I formerly worked for a company that for a few years referred to all of the engineers as "rock stars" etc. As the company matured a bit, that was dropped from all of the top-down type communication.
The company didn't actually value the employees any less, and we were still praised appropriately for good work and / or solid efforts. The issue was that people simply had to acknowledge that no, not all of the engineers put in the same level of effort or had the same natural talents, and pay disparities couldn't make sense when "everyone is a rock star programmer".
Granted, by the time i had left, we only had 3 or 4 pay bands from most junior to highest job title that still programmed, but the company wasn't in the west coast and didn't pay west coast salary either, so the actual compensation gradient was narrower than what you might find at a FAANG company.
In large orgs, there are so many positions that are important but have unclear or many levels removed from impact (HR, audit, sanitation).
I've also encountered many people who aren't motivated by the mission, but rather have other motivating factors outside of work and still want to progress. I think having some systematic way to include and grow people who don't have natural motivation for impact is important, for large orgs.
That’s why in the regular army you don’t see 50 year old Captains.
For example if you join the Army as a specialist (E4) you have 8 years to get promoted or you’re essentially kicked out.
Though I would think for enlisted this happens much less than officers.
Junior/Normal/senior is a change in rank or function. It makes sense to provide salary steps with respect to tenure, but not changes in duties.
I'm considered "senior" but the work in the last half of my career has certainly been more intense than the first half. Sometimes I think it'd be nice to go "back" a few steps to a job that I'm certainly very comfortable doing without too much effort and get paid decently well.
I worked at a place with long tenured people who stick around forever. Worked great and saved money, but when they retired the business was pretty screwed.
You always have to bet on management being long term dumb, so processes need to be setup to maximize short term risk for management. No modern manager gives a shit about a high impact risk 5 years from now; if you’re lucky they may care about next year.