Previously in sequence: Moloch Hasn’t WonPerfect CompetitionImperfect CompetitionDoes Big Business Hate Your Family?

This post attempts to give a gears-level explanation of maze life as experienced by a middle manager in systems with many levels of management, as depicted in Moral Mazes. 

The ‘maze level’ of corporations differs wildly. These dynamics do not reliably fully take over until you have many levels of management. Questions of what causes high maze levels will be dealt with in future sections.

Again, if you have not yet done so, you are highly encouraged to read or review Quotes from Moral Mazes. I will not have the space here to even gloss over many important aspects.

An Immoral Maze can be modeled as a super-perfectly competitive job market for management material. All the principles of super-perfect competition are in play. The normal barriers to such competition have been stripped away. Too many ‘qualified’ managers compete for too few positions.

If an aspirant who does not devote everything they have, and visibly sacrifice all slack, towards success, they automatically fail. Those who do make such sacrifices mostly fail anyway, but some of them “succeed”. We’ll see later what success has in store for them.

 

The Lifestyle of a Middle Manager

At the managerial and professional levels, the road between work and life is usually open because it is difficult to refuse to use one’s influence, patronage, or power on behalf of another regular member of one’s social coterie. It therefore becomes important to choose one’s social colleagues with some care and, of course, know how to drop them should they fall out of organizational favor. (Moral Mazes, Location 884, Quote #117)

We have this idea that there is work and there is not-work, and once one leaves work one is engaged in not-work distinct from work. We also have this idea that there are things that are off limits even at work, like sexual harassment.

For a person without anyone reporting to them, who is ‘on the line’ in the book’s parlance, this can be sustained.

For those in middle management who want to succeed, that’s not how things work. Everything you are is on the table. You’d better be all-in. 

You will increasingly choose your friends to help you win. You will increasingly choose your hobbies, and what you eat, and your politics, and your house, and your church, and your spouse and how many kids you have, to help you win. And of course, you will choose your (lack of) morality.

In the end, you will sacrifice everything, and I mean everything, that you value, in any sense, to win.

If the job requires you to move, anywhere in the world, you’ll do it, dragging your nuclear family along and forcing all of you to leave behind everything and everyone you know. Otherwise, you’re just not serious about success. 

Slack will definitely not be a thing.

Your time is especially vulnerable.

Higher-level managers in all the corporations I studied commonly spend twelve to fourteen hours a day at the office. (Location 1156, Quote #120, Moral Mazes)

This is the result of total competition between producers – the managers are effectively rival producers trying to sell themselves as the product. 

The market for managers is seen, by those who make the decisions, as highly efficient.

If managers were seen as wildly different in terms of talent, intelligence, or some other ability that helped get things done, that would help a lot. You could afford to be a little quirky, to hold on to the things you value most, without losing the game entirely. Your success will be influenced by your personality and dedication, but nothing like solely determined by them.

Alas, the perception in these mazes is exactly the opposite.

See, once you are at a certain level of experience, the difference between a vice-president, an executive vice-president, and a general manager is negligible. It has relatively little to do with ability as such. People are all good at that level. They wouldn’t be there without that ability. So it has little to do with ability or with business experience and so on. All have similar levels of ability, drive, competence, and so on. What happens is that people perceive in others what they like—operating styles, lifestyles, personalities, ability to get along. Now these are all very subjective judgments. And what happens is that if a person in authority sees someone else’s guy as less competent than his own guy, well, he’ll always perceive him that way. And he’ll always pick—as a result—his own guy when the chance to do so comes up. (Location 1013, Quote #87, Moral Mazes)

It is known that most people ‘don’t have what it takes’ to be a manager. This is clearly true on many levels. Only one of them is a willingness to fully get with the program.

Once you get several levels up, the default assumption is that everyone is smart enough, and competent enough. That the object-level is a fully level playing field. The idea that someone can just be better at doing the actual job doesn’t parse for them.

All remaining differences are about negative selection, about how hard you want it and are willing to sacrifice everything, or about how well you play political games. Nor do they much care whether you succeed at your job, anyway.

Some additional supporting quotes on that follow. A large portion of the quotes reinforce this perspective. 

If you can’t work smart, work hard:

When asked who gets ahead, an executive vice-president at Weft Corporation says: The guys who want it [get ahead]. The guys who work. You can spot it in the first six months. They work hard, they come to work earlier, they leave later. They have suggestions at meetings. They come into a business and the business picks right up. They don’t go on coffee breaks down here [in the basement]. You see the parade of people going back and forth down here? There’s no reason for that. I never did that. If you need coffee, you can have it at your desk. Some people put in time and some people work. (Location 992, Quote 29, Moral Mazes)

But everyone at this level works hard, which was more about showing you work hard than the results of the work, because concrete outcomes don’t much matter:

As one manager says: “Personality spells success or failure, not what you do on the field.” (Location 1383, Quote 33, Moral Mazes)

It’s not like there were ever objective criteria:

