IT#5 Corporate Parasites

#ITManagement #Management #UniversalEvolution #Parasites #CorporateParasites

This article explains certain types of harmful employee behavior (especially those in the management positions) from the POV of the universal evolution theory and parasitic relationships. It also explores when such behavior is avoidable and how.

What is the universal evolution theory and why is it applicable to business?

The universal evolution theory states that most evolutionary phenomena we observe in the biological evolution are applicable in any system where we have:

1. A limited pool of resources.
2. A number of competing entities consuming and fighting for those resources.
3. A kind of replication that keeps some similarity and some mutation from generation to generation.

Just these three conditions. If they are satisfied, you get an evolutionary environment.

In the biological evolution these are (1) an ecological niche, (2) the organisms (e.g. animals) that live inside it and compete with each other, and (3) procreating with inheritance and mutations while living in that ecological niche.

However, these three conditions are also applicable to corporations and other large organizations like schools, army, city,county, state and federal governments. In all these cases we have:

1. Pool of resources: money used for salaries, bonuses etc.
2. Employees who consume and sometimes fight for those resources.
3. A replication of employees is done through hiring. The commonly used interview systems provide similarity and some mutation from generation to generation.

Notice that "sometimes fight". This is very important. Without that you are getting a very different type of environment. Not evolutionary. Collaborative. Unfortunately in reality this "sometimes" means almost always. We will discuss exceptions from this unfortunate rule and how to use them. But otherwise a corporation for employees is an evolutionary competitive environment.

If we get an evolutionary environment, we get an evolution. And then everything that comes with it. Including competition and parasites. Let's talk about them.

What are parasites?

According to the Centers for Disease Control and Prevention "A parasite is an organism that lives on or in a host organism and gets its food from or at the expense of its host." As usual with federal government entities, we get a bit of an incorrect definition. For example, a lot of gut bacteria in humans is symbiotic and contributes to our survival. They are symbionts, not parasites. But such definition is a good start.

In terms of the universal evolution theory, a parasite is:

1.     An entity that lives in another entity (an ecological niche or organism or whatever has resources),
2.     Gets its food from or at the expense of its host,
3.     And contributes to its demise or otherwise hurts the host.

In biology most of the gut bacteria are not parasitic, they are symbiotic. They help us digest certain things and contribute to our health. They take but they also give. But some of them, those which make us sick, are parasites. Simple, right?

In society most people are symbionts. We kling together to create a better environment for each of us. But similar to biology, we also have parasites, in case of a society, criminals, who don't contribute to the society and, if let out of control, may decrease or even destroy the society.

Same thing exists in corporations. In a business environment, a factory worker, who gets the job done and gets paid according to it, is a symbiont. With such workers the business gets more money than without them. And the newly hired CEO, with whom sales dropped 30%, and who left with a golden parachute, is clearly a parasite. He should not have been hired in the first place. Right?

The most interesting things are going between those two extremes.

Again, we don't get parasites because of poor management. It only can produce a lot more of them, but they appear for a different reason. We don't get parasites because of socialists or capitalists, even if some of them are parasites. We don't get parasites because of some conspiracy. We don't get parasites because capitalism is bad. Or good. It comes from the times long before capitalism. There were tons of parasites in the Soviet socialism, and for sure there were some among Ancient Egyptian priests and scribes. The reason is that evolution still rules us wherether we are. We get an evolution, we get parasites.

So, how does it work?

First, let's reiterate.

You are not getting parasites in your corporation because your people are bad. In fact, most likely they are good.

You are not getting parasites in your corporation because of any other social reason.

You are getting parasites in your corporation because your corporation is an evolutionary environment. An evolutionary environment comes with parasites.

That's how it works. Period. We have over two hundred years of Charles Darwin evolution theory research to know that.

Yes, we know that. You can fight it, but you cannot eliminate it.

But how does it happens technically? Do you remember the main principle of evolution? Survival of the fittest. It's not survival of the strongest, smartest, most contributing… It's survival of the fittest, those who put their efforts to survive.

It's simple. Those who put their efforts to their survival and do it right, survive, those who do not, don't, so eventually you are left with survivors. Not performers, not smartest, not useful, not friendliest, survivors.

Maybe you think that you can build a perf system that will promote only those who contribute. Think again. If your company has more than Dunbar number[1] people, which is around 150, you will be the first one who did it.

I spent many years at Microsoft. And then at Google. At best their performance systems were an attempt to reduce the harm, they caused. At worst they did not do even that. When some VP become so evident parasite that it becomes evident not only to employees, but also to C-level management and founders, he was hit from the above, not eliminated by the perf system. And guess, how perf systems allowed that VP to raise in ranks to VP level?

Perf is just a part of the environment. Parasites adapt to the environment to survive and to get more food, in a case of business, money. No matter what perf system you will invent, they will adapt.

