Tag Archives: Venkatesh Rao

The Gervais Principle by Venkatesh Rao

Summary
  1. That, ultimately is what this book is about: organizational literacy, the reading and writing of organizational forms. But there is a cost to getting organizationally literate. This ability, once acquired, cannot be un-acquired. Just as learning a foreign language makes you deaf to the raw, unintelligible sound of that language you could once experience, learning to read organizations means you can never see them the way you used to, before. Literacy of any sort gives you the power to recognize and unambiguously label things that the illiterate can easily ignore as noise, fads and bullshit. This power can have very unpredictable effects. You may find yourself wishing, if you choose to acquire it, that you hadn’t. So acquiring organizational literacy is what some like to call a memetic hazard: dangerous knowledge that may harm you. A case of “where ignorance is bliss, ‘tis folly to be wise.”
Key Takeaways
  1. Idealized organizations are not perfect. They are perfectly pathological. So while most management literature is about striving relentlessly towards an ideal by executing organization theories completely, this school, which I’ll call the Whyte school, would recommend that you do the bare minimum organizing to prevent chaos, and then stop. Let a natural, if declawed, individualist Darwinism operate beyond that point. The result is the MacLeod hierarchy. It may be horrible, but like democracy, it is the best you can do.
  2. A Sociopath with an idea recruits just enough Losers to kick off the cycle. As it grows, it requires a Clueless layer to turn it into a controlled reaction, rather than a runaway explosion. Eventually, as value hits diminishing returns, both the Sociopaths and Losers make their exits, and the Clueless start to dominate. Finally, the hollow brittle shell collapses on itself, and anything of value is recycled by the Sociopaths, according to meta-firm logic.
  3. 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 – the perfectly pathological entities we mentioned. Unless squeezed out by forces they cannot resist, they hang on as long as possible, long after both Sociopaths and Losers have left
  4. Which brings us to our main idea – how both the pyramid and its lifecycle are animated. The dynamics are governed by the Newton’s Law of organizations: The Gervais Principle. The Gervais Principle is this: Sociopaths, in their own best interests, knowingly promote over-performing Losers into middle-management, groom under-performing Losers into Sociopaths, and leave the average bare-minimum-effort Losers to fend for themselves. The Gervais Principle differs from The Peter Principle, which it superficially resembles. The Peter Principle states that all people are promoted to the level of their incompetence. It is based on the assumption that future promotions are based on past performance. The Peter Principle is wrong for the simple reason that executives aren’t that stupid, and because there isn’t that much room in an upward-narrowing pyramid. They know what it takes for a promotion candidate to perform at the top level. So if they are promoting people beyond their competence anyway, under conditions of opportunity scarcity, there must be a good reason. Scott Adