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"The guy that produces 10x the normal amount of production for his job isn't having his pay thwarted by any "sociopaths""

While it suits the company to identify and retain the productive, management's incentive is to minimally reward producers.

Productive losers are, by definition, not those who will take a risk to ensure maximal compensation. Their wages are therefore easy pickings for a sociopath manager who is willing to take risks to ensure their own maximal compensation.

The author has simply assumed that at some point any budget will cross a sociopath's desk, thereby guaranteeing the productive loser's compensation will be depressed in the sociopath's self-interest.




Have you managed or employed people? I ask because paying people well is a bit counterintuitive , but most owners and managers figure it out pretty quickly. Paying more than minimally typically increases morale, loyalty, and retention.

Sometimes you wind up working for an oblivious or sociopathic boss - but then you need to go apply for another job elsewhere. It's like if the closest restaurant to your house is no good: You ought to take the effort to get out of there, and that is your responsibility.

But generally speaking, even halfway decent managers and owners go out of their way to compensate their best people. Now, low-middle managers are not always halfway decent, but then, they're probably not getting directly compensated on production either. Once you get to "head of division", "head of region", and any ownership role or incentive based on real production from a manager's unit, you're going to get managers that want to pay their people well. It makes a bigger pie, so to speak.


Wages are a hygiene issue: people will quit over low wages, but high wages rarely encourages morale, loyalty, or retention. (Herzberg)

Instead, autonomy, complexity, and achievement, and recognition are related to motivation. I'd rather make $80k a year doing something I love than $95k a year doing something I hate (assuming that $80k is enough to meet my living expenses and other hygiene needs).

http://www.netmba.com/mgmt/ob/motivation/herzberg/ for a brief overview.


In large organizations, the managers themselves don't decide on their employees' compensation-- HR or executive committees do. Their mandate is to compensate minimally, and they are disconnected from the actual performance of the employee and thus has only their self-interest and political considerations (whose department got the last raise and for how much?) to take into account.


HR's bonus, tho' is calculated on metrics like staff turnover.


Like the other reply said, not every organization does bonuses. My BigCorp, being in retail, only does bonuses as profit-sharing, based on total company performance.

Job performance objectives are overwhelmingly based on overall company performance and department-level performance scores, and individual performance has almost nothing to do with it. And even then the whole salary situation is cloaked in smoke and mirrors and is essentially irrational and adversarial. Your scorecard numbers have nothing to do with it.


But if HR doesn't get any bonuses, then they really have no incentive to do a good job at all. You would then just need to do enough work so as not go get fired.

I work in an organization that fits your parent's description and it sucks. HR doesn't do anything except administrative work and the departmental managers don't have any authority in regards to salaries and benefits.


The other (very good) responses cover relevant ground, but I wanted to address one additional point:

"Sometimes you wind up working for an oblivious or sociopathic boss - but then you need to go apply for another job elsewhere."

The author's term 'productive loser' is defined by the unwillingness to accept risk to ensure maximal compensation. If you agree that the willingness to take such risks is required, I'm not sure that you're truly at odds with the author's original statement.

Further, your 'upper management' examples all live at the 'sociopath' level of the author's corporate pyramid. Sociopaths are eager to pay other talented sociopaths fairly, because they know that they must.




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