People, who want to bring more money to your business, won't. They don't want to adapt, they want to bring more money to your business. People, who want to build efficient teams that work together contributing to your business, won't. They don't adapt, the build the teams.

It's not that fighting with corporate parasites is hopeless. No. It's just the perf is not the right tool to fight them. Don't ask me, what perf evaluations are good for, but it's certainly not fighting corporate parasites.

That's it.

Can we solve it with ethical behavior?

The answer should be obvious, but some readers will still ask it. So, you have two people.

•    Person A is ethical and tries to do good for your company.
•    Person B just does it best to avoid being fired and getting promoted.

Who do you think will get promoted? If you think this will be the person A, please, take off your pink glasses. I've personally seen a case, when someone, who saved hundreds of millions of dollars to the company, but had to resist to the manager of his manager while doing so, was hurt. Well, that were not the worst times at that company, so he just had to move to another team and wasted two years without raises or decent perf reviews. There are cases when people were fired. And those who fired them and harmed the company were promoted.

Ethics is needed, and in fact, it's also the result of an evolution, only a bit different evolution. The evolution of social groups, communities, and countries. The evolution we talk about right now is the evolution of competing individuals.

Again, evolution is not the survival of ethical, it's the survival of fittest.

How can you avoid it?

I already mentioned a different kind of evolution, the evolution of groups, communities, countries. Originally, it was a competition between families and tribes. They also compete for limited resources, sometimes disappear, and sometimes fork from existing ones. So evolution controls them too, and here is you chance to eliminate competition and evolution from inside of your teams.

People are social creatures. So, while humans compete with each other, they are very good at competing together against others. One team competes with another, one company against another, etc. When people get together to compete with another group, we normally call it collaboration. At this point internal competition goes down and may be actually eliminated, because everyone works toward a common goal, or more precisely, against a common competitor. And with competition down, evolution is taken out of equation for your team.

However, to get that you must make the team collaborative. See the following article “IT#6 What teams in IT are for”, Collaborative culture is most easy to do in teams of up to 12 people in size. Technically it kind of works in larger team with an internal one layer structure, say 12 teams each 12 people. By the way, 12*12 = 144 people, which is suspiciously close to already mentioned Dunbar number.

It does not work beyond it. Based on my personal experience from the consulting times, somewhere between 300 and 500 people most employees see a sudden degradation of the company culture.

Can we overcome this limit? Certainly not with the classical American hierarchical management.  Well, unless you want to avoid corporate parasites, for a long time it was ok with the investors, owners and upper management. But it's not ok in the knowledge society. In the Knowledge Age we are getting human capabilities stretched too far, so the cost of incompetent top managers becomes too high. Not that cost of other incompetent managers is small.

There is a suspicion that this is what killed really the Soviet Union. They were losing control over their economy, which is typical for the Industrial Age management trying to control the Knowledge Age economy. In the USA we see similar staggering problems. The Europe will probably go next.

Robin Dunbar explained it through the capability of human brain to track all interconnections in the surrounding community, which was clearly a very important survival trait in a hunter-gatherer tribe. In addition, Malcolm Gladwell in his “Tipping Point” [2] expanded, that the number 150 is a sort of tipping point after which human community stops to function normally. So what does it mean, function “normally”? May be it's the ability of the members of the community to distinct contributing members, symbionts, from parasites? And if you cannot track someone's activity, how can you know if his or her contribution is positive?

Again, how to reach larger size than 150 people? Maybe we should follow the observed examples of Dunbar number, and arrange larger contingent of people in autonomous units of max 150 people? Examples include:

• Hunter-gatherer societies all over the world (Australia, New Guinea, Greenland, Tierra del Fuego) with an average tribe size of 148.4 people.
• The Hutterites (similar to Amish) communities: limit of 150 people per colony.
• The armies across the Globe: the functional fighting units not larger than 200 men. A Roman Century had 100 people: 80 legionaries and 20 slaves.

So, the problem was solved in non-business environment. Whether our society and business leaders are ready to solve it in commercial entities, that remains to be seen. For now we see:

• Getting sufficient number of managers who know how to run and maintain collaborative teams of up to 150 people. Current status: fail.
• Business leaders who understand that to succeed in the knowledge economy, one need collaborative, not competitive behavior of employees. Current status: fail.
• World leaders who understand the problem and trying to solve it without cutting down technology and reducing the humanity back to the Industrial Age or before it3, like they did in the Soviet Union. Current status: at least one regional fail, but two other regions follow.

Anyway, two thousand years ago Romans solved this problem. Maybe we can do that too. Let's hope for the best.

[1] Dunbar, R. I. M. (1992). "Neocortex size as a constraint on group size in primates". Journal of Human Evolution. 22 (6): 469–493. doi:10.1016/0047-2484(92)90081-J.

[2] The Tipping Point: How Little Things Can Make a Big Difference by Malcolm Gladwell.