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Comment by TeMPOraL | Hacker News Reader

> If you create a community like Microsoft's four years ago in which for every team, the "least qualified"(even if all of them are great) is fired, you create a culture of threat and terror, and people are going to protect their selves.

The other side of the very same coin is when you award top X% people for performance. When you fix the reward/punishment pool, people have much less incentive to work together, because every help you give to someone else is reducing your own chance of success.

I'm not sure why people set up such incentive structures. Is it greed? Or some kind of stupid belief that a little bit of competition will help? Yes, if you let every good performer get a bonus regardless of how many others are also getting it you'll have to pay out a lot of bonuses, because you'll have a lot of good performers. But isn't it exactly what you want to have?

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"I'm not sure why people set up such incentive structures. Is it greed?"

I think it comes down to managerial laziness and social discomfort. Giving someone a bad performance review or dealing with poor performance is inherently an uncomfortable social interaction. Once a manager acknowledges that someone isn't meeting standards organizations usually have a process by which they need to help that person improve or eventually fire them which is a lot of extra work for that manager.

In other words it is a way to force managers into dealing with bad employees instead of letting problems fester.

I recently watched an interesting video of an austrian economy professor, who came to the conclusion that our current competition based society is in effect because in the past competition was crucial to survive, and thus people competed. Our current generation competes because we grew up in a competitive society and in order to be truly cooperative, cooperation needs to become a part of our "memes". Here's the video, unfortunately in German and no subtitles are available yet: http://www.youtube.com/watch?v=Oouoee9UvEc.

I think the main problem with group bonuses is that those who know/think they worked harder will feel treated unfairly. I have no information on how group bonuses are perceived or what their effects are. However, I personally think that the main problems come from teams who don't share the same spirit/culture and thus, those problems also exist in individually rewarded teams.

"I think the main problem with group bonuses is that those who know/think they worked harder will feel treated unfairly."

Individual bonuses, if they befall the wrong individuals or are percieved to be unjust can destroy the will of the entire group or organization. I would claim that for expert organizations the risks of individual rewards outweight any benefits they may have. Group bonuses or company wide profit sharing spread general goodwill. Continuous performance is what counts in the long run. Continuous performers will get their reward in the form of raises or promotion. In theory, at least. Note: I'm from an egalitarian nordic country, culture probably affects my perception.

I'm from Germany and bonuses and wages are something we don't talk about with many people, let alone colleagues. I even had a paragraph in my last working contracts that forbade me to do so.

I've been thinking about the same thing! It's a pity the video is in German.

I came to the conclusion that at a societal level, competition is almost always harmful as soon as it's outside the confines of a game (i.e. when people stand to win or lose something tangible from it).

I believe it makes all large organisations extremely inefficient and dysfunctional. As another example, it results in a lot of redundancy in the context of R&D.

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