Company Hierarchy

Hugh MacLeod’s cartoon is a symbol of an unorthodox school of management based on the axiom that organizations don’t suffer pathologies; they are intrinsically pathological constructs. The Sociopath layer comprises the Darwinian/Protestant Ethic will-to-power types who drive an organization to function despite itself. The Clueless layer is the “Organization Man”. The Losers are not social losers (as in the opposite of  “cool”), but people who have struck bad bargains economically, giving up capitalist striving for steady paychecks.

The Sociopaths defeated the Organization Men and turned them into The Clueless not by reforming the organization, but by creating a meta-culture of Darwinism in the economy: one based on job-hopping, mergers, acquisitions, layoffs, cataclysmic reorganizations, outsourcing, unforgiving start-up ecosystems, and brutal corporate raiding. In this terrifying meta-world of the Titans, the Organization Man became the Clueless Man. MacLeod’s Loser layer represent the losers in the economic sense: those who have, for various reasons, made (or been forced to make) a bad economic bargain. They’ve given up some potential for long-term economic liberty (as capitalists) for short-term economic stability. Traded freedom for a paycheck in short. They actually produce, but are not compensated in proportion to the value they create (since their compensation is set by Sociopaths operating under conditions of serious moral hazard). They mortgage their lives away, and hope to die before their money runs out. Losers have two ways out: turning Sociopath or turning into bare-minimum performers.

Based on the MacLeod lifecycle, we can also separate the three layers based on the timing of their entry and exit into organizations. The Sociopaths enter and exit organizations at will, at any stage, and do whatever it takes to come out on top. The contribute creativity in early stages of a organization’s life, neurotic leadership in the middle stages, and cold-bloodedness in the later stages, where they drive decisions like mergers, acquisitions and layoffs that others are too scared or too compassionate to drive. They are also the ones capable of equally impersonally exploiting a young idea for growth in the beginning, killing one good idea to concentrate resources on another at maturity, and milking an end-of-life idea through harvest-and-exit market strategies.

The Losers like to feel good about their lives. They are the happiness seekers, rather than will-to-power players, and enter and exit reactively, in response to the meta-Darwinian trends in the economy. But they have no more loyalty to the firm than the Sociopaths. They do have a loyalty to individual people, and a commitment to finding fulfillment through work when they can, and coasting when they cannot.

The Clueless are the ones who lack the competence to circulate freely through the economy (unlike Sociopaths and Losers), and build up a perverse sense of loyalty to the firm, even when events make it abundantly clear that the firm is not loyal to them. To sustain themselves, they must be capable of fashioning elaborate delusions based on idealized notions of the firm. Unless squeezed out by forces they cannot resist, they hang on as long as possible, long after both Sociopaths and Losers have left.

[Venkatesh Rao (2009), ribbonfarm]

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