Managers rarely speak of objective criteria for achieving success because once certain crucial points in one’s career are passed, success and failure seem to have little to do with one’s accomplishments. (Location 917, Quote 42, Moral Mazes)

Which makes sense, because if everyone is the same, then concrete outcomes are just luck:

Assuming a basic level of corporate resources and managerial know-how, real economic outcome is seen to depend on factors largely beyond organizational or personal control. (Location 1592, Quote 46, Moral Mazes)

I am supremely confident that this perspective is completely bonkers. There is huge differential between better and worse no matter how high up you go or how extreme your filters have already been. But what matters here is what the managers believe. Not what is true. Talent or brilliance won’t save you if no one believes it can exist. If noticed it will only backfire:

Striking, distinctive characteristics of any sort, in fact, are dangerous in the corporate world. One of the most damaging things, for instance, that can be said about a manager is that he is brilliant. This almost invariably signals a judgment that the person has publicly asserted his intelligence and is perceived as a threat to others. What good is a wizard who makes his colleagues and his customers uncomfortable? (Location 1173, Quote 88, Moral Mazes)

How do things get so bad? 

That’s the question we’ll look at an aspect of next post. From here I anticipate 3-5 day gaps between posts.

Questions that will be considered later, worth thinking about now, include: How does this persist? If things are so bad, why aren’t things way worse? Why haven’t these corporations fallen apart or been competed out of business? Given they haven’t, why hasn’t the entire economy collapsed? Why do regular people, aspirant managers and otherwise, still think of these manager positions as the ‘good jobs’ as opposed to picking up pitchforks and torches?

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in Moral Mazes there are at least 25 (!) levels of management

Exponential growth makes that implausible.

In the US military there are 25 ranks, but a hierarchy of half that depth with a branching factor of 3. Commissioned officer ranks correspond pretty well to the hierarchy, but there are only 3 levels of enlisted hierarchy below them.

You seem to be referring to this passage:

A weeding-out process takes place among the lower ranks of managers during the first several years of their experience. The early careers of promising young managers are highly variegated; the more promise managers show, the more probations they must undergo. Take, for example, the case of a young man newly graduated in 1965 from one of the South’s leading universities. He joined Weft Corporation and spent the next two years in the company’s production management training program. Then he became a first-line supervisor on the third shift at a small mill. Shortly thereafter, he was promoted to the night superintendent’s job of that mill and given overall responsibility for the night shift. After six months, he became a department head for weaving operations in another mill. After another six months, he was assigned to head a larger weaving department in yet another plant. After still another six months, he became assistant plant manager at a medium-sized mill and kept that job for four years. Then he moved to a still larger mill in the same capacity for another two years. Then he became plant manager of a medium-sized mill for two years. Finally, he was named one of two group managers with six plant managers reporting to him. At the age of 36, he has reached grade 20, the “breaking point” on a scale of 29, placing him in the top 12.17 percent of management in Weft Corporation with, he hopes, a clear shot at becoming vice-president of manufacturing. Similarly variegated careers are evident for young marketing and sales managers in Weft’s northern offices. In Alchemy Inc., whether in sales, marketing, manufacturing, or finance, the “breaking point” in the hierarchy is generally thought to be grade 13 out of 25 or the top 8.5 percent of management.

The low levels of these ranks probably provide for recognition of non-management employees, like the enlisted and warrant ranks in the US military. With a branching factor of 2, top 12% would mean 3 levels up from the bottom, not 20. With 9 levels above above 20, a total of 13 levels of managers. The other company, perhaps 15. But probably the top of the hierarchy is not actually 9 or 12 ranks, but sparser than they suggest, not as sparse as the lower ranks, but not completely full like the US military.

Yeah, wrote that too quickly. My brain didn't ever actually think there were 25 people reporting to each other, but in rush to clarify made a highly misleading claim. Sorry about that. Edited in OP to clarify that these are not levels of management.

Central point is the same that it's a very different magnitude of problem with 5+ levels versus 1-3 levels.

Have you seen this kind of stuff first hand? I mean, it sounds super pessimistic and maybe not 100% accurate - I know a fair number of managers who seem to have fulfilling lives.

I've worked in small tech companies, and in very large (but fairly young) companies. I know people in very traditional megacorps where dress code is still a thing. I'm sure there are segments and places as bad as described in Moral Mazes - people aren't lying when they describe this. And there are hints and lesser instances in all situations I've seen.

But none of my first- or second-hand experience matches this level of horror and denial of merit.

Yeah, same here. Maybe Zvi is talking about non-tech. But I'd really like to hear where he's getting this. Because if it's all from a book, well, books can exaggerate, or talk about a different time and place than ours.

This is a combination of (1) the book, (2) my personal experiences of various places including my attempt at running a business of my own, (3) my observations of what is going on in the world, (4) my interactions with major corporations when attempting to do business and otherwise, (5) talking with others who have been in such situations and (6) building up of models.

