how good they are.
MS revenue is anything but safe and Vista proved this. Windows 8 could be a complete and utter dud or even worse, people could decide Windows 7 suits them just fine even if Windows 9 reverses all the mistakes in 8. Hell, lots of people are still on XP.
There is also the recent ruling that software licenses can be sold on. Some company does go Windows 8? Lots of very cheap Windows 7 licenses available.
Same with office. An old version might just continue to be all you need. Buy an old license, it is not like software wears down or worse, go free after you realized that those employees that can't learn a new package are not employees worth having. Any case, if people can't move from office to libre, how will they handle a MS upgrade without the same amount of hassle? It is not like MS keeps its interfaces consistent over versions or anything.
Apple has shown just how volatile the tech market really is. iPhone destroyed two tech giants (Nokia and RIM) overnight and thanks to OSX and McBooks, all of sudden all MS offices are no longer what the boss with his shiny new iPenis insists on."Hey, you use linux right, maybe you can help me get my Apple laptop working on our infrastructure?" And another nail in MS coffin as now the Linux guy with all his free software and zero license cost and zero compliance cost is the one making sure the boss can use the tools he wants.
With a down economy, company owners, especially small companies are very open to save costs and very down on employees that refuge to change.
MS did well, so did Sun when the sky was blue and budgets were meant to be spent. Sun is dead, can Micro "Just add another server" Soft survive? Sure... they got lots of cash, they can afford to give things away. But not Office and Windows as they already use this to finance their other loss making projects.
That is MS biggest problem, it got a lot of revenue and profit but it is using it to fund to many things that never have and never will make a profit on their own.
Meanwhile Apple has got a shitload of income and nothing to spend it on. It has virtually no loss leaders. So even if the next project by Apple ends up a dud, they can take it. For MS it would be just another drain when they already got so many.
It is not impossible when you got lots of income to go bankrupt still if you just spend it even faster.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
What IBM? They are now almost entirely a consultancy company. The OLD IBM is gone. Atari also still exists, you can buy PC games from them. The name continues, the company dies.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
Mostly, stack ranking makes employees focus on butt kissing. Reviews are subjective so the manager's favorites get the good ranking regardless of actual performance or value to the company.
The last place I worked, we did peer reviews. Everyone ranked everyone else on their team. So butt kissing is detrimental because your co-workers may ding you for it. We had an outside consultant come in and conduct the reviews, so it would all remain anonymous. There were a few people that gave each other good reviews, but those "paired up" outlying reviews were easy to spot and were weeded out. Overall, I thought the process worked pretty well.
I spent a year supporting Exchange Server for business/premium customers. Unlike any other place I've worked, I've never had to double-check every suggestion I get to make sure it wasn't a way of sabotaging the repair. Also, if you make a mistake, your manager will throw you under the bus. I got let go for fixing a mysterious issue with a beta installation that was causing a loop in network traffic. Why was that a mistake? Because apparently fixing a problem in beta, even if you fully document the issue, is forbidden to the support guys. Only the beta team is allowed to actually fix a problem in a beta program, even if it is at 3 am and not a single fucking member of the beta team would answer repeated calls or pages (yes, we still used pagers back then).
But am I bitter about that? Well, yes, I kind of still am. Fuck Microsoft.
who prays for Satan? Who in 18 centuries has had the humanity to pray for the 1 sinner that needed it most? ~Mark Twain
What do other big name companies like Apple and Google do in place of stack ranking?
You are right: it needs to fail or be broken up. As does HP. In any pyramid management system, the layer above is frantically trying to keep down the layer below. Consultants develop clever schemes that are supposed to prevent this, but the vested interests are such that they get circumvented. The only answer is to remove the top layers of the pyramid, where the ossification is heaviest, and set the layers below adrift to sink or swim.
Of course this doesn't suit the stock market, the banks or the institutional investors, but I would have thought by now we would have realised that what is good for them is bad for the 99%. Germany's strength is that it has many, many middle sized companies run by people who are experts in their business. The USA used to have that.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Now IBM is basically back to being the old IBM - a company that makes unstoppable mainframes and markets a range of software and consultancy services around them.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Writing computer software and doing things in the computer business has a huge labour content. It has been really difficult (in the past) to figure out how long a software project would take. Projects have been repeatedly dumped because there have been volcanic explosions as new, startlingly cheap and stunningly attractive technologies have replaced the beautifully crafted heavy metal business machines and software of the last decades.
Stack ranking is an ugly way to force employee turnover.
So I propose what is going on at Microsoft is that Stack Ranking is Microsoft's way of forcing employee turnover. The business idea is "manage the company to reduce costs before the employee has a future interest or stake in the company".
There is a theme of love-it/hate-it between American big businesses and American workers. Consider General Motors. In the late 1950's General Motors began paying a pretty good wage to it's unionized labour force. By the 1990's the result was a lot of automobile workers that needed their benefits (working on an assembly line is physically demanding, over 20 years) and an entire manufacturing and marketing structure that spiraled downward when gasoline prices went past what was it ... $2 dollars a gallon?
The shifts in market are much faster in the computer software and hardware business. There is no union and no guarantee of continuing employment these days. So in this setting, labour is a commodity but what the labour produces is extremely difficult to measure. Into the fog of software and support Stack Ranking is not-unfair to the lucky 9/10 of the employees.
"There are no rock stars at Oracle".
Il n'y a pas de Planet B.
Demming's story in an interesting one, but unfortunately it has never been well understood here in the USA. Here we seem to think that 'blame' and 'scapegoats' are the best tools. It is really a shame.
"Can there be a Klein bottle that is an efficient and effective beer pitcher?"
Read Cringley on IBM. Winter is coming.
If you "read Cringley" on Apple, as an investor you would have been skewed.
I'd buy stock against Cringley's dire warnings any day of the week.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
This is going to be interesting. Samsung alone has more than enough resources to take on the entire Windows PC industry. The conversion is already happening. Ditching PCs may not be up to them.
Help stamp out iliturcy.
This is an interesting point that deserves more attention. Where are the trade and industry press? Why Vanity Fair?
Help stamp out iliturcy.