How bad performance management killed Microsoft's edge article from 2012

Vanity Fair‘s August issue includes a feature article about Microsoft, written by Kurt Eichenwald, that lays the blame for the tech giant’s decline firmly at the feet of its bureaucracy, and in particular its awful system of performance management.

What went wrong? Microsoft has been crippled by a management system known as “stack ranking.” Like the hated bell curve of your high school memory, this program forced each business area to rank a certain percentage of employees as top, good, average, or poor performers. That means that even if your department was full of stars, a certain quota would be getting bad reviews—no matter how hard they worked. Pretty demoralizing.

He’s a quote from the preview of the article that’s now available online:

“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,” 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.”

This sort of cannibalistic performance management practice—with its rigid, stratified winner’s circle—completely disengaged many workers at the company, and led to a culture that did not encourage cooperation or teamwork. Innovation and excellence fell victim to the need to compete with co-workers for not only recognition but survival. Said one former employee: “It was always much less about how I could become a better engineer and much more about my need to improve my visibility among other managers.”

Microsoft, once the uncontested king of the tech industry, has faltered while companies like Facebook, Apple and Google have excelled. Where Microsoft had a head start on technologies like smart phones, social networking and e-reader tablets, in every case the company’s culture, which penalized risk-taking, caused them to fail.

Good talent management is not divisive; it is inclusive. It takes into account the viewpoints of peers; it doesn’t pit you against peers. It is flexible and immediate and responsive to the needs of management and the needs of workers. It works in tandem with the culture you want to encourage; it does not set up a new, toxic culture.

The surest way to kill your company is to ignore these principles.

Don't cover vacancies and ensure you are working to your terms of reference from 22 May 2013

In the last fortnight we have asked members to work their proper hours, work to their proper grade and take their proper breaks. This campaigning work and largely non-financial industrial action has gained momentum and is striking a chord with members.

Our union has now announced a one-day strike in the Ministry of Defence on Wednesday 29 May and from a week before this date, we are asking members not to cover vacancies and to work to their terms of reference from Wednesday 22 May. With tens of thousands of vacancies, both civilian and military, across the Ministry of Defence, this will now add further pressure on the department.

Background

Whilst defence sector members have healthily endorsed our union’s Fair Deal campaign; the same cannot be said about MoD management.

Since the campaign launch in May 2012, we have attempted to reach agreement with the department on the way forward for civilian workers in the Ministry of Defence.

After a year of negotiations, we are sorry to report that we are not making much headway. Despite believing in March this year (when we postponed our original work to rule industrial action) that we were making progress, it proved to be a false dawn.

At that point in March, the department gave us a draft enabling agreement. Unfortunately this draft agreement was not worth the paper it was written on and despite regular meetings since then, the department are not willing to move on the substantive issues such as job security and privatisation. We cannot even get agreement that MoD employees should not be out of pocket when undertaking departmental duties!

Industrial action

Because we can’t get agreement with the department that will give those remaining in the MoD a Fair Deal and because coalition ministers are still refusing to meet our union at national level, we have to step up the action we are taking to fight to get our campaign objectives enforced.

Our incrementally increasing “work to rule” started with ‘Working your proper hours’ on 7 May and moved on to ‘Work to your substantive grade and take proper breaks’ on 13 May. We are now asking members to add to this by refusing to cover vacancies and work to their terms of reference across the Ministry of Defence from 20 May.

What we want you to do

Since the SDSR announcement in October 2010, more than 24,000 civilians have left the department in one guise or another. The corresponding workloads for these staff have by and large remained. Our union has seen little or no evidence of work disappearing or tasking changing and the wide-ranging anecdotal evidence we have gathered from members is that out of loyalty to our military colleagues, we are still completing this work.

Much of this is working at a higher grade but still only being paid for the substantive grade. Not only are members being financially penalised by not being paid the correct rate for the job, we are simply plugging the gaps left by colleagues who have had enough.

Similarly, doing a favour for the department by covering for members who have left who were the same or a lower grade is also covering the gaps, but this is also ensuring the department is not facing its responsibility in ensuring we have the best possible support to the front line. To do so, we must have a fully staffed department with no long-term vacancies.

Our union is now asking that members stop doing the work of posts that are declared vacant. It may be as little as doing your own photocopying, but even doing relatively simple administrative tasks such as this is part of the problem that the MoD and the government have caused.

When recruited into post all members should have been provided with a job description (or Terms of Reference) laying out the duties of the post; these are supplemented by the tasks outlined in individuals Personal Assessment Reports (PARs). Given the massive change programmes undertaken over recent years and the corresponding post mapping exercises members have endured, these may well have been updated subsequently. If you are unsure of your current ToRs ask your line manager for a copy.