Is all of this potentially extrapolated from unusually bad experiences? It is certainly possible, but those experiences seem to have been chosen in ways that would not be likely to maximize their degree of badness beyond the issue of size. The book certainly wasn't trying to paint as gloomy a picture as it could have.

But of course, the picture is extreme. And no, none of the examples here or the ones I've directly experienced were tech as such.

In tech, I would describe the maze structure differently, and the maze would importantly extend beyond the corporation itself, but that's a complex topic I can't get into fully here.

In tech, I would describe the maze structure differently, and the maze would importantly extend beyond the corporation itself, but that's a complex topic I can't get into fully here.

If you're making a claim that this model is applicable outside the excessively-toxic specifics in the book, I'd really enjoy seeing how it applies or differs in tech. I'd also be interested in a comparison with Steven Levitt's work on low- and middle-level drug dealing (briefly discussed in _Freakonomics_, I haven't read his actual paper on the topic).

Fundamentally, I don't doubt that these unpleasant equilibria exist, but I question how common they are and how applicable any lessons from them are to more moderate examples. I don't think we've seen enough examples to find common causes/features, let alone recommendations.

My guesses:

  • Tournament/pyramid structure: unpleasant to horrific for entry-level participants, pretty darned nice at the top, but the vast majority never make it anywhere close to the top. Applies to sports, entertainment, some kinds of retail, and many crime setups.
  • Very large potential rewards (which, again, most don't get). Goes hand-in-hand with tournament list.
  • Participants don't see attractive alternatives (I think "entry/exit" is a mis-statement of this one). This is often an input to the equilibrium, rather than an attribute of it.
  • I'm unsure whether objectivity of performance measurement matters. It's lacking in management, present in sports/entertainment stars, unsure in criminal gangs. There probably does need to be a sense of unfairness by the losers and smugness by the winners, in order to make it really soul-crushing.

How many levels of hierarchy are there in their organizations?

(I've read some advance draft's of Zvi's sequence and know that an upcoming claim, which I think probably should have been made explicit here, is that this sort of thing is most true in large companies with many layers of hierarchy. i.e. the author of Moral Mazes was in a company with 25 levels)

I hate to identify my employer this precisely, but you can likely guess it from other things I've posted, and perhaps just from this. Please don't out me in any easily-searched way; I like my deniability.

I've been 15 years at a very large retail/tech company which has become truly gigantic during my tenure. There are 8 salary levels between entry-level programmer and CEO, and reporting chains of 7-10 are not uncommon for skilled workers (including chains like CEO-SVP-SVP-VP-VP-Director-Sr.Manager-Manager-Manager-IC). Number of salary levels here is ludicrously smaller than normal, but reporting chains are, if anything, deeper than other big companies I know of.

I would be interested to hear the names of companies that have 25 levels of reporting structure. That's insane.

Thanks for the explicit info.  (While I certainly won't out you, it'd probably fine if you slightly randomized each of the information to make it harder to pin down, if you haven't already)

I have more thoughts about how this fits into Zvi's model but I think makes more sense to wait until a future post.

Yeah, I added a note at the top (in original, please reimport) to make this explicit. The requirement to meet this picture is not merely "I have someone who reports to me and someone I report to" ergo all of this, and the discussion about that comes later.

Questions that will be considered later, worth thinking about now, include: How does this persist? If things are so bad, why aren’t things way worse? Why haven’t these corporations fallen apart or been competed out of business? Given they haven’t, why hasn’t the entire economy collapsed? Why do regular people, aspirant managers and otherwise, still think of these manager positions as the ‘good jobs’ as opposed to picking up pitchforks and torches?

I hope you also answer a question I had when I was reading this: it's percolated down into common consciousness that some jobs are unusually tough and demanding. Medicine, finance, etc have reputations for being grueling. But I'd never heard that about middle management and your picture of middle management sounds worse than either. Any thoughts on why knowledge of this hasn't percolated down?

Any thoughts on why knowledge of this hasn't percolated down?

Maybe it's an incorrect view. Like I indicated in my other answer, the picture painted by this post does not at all correspond to my experience in large corporations, nor does it correspond to my father's experience as a middle manager in a large corporation.

Before we ask ourselves why something is correct, we should endeavor to ensure that it is in fact correct.

Two reasons come to mind:

1) much of the reason it's grueling and unpleasant is that it's a social tournament, with success being predicated on convincing people that you're successful. This naturally encourages participants to play up the benefits and downplay the costs to outsiders (and each other, and themselves).

2) It's not as evenly distributed as the well-known difficult jobs - there are pretty good middle-management positions that can easily be found as examples to attract suckers to play your game.

I suspect that by the time someone notices they've been baited-and-switched by #2, they've invested enough in #1 that they start to believe it can't get better.

Thank you for calling attention to that question. It wasn't on the core list and it should be there. It's sort of implicitly within that last question, but also importantly distinct and should be answered first. I should think more explicitly about that.

I do have a few good potential mechanisms I can point to, but will work to improve my model slash wait until I've laid out more of my model, rather than answer here.


