Incentive Archaeology

Tactics of Organizational PoliticsInformation and NarrativeA tactic to use

Working out what an organization actually rewards by comparing recent promotions with the written criteria, then putting effort where the last few promotion classes put theirs, whatever the handbook praises.

An example

Three years from partner consideration at a mid-size accounting and advisory firm, a senior associate pulled the announcements for the last five partner classes and built a spreadsheet. Each row was a new partner. The columns were the criteria in the firm's career handbook, plus a few the handbook never mentioned: who had sponsored them, which practice they came from, how much new client work they had originated in the two years before the vote. The handbook led with mentoring, firm citizenship, and technical quality. The spreadsheet showed that eleven of the fourteen new partners had originated more than a million dollars in fees, and only two had led an internal committee. The associate stepped off the recruiting committee, kept the mentoring that mattered to the team, and spent the next eighteen months on two client pursuits with the head of the tax practice.

Why it works

Nobody else's options change. This works on the reader's own choice about where effort goes, replacing the official account of what is rewarded with the record of what was rewarded. Organizations often praise one set of behaviors and promote on another, and people who read only the handbook can spend years on work that looks good and counts for little. The comparison makes the rewarded path look better and the praised-but-unrewarded path look costlier in time. It is only as good as its sample: a handful of cases, or a change in who decides, makes the pattern harder to read.

The thinking behind it

Edward Lazear Lazear and Rosen's Rank-Order Tournaments as Optimum Labor Contracts (1981) shows that when output is hard to measure, paying people by rank, with prizes fixed in advance for whoever finishes first, can draw efficient effort from every contender. A promotion or partner decision works like such a tournament, and contenders compete on whatever the judges are seen to reward. Reading the record of past winners tells the reader what the judges reward, which the handbook may not.

Leon Festinger In A Theory of Social Comparison Processes (1954), Festinger argues that people judge their opinions and abilities by comparing themselves with similar others, especially where no objective standard exists. Promotion criteria are rarely objective, so ambitious people already watch who gets promoted. This move makes that comparison deliberate: a case-by-case reading of recent winners against the written criteria, in place of an impression formed from hallway talk.

George A. Akerlof Akerlof's The Market for "Lemons": Quality Uncertainty and the Market Mechanism (1970) shows that when one side cannot verify the other's claims, it discounts all of them. A career handbook is a claim employees cannot check, while the promotion record is the closest thing they have to verified information. Leaders who let the two diverge teach their people to discount every official statement about what counts, including the true ones.

When it fits

Anyone deciding where to put scarce discretionary effort over the next year or two can use it, especially before a promotion or partner decision. It needs access to who was promoted, with enough detail about their work to compare, and a few colleagues who will say what the official record leaves out. It costs time and discretion, little else.

How to use it well

Start with the record. List the last several promotion classes for the role you want, and for each person note what the written criteria would predict and what they did in the two years before. Look for the behaviors that appear in nearly every case, and the praised ones that appear in almost none.

  • Check your reading with two or three people who sat in the decisions or close to them, and ask what tipped the close cases.
  • Move effort toward what the record rewards without dropping the handbook items entirely; they still show up in the file.
  • Keep the analysis to yourself. A spreadsheet of colleagues' promotions, read the wrong way, looks like a grievance.

What it costs and where it backfires

The direct cost is time, plus some risk to how you are seen if the work becomes known. The bigger risk is reading the past too literally: what got the last classes promoted may not get the next one through, and the analysis shows what was rewarded without explaining why. Once the reading turns into talk about who was promoted unfairly, it stops being a planning tool and starts costing you allies.

When it is used on you

Leaders who see their people reading the promotion record should expect effort to drift toward what the record rewards. That drift is information. If the gap between the handbook and the decisions is real, close it: publish the actual basis for recent promotions, then change either the written criteria or the decisions until both describe the same thing.

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