Additionally, more and more work places are now issuing desk instructions to staff in an attempt to standardise routine tasks. It is the experience of many PCS members, however, that these are highly aspirational, and do not reflect the reality of massively increased workloads, and the short cuts that are required to meet them. They exist more to protect managers by shifting the blame for process failures onto lower grade workers, than to meet a genuine business need.

Finally, MoD civil servants have access to a number of entitlements, some generic and some specific to particular pay bands or grades. Special paid leave to cover medical appointments unavoidably in works time is an example of a generic entitlement, whilst first class travel for pay bands C2 and above is an example of one linked to pay band.

As part of this stage of our industrial action strategy we are asking all members to work strictly to their job descriptions and desk instructions, as well as insisting that their entitlements are honoured. Do not carry out duties that are not listed in your ToRs and/or PAR; after all any other tasks have not been formally agreed with the business and are distracting you from getting your job done. Additionally, we are asking that you rigidly follow any and all written instructions regarding how to complete a task. For example, if you are required to obtain authorisation before proceeding from one step of a task to another do not proceed with this task until the authorisation has been obtained. It goes without saying that a hard copy record of this authorisation will be required.

We also ask that you demand that all appropriate entitlements are honoured by management. Your local PCS representative will be happy to assist you with this if required. Don't forget to check the Personnel Policy Instructions (formally Policy, Rules and Guidance) to confirm these entitlements. You are, of course, entitled to do this in works time. Should management refuse to meet your reasonable demands we encourage you to raise a grievance that departmental policy is not being followed; again your local representative will be able to assist with this if required.

Conclusion

Senior MoD management and coalition government ministers have taken our loyalty and abused it with years of pay restraint and attack after attack on our pensions. Now, they seem determined to race our terms and conditions to the bottom.

We now have two choices:

1. We can say and do nothing. This will give a green light to years if not decades of further suffering where pay continues below inflation; where pensions are decimated even further and where the right to work flexibly, the right to paid sick leave and many more terms and conditions are a thing of the past.
2. We can stand up now and take action. According to the Guardian website, this coalition government has already U turned on 37 original decisions. It is time to continue our action to ensure this number rises yet again.

Our union believes it is time to take that stand and to take further action. By not covering vacancies; by working your proper hours at only your substantive grade will make the department and ministers listen and give you a Fair Deal in Defence.

DSG 29 May action briefing 1 - All Out On 29 May

As part of our Fair Deal in Defence campaign that is intertwined with the PCS national campaign to safeguard pay, pensions, terms and conditions, PCS Defence Sector members will take one-day strike action on Wednesday 29 May.

Our union’s general secretary, Mark Serwotka, rallied members when announcing this further wave of group action at this year's conference in Brighton. Mark praised the "magnificent" contribution members have made in the Budget Day strikes and rolling programme of group action, saying: "Our range of tactics have so far been very effective, demonstrated in efforts management have tried to make to disrupt our action."

Mark continued by talking about a 16% cut in members’ living standards over the last five years, at least another two years of a 1% pay policy in the pipeline, an unprecedented number of job cuts in the public sector, privatisation, closures, attacks on terms and conditions and pensions,

Giving up is not an option

In his opening speech at national conference, Mark said, “"This government believes it can carry on doing what it's doing without anyone stopping it. It's not going to stop unless we stop it."

"Because giving up will condemn our members and people who use our services to years and years of misery we will never get back if the government gets away with it," he said.

"With our national one day strikes, regional rolling strikes and short-term disruption we are giving it a real go and catching the employer on the back foot with our tactics. But our challenge now is to deliver a campaign that gets Francis Maude off his arse and around the negotiating table. We are in the battle of our lives but now we have to dig deep.”

Mark concluded by saying, “We need to step up our campaigning and organising and deliver our alternative. We must show real commitment and carry on fighting."

Conclusion

In the Ministry of Defence 24,000+ staff have left in little over two years. Nobody, whether it be defence ministers, senior MoD management, PCS reps or PCS members has been able to give any detail as to how the loss of these staff has been balanced by a corresponding reduction in defence outputs.

For those remaining – the survivors – the reward is attack after attack on their loyalty:

• Pay frozen for two years and now indefinitely set at rates below inflation – in other words, continuous pay cuts.
• Two pension contribution increases already with more to follow. The ‘reward’ – work longer and get less.
• Threat after threat to our terms and conditions. It has started with flexible working for new starters; if we don’t make a stand it will be attacks on flexible working for all employees, attacks on leave entitlements, attacks on sickness absence limits and many more.

Government ministers refuse to talk to our union nationally and we are treated with contempt in the MoD as we try and get a Fair deal in Defence. We now need to take strike action so that we can give every member a Fair Deal in Defence.