I think this starts to make more sense if you realize that there's a lot of organizations where a manager can't make an outsized improvement in results but can do a lot of damage; in those places, selection effects are going to give you risk-averse conforming people.

But in places with very objective performance numbers — finance and sales in particular — there's plenty of eccentric managers and leaders.

Same with tech and inventing, though eventually a lot of companies that were risk-seeking and innovative do drift to risk-averse and conforming. It's admirable when organizations fight that off. I don't have very many data points, but the managers I've met from Apple have all seemed noticeably brilliant and preserved their personal eccentricities, though there is a certain "Apple polish" in way of speaking and grooming that seems to be almost de rigeur.

That's probably not a bad standard to be expected to conform to, though, since it's like, pretty cool.

I think I've actually never met anyone who worked at Apple, at least that I can remember. If anyone can stall this by sheer force of will it would have been Steve Jobs. I would be curious to what extent Apple is/was unique due to Steve Jobs, and to what extent it has or is even trying to hold onto that now. The new regime seems from simple outside impression to be much more normal-corporate.

An Immoral Maze can be modeled as a super-perfectly competitive job market for management material. All the principles of super-perfect competition are in play. The normal barriers to such competition have been stripped away. Too many ‘qualified’ managers compete for too few positions.

Why is middle management more of a super-perfectly competitive field than other jobs? I'm skeptical that "super-perfect competition" is really what makes middle management more of an "Immoral Maze" compared to other fields. I'm guessing that something like the difficulty of measuring manager productivity (given randomness of the people they manage and other environmental factors) probably has more to do with it.

You previously wrote:

We will define super-perfect competition as competition that mostly has most of the elements of perfect competition, but lacks free entry and free exit, which creates more production than there would be at equilibrium (and thus, also, a lower price).

I don't see why middle management would especially "lacks free entry and free exit".

The next post, called "Stripping Away the Protections," is about answering this question.

My basic answer is that there are many different ways to disrupt the dynamics that end in super-perfect competition, and here we see an unusually large number of them being absent, through a mix of intentional engineering of that and some amount of natural circumstance.

Difficulty of measurement (both inherent to the situation, and intentional prevention of accurate measurement) is a big factor.

Lacking entry and exit is a necessary factor more in the sense that if entry and exit were free, then that would protect against this outcome a lot, rather than this lack being especially big. Lacking free entry and exit is common, and actually having it is rare in general - managers make large investments in their paths, but so do lots of others. Perfect competition is really really weird.


Lacking free entry and exit is common, and actually having it is rare in general - managers make large investments in their paths, but so do lots of others.

A large investment in a path is not a barrier to exit - that would be the sunk cost fallacy. Sunk cost fallacy itself may be a barrier to exit, though.

When considering a barrier to exit, do they usually include the cost to go somewhere else? Quitting is free and easy, but getting another job elsewhere isn't, especially when considering opportunity costs.

Yes, cost to go somewhere else is a barrier to exit. However, it's a barrier to exit which applies to basically all jobs, some more so than others, but middle management does not seem at all unusual in that regard. It certainly wouldn't explain why middle management at large companies is so much more value-less than other jobs.

If your value at a company is 90% determined by your relationships, moving to a new company in most cases means giving up 90% of your value to the company since you will have no relationships at a new company outside of a coordinated move.

If you aren’t in middle management you potentially have other ways of demonstrating value to be better placed and not sacrifice as much career progress.

True, but that's a sunk cost, not a barrier to exit.

I think sunk cost fallacy just counts as barrier to exit (I agree it's good to be clear about when you're talking about fallacies vs literal sunk costs, but your comments on that have felt sorta pedantic to me)

It's not pedantic if it impacts the model significantly, and I think it does. Patient: "Doctor, it hurts when I do this". Doctor: "Don't do that.".

If there are literal barriers to exit, that explains why people stay in situations they don't like. If there are only perceptual barriers to exit, one has to ask why a small amount of thought/education isn't sufficient to free them.

We probably do need to answer the question "is all of western middle-class ambition (single-family dwelling, atomic family, mild status games with the neighbors, etc." a moral maze? Zvi seems to be saying no, but then "can't make as much money if you leave this horrible company" isn't an actual barrier, just a perceptual one.

I think trivial inconveniences are more than enough to count as a significant barrier to exit, and these are not trivial inconveniences being discussed. Small amounts of thought / education fail to change behavior all the time.

Hmm, okay looking more at the comment you were replying to, I agree that seems to be making a bit more of a point about the actual sunk cost rather than the fallacy. 

I still feel like... okay, I'm not that familiar with the technical terms in economics and maybe there's a more precise way of saying this, but, if people reliably aren't choosing to leave a job because they're invested in the job, that feels like something that should play a pretty similar role in the equation as "barrier to exit." 

Yes, I agree (I think with you elsethread, or maybe another commenter?) that this is true of many jobs. But the strength of the effect can still vary (and it makes sense to me for it to be stronger in jobs where most of the capital you acquire are relationships within the company). Meanwhile, even if most jobs have some kind of barrier to exit (due to plain inertia), combining that with stronger competition within the job could produce interesting effects.

Remember, the original issue here is superperfect competition. In order for the model to work, there has to be something forcing people to stay in the game when they would prefer to be out. E.g. I'm in the kitchen, I would prefer to be in the dining room, but something prevents me from leaving the kitchen. "All my relationships are in the kitchen" is not usually something which prevents me from leaving when I would already prefer to be out; it's something which makes me not want to be out of the kitchen in the first place. Even if I were already in the dining room, I'd want to go back to the kitchen if all my relationships were there.

That's the central confusion I see coming up here repeatedly: most of the reasons people are talking about for not leaving middle management are reasons to not want to be out; they are not reasons to stay in when someone does want to be out.

Even the typical usage of "invested in a job" suggests a reason that someone would not want to be out of the job, as opposed to forcing them to stay when they do want to be out.

That's the problem here: if people stick in middle management because they do not want to be out, then we do not have superperfect competition. Rather, we have ordinary competition over a not-very-legible-but-entirely-legitimate kind of value.

EDIT: an analogy. We have a mix of hydrogen and oxygen gasses in a container. If they react to form water, they will be at lower energy - they "prefer" to be in that lower-energy state. But the two can't react without a spark - there's an energy barrier (exactly analogous to an exit barrier), and the barrier prevents the system from moving to a preferred state. The key distinction is between the relative energy of the two states, vs the height of the barrier.

Even the typical usage of "invested in a job" suggests a reason that someone would not want to be out of the job, as opposed to forcing them to stay when they do want to be out.

Okay, I think I get what you're saying more here. But the distinction that feels important is something like: "if a system manipulates you in such a way that, initially, you thought you were getting a good deal, but upon reflection you got a bad deal and now it's hard to change your mind about that deal", that's something that feels more appropriate to me to treat as an artificial barrier-to-exit, than as a mere sunk cost + opportunity cost.

I think there's a spectrum of barriers-to-exit, ranging from mild trivial inconveniences to "literally a slave owner will shoot you if you try to escape." I think most jobs have some nontrivial barrier in the form of inertia/inconvenience (which indeed affects the job market).

I think there's some flaw in term "super-perfect-competition" in that in implies some spectrum from imperfect-perfect-superperfect, and in fact situations can be a mixture of "how perfect the competition is" plus "how high the barriers to exit are", which varying effects depending how high each one is. (At the beginning, Zvi notes that [upper]-middle-management is nowhere near "Contract Drafting Em" levels of bad, but still bad enough to see particular effects."

I'm not actually that sold on the claim, but the barrier to exit thing still seems like a meaningful part of the model.

But the distinction that feels important is something like: "if a system manipulates you in such a way that, initially, you thought you were getting a good deal, but upon reflection you got a bad deal and now it's hard to change your mind about that deal"

I totally agree. That's pointing to something very interesting. It has nothing whatsoever to do with competition, and I think trying to frame this whole thing in terms of competition and barriers to exit is making a complete mess of a potentially interesting idea.

Okay, that sentiment makes sense (although "nothing whatsoever to do with competition" still sounds false, even if the active ingredient is the manipulation, and it wasn't necessary to hypothesize "super-perfect competition", regular competition still clearly plays a role.

I think the confusion is in treating competition as an single attribute rather than a set of relationships between different entities. Specifying the competitive dimensions, and who is competing for what, will probably resolve it. Generally, competition sucks for competitors and is good for customers. Every transaction has two sides.

Companies are competing for employees. This competition is good for employees (and irksome for companies), and there's a puzzle about why a person would stay in a toxic environment rather than going to a nicer one. My hypothesis is that the perceived rewards (including perhaps-incorrect estimates of future promotions) are actually there and those that stay are making a choice, rather than being trapped.

Employees are competing with each other for positions. This is bad for the losers, good for the winners, and good for the companies, to the extent that the dimensions of competition are actually aligned with what the business needs. My hypothesis is that the competition in these cases is on illegible dimensions, so it's unclear (from outside, and perhaps from inside and below, unlikely from inside and above) that it's good for anyone.

Companies are competing with each other for customer money. Depending on how much customers pay attention and how agile they are, there may be more or less slack in this competition, and that may lead to better or weaker alignment between company needs and employee competition dimensions.

The contradiction I don't get in the analysis so far is the simultaneous claim that competition is so fierce that it's gone beyond actual competition into some overfitted mechanism (super-competitive), AND that it's mostly a problem in orgs that have enough slack to not really care about this waste.

The barrier to exit is the cost of rebuilding those relationships. The old saw, "It's not what you know, it's who you know," applies quite heavily to management. The key value that managers add to front-line people is that quality of being a "human switchboard", knowing who is working on what, who needs to talk to whom and, most importantly, who should not talk to whom. When a manager switches firms, all of that implicit knowledge has to be built up from zero. It's a huge cost, and represents a significant barrier to exit.

I'm not in middle management, but my dad is (at a Fortune 500 corporation, with something like 8 levels of management between contributors and the CEO), and his experience is far different from what you've described here.

We have this idea that there is work and there is not-work, and once one leaves work one is engaged in not-work distinct from work. We also have this idea that there are things that are off limits even at work, like sexual harassment.

For a person without anyone reporting to them, who is ‘on the line’ in the book’s parlance, this can be sustained.

For those in middle management who want to succeed, that’s not how things work. Everything you are is on the table. You’d better be all-in.

If anything, my dad works less than I do, and I have no ambitions to be anything more than an individual contributor. Yes, at times he has to be on-call when his team is doing a deployment, but I've found that overall he works fewer hours than I do. Moreover, it's not like my dad is coasting; I would estimate that he works harder than his peers. Do you have any statistics that can compare the average amount of hours worked for individual contributors and manager at a large corporation?

If the job requires you to move, anywhere in the world, you’ll do it, dragging your nuclear family along and forcing all of you to leave behind everything and everyone you know. Otherwise, you’re just not serious about success.

Again, speaking from personal experience, this is not the case. My dad was asked to move, when I was younger. I and my mother vehemently objected. He went to his boss and demurred... and so far as we know, he suffered no consequences for it. He was later promoted, and then, years later, laid off when the company merged with another company (as so often happens in the modern economy).

I guess my question is, "What evidence do we have that Moral Mazes actually describes life inside a large, modern corporation?" The quotes you've given here go very much against both my own and my father's experience.

By contrast this does match my wife's experiences as a senior manager in a large non-profit. There were repeated and consistent messages about being expected to respond to emails and calls at all hours as you moved up the hierarchy; the performance metrics were fixed so everyone fit within a narrower band; actual outcomes of programs did not matter suggesting that they did was punished (culminating in one fascinating episode where a VP seems to have made up an entire program which delivered 0.001 of projected revenue, resulting in a revenue shortfall of some 25% for the whole organization, and who was not fired).

That's interesting to hear. If I might ask, how large is this nonprofit, in general terms?

One of the largest in the country. The core organization is less than a thousand, but they have state affiliate organizations and as of recently international ones as well.

It is exceedingly top-heavy; I want to say it was approaching 5% executives, not counting their immediate staff.

The organization is functionally in free-fall now; they are hemorrhaging people and money. I expect if it were for-profit this is the part where they would go bankrupt. The transition from well-functioning to free-fall took ~5 years.

If the core organization is a thousand, then that's not very big, to be honest. Even if there are other affiliated, franchise organizations, the fact that the core is a thousand means that, organizationally, this nonprofit is probably closer to a just-past-startup corporation that it is to a Fortune 500 company.

The company my dad works for directly employs more than a million people. Microsoft employs roughly 90,000. Google employs, last I read, somewhere around 50,000. Amazon, if you don't count warehouse workers, employs somewhere around 60,000 (if you do count warehouse workers, it's roughly 500,000). This is roughly the order I'm talking about when I talk about a large organization.

The reason I'm so skeptical of the claims in the OP is that once an organization gets up these kinds of employee numbers, it's statistically highly improbable for middle management to be as described in Moral Mazes. There just aren't enough hyper-ambitious people to fill the roles. The vast majority of people don't actually want to subsume everything into their job -- they just want to do their work, get paid, and then go home to do whatever it is they do for fun.

I don't doubt that senior management is like what's described above. But there is a large difference between a Senior Vice President or Director angling for a C-level position and a middle manager who goes to work, puts in his 9-5 and then goes home and relaxes with the kids and goes fishing on weekends. My intuition is that the latter sort actually make up the majority of middle management.

I think I agree with your intuition, though I submit that size is really only a proxy here for levels of hierarchy. We expect more levels in a bigger organization, is all. I think this gets at the mechanisms for why the kinds of behaviors in Moral Mazes might appear. I have seen several of the Moral Mazes behaviors play out in the Army, which is one of the largest and most hierarchical organizations in existence.

I don't see why being consumed by your job would predict any of the rest of it; programmers, lawyers, and salesmen are notorious for spending all of their time on work, and those aren't management positions. Rather, I expect that all these behaviors exist on continua, and we should see more or less of them depending on how strongly people are responding to the incentives.

My intuition is that the results problem largely drives the description to which you are responding. Front line people and front line managers usually have something tangible by which to be measured, but once people enter the middle zone of not being directly connected to the top line or the bottom line results, there's nothing left but signalling. So even a 9-5 guy who goes fishing is still likely to play politics, avoid rocking the boat, pass the blame downhill, and think that outcomes are determined by outside forces.

I would be shocked to my core if Moral Mazes behaviors rarely appeared under such conditions.



I was specifically referring to these two passages:

When asked who gets ahead, an executive vice-president at Weft Corporation says: The guys who want it [get ahead]. The guys who work. You can spot it in the first six months. They work hard, they come to work earlier, they leave later. They have suggestions at meetings. They come into a business and the business picks right up. They don’t go on coffee breaks down here [in the basement]. You see the parade of people going back and forth down here? There’s no reason for that. I never did that. If you need coffee, you can have it at your desk. Some people put in time and some people work.

For those in middle management who want to succeed, that’s not how things work. Everything you are is on the table. You’d better be all-in.

That hasn't been my experience. In my experience, those who get ahead are not those who work hardest, but those who are most visible. You can "come in earlier, and leave later", but it won't matter if your project is not one that's a priority for senior management. Moreover, that sort of "working harder" doesn't seem to correlate with whether your project gets picked up as a priority or not.

So even a 9-5 guy who goes fishing is still likely to play politics, avoid rocking the boat, pass the blame downhill

To a first approximation, that's true of every job role, whether it's front line, middle management, senior management, or the C-suite. Nobody wants to look bad. Nobody wants to be blamed for a problem that they don't perceive was their fault. My disagreement is not with the fact that people play politics at work. Of course people will play politics; it's human nature to have politics when you have more than two people attempting to make a decision on which there's meaningful disagreement.

What I disagree with is the notion of middle management as a sort of all-consuming lifestyle that totally snuffs out your ability to be yourself outside of work. Maybe it's like that at some firms (like finance, or law), but my intuition is that most firms are not like that. Most firms are less American Psycho and more Dilbert.

I think the model here is intended to apply specifically to upper-senior-management (I think you touched on this elsethread. I think it was basically a mistake not to focus on that more specifically)

Yeah, I would agree with that. I was really confused when the OP kept referring to "middle management".

(Is considering oneself "middle management" like considering oneself "middle-class" -- i.e. everyone considers themselves that, even when they're far above the actual median?)

I think an issue was that, in a 25 tier company, "middle management" (i.e. "tier 13?") is above what one might colloquially refer to as "middle management."

A 25-depth reporting chain, where each manager only has 2 reports, is 33 million employees. Do these companies have long segments of managing just one person, who then manages one who manages at most a few? I would like a specific example, please.

25 salary grades or titles is pretty common, and gives room for in-place promotions, where you are paid more without changing the reporting structure. And doesn't really map to the pain described here.

That's fair, though I do wonder how representative 25-person-deep reporting chains are. I've never worked in a company that had a reporting chain > 8 and my dad works in a company with a reporting chain of 12. 25 seems... incredibly painful.

I don't know what a more representative company size was, mostly just guessing the causal factors leading to Zvi summarizing it as "middle management."

I think the model requires 2 things:

  1. being promoted far enough into the system that there's a basic assumption of competency across all dimensions
  2. being surrounded, in both directions, by at least 2 layers of management (separating you from anyone who's got more direct contact with reality). 

The second bit requires 5 levels (level 1 is in direct contact with object-level-workers, level 5 is in contact with the CEO who at least hopefully cares about the bigger picture. But level 3 is steps removed from either). I think it makes sense for this to cause epistemic warping, whether or not it comes with any pathologies relating to competition.

The first bit... probably depends on your industry and culture. My made-up-ass-pull-guess is that you need more like 4 levels of promotion before there's a plausible assumption that "everyone is competent" (so, combined with #2, companies with around seven layers). 

The idea that someone can just be better at doing the actual job doesn’t parse for them.

That's not what the quote said. The quote said that the difference between a general manager and a vice-president is not one due to abilities.

There's another quote which suggests that there's a belief in are skill differences:

he himself may get done in by his boss’s errors, and, perhaps more important, other managers will view with the gravest suspicion a subordinate who withholds crucial information from his boss even if they think the boss is a nincompoop.

The first quote seems be due to the fact that it's very hard to actually measure the skill differences. If you make good long-term decisions for the company that pay five or seven years down the road, it's difficult to reward you for those if you stay three or four years in your position.

In an environment where skill differences can't be measured in a way on which you can base promotion decisions you get people engaging in behavior that signals a hard work ethic because you can make your promotion decisions based on the willingness to signal.

The context of the second quote gives me three instinctual reactions.

1. One can reasonably hold the belief that everyone makes mistakes and that the boss lacks crucial feedback/information if you don't give it to them. And the point here is that you get blamed for the failure of your boss regardless of whose fault that is because that's how blame works, it travels downward.

2. There are different kinds of belief and they interact in strange ways; you can hold 'ability is constant' in one sense while still thinking your boss is an idiot.

3. There is the belief that some people are idiots, and your boss might be one of them - the negative selection part of skill is real, it's just that there's no positive selection.

For the first quote, I agree that this quote in particular only makes this claim for relatively high levels (I'm not sure what 'general manager' means exactly, except in sports where it generally means the level of management just below the owners/top, above the manager, who has assistant managers). So good note - I was relying on my full experience of the book and it would be better if I'd provided stronger direct evidence. I quickly scanned to see if I pulled any other quotes that said the same thing about lower ranks, it seems like I didn't, but that message was repeated by a number of interviewees, many of whom did not isolate such high skill levels. And of course, restricting it to the two levels below the top does not make it much less insane.

An Immoral Maze can be modeled as a super-perfectly competitive job market for management material. All the principles of super-perfect competition are in play. The normal barriers to such competition have been stripped away. Too many ‘qualified’ managers compete for too few positions.

I see the argument for near-perfect competition here. I don't see the argument for super-perfect competition; that would require barriers to exit. What's the barrier to exit?

Much like in the perfect competition post, it sounds like you're confusing "competition" with "abundance". The last sentence in the quote is particularly suggestive: "Too many ‘qualified’ managers compete for too few positions.". Managers are abundant, therefore their price will drop to zero - the managers themselves don't have any marginal value. That's not about competition, it's about abundance.

The question of 'why don't these people all just quit' is a good one. I forget exactly where I lay out what exactly the costs of exit are, if it's not clear, but:

1. The sunk costs are huge. You give up all of your investment, lose the related social/human capital. You've built your life around this job - you've chosen your friends, your location, your skills, often your family. Not only do you give up potential upside but your income right now drops through the floor.

2. You've self-modified to get this far, in ways that make leaving or failing painful to you, and which will hurt you on the outside.

3. As you invest in this, you give up other opportunities to learn how to work outside a maze and be effective.

It is common for people who quit (based on personal experiences of friends) to have no idea how to actually do real object-level work, or how to do so and get paid for it or otherwise extract any value from it, due to how long they've spent in mazes. Which, depending on what you think of school/academia, could be basically their whole lives.

Two posts from now is where I currently have the "if you are this person, QUIT NOW" post, and I expect tons of the objection that this is completely unrealistic an ask because exit is too expensive.

Most of these are not actually barriers to exit. Many of them do enter the calculation of value of the job (relative to opportunity cost), but those are not exit barriers. Exit barriers are a one-time cost incurred by exit (example: cancellation fee), not lost ongoing benefit (example: foregone salary) - that's why they're called "exit costs", not "opportunity costs".

Let's go through a few.

The sunk costs are huge. You give up all of your investment, lose the related social/human capital.

Sunk costs are not a barrier to exit - that would be the sunk cost fallacy. The fallacy itself may be a barrier to exit, though, and "middle managers are committing the sunk cost fallacy in droves" sounds entirely plausible.

You've built your life around this job - you've chosen your friends, your location, your skills, often your family.

My girlfriend is a software engineer at Google. One "barrier" to her leaving is that she's pretty close friends with her co-workers; we all hang out pretty often outside of work. That's not an exit barrier any more than "not getting paid salary" is an exit barrier. The job provides value partly in friends and culture, and that's a perfectly reasonable way to get paid.

If managers gain negative value (net opportunity cost) from their jobs, then friends/culture/etc need to be included in that calculation. If friends/culture/etc make it net-positive, then that's fair - the job provides value.

You've self-modified to get this far, in ways that make leaving or failing painful to you, and which will hurt you on the outside

There's two claims here: (1) people have self-modified to create their own barrier to exit (by "making it painful"), and (2) people have self-modified in ways which will hurt them on the outside. Of those two, only the first is a barrier to exit. The second enters into the net value calculation.

As you invest in this, you give up other opportunities to learn how to work outside a maze and be effective.

Sunk costs again.

Other than self-modification to make leaving painful, the only other item in the list which is actually an exit cost is:

your income right now drops through the floor

i.e. the temporary loss of income while job-hunting. (There may also be a long-term loss of income if the new job pays less, but that goes in the net value calculation, not the exit cost.) Of course, this item applies to all job-hopping, and I see no reason at all to think it's especially relevant to managers or people in mazes.

Bottom line: there is still no viable case here for super-perfect competition, or at least no more so than in most jobs. There is potentially an interesting case for people self-modifying in ways which make their opportunity costs less appealing, or their current job more appealing.

It is common for people who quit (based on personal experiences of friends) to have no idea how to actually do real object-level work

I'm quite surprised by this but don't find it entirely implausible.

Concretely, what evidence caused you to believe it? I'm curious about data (anecdotes, studies, experience, ...) rather than models.

Many examples from people in the community, plus other people I have known, who found themselves in that situation, are a strong contributor to this. Some of them described their experiences very well. Also personal experience - I noticed that I myself had no idea how to do this outside of a few select areas where I had unusual experiences and friends who helped me achieve this, slash some of my talents/skills happen to have unusually direct paths to being useful work.

We can also look at general behavior in these situations, how people talk when they are looking for what to do next and clearly want to do something object-level both real and in fiction, etc etc. And we can look at the fact that it is strangely hard to find good hires for real object-level tasks even with solid pay.

Studies are basically not a thing anywhere in this sequence, they don't exist and I don't even know how one would do one if you had the funding and support to do so. That's one big reason why all of this remains deniable/invisible.

I think the barriers are essentially cultural: once you've made tradeoffs of the form "choose friends, politics, etc based on corporate promotion", it then becomes pretty hard to back out of that.

There are also financial barriers. Managers generally have mortgages, kids in private school or college, etc. They have debts to pay and mouths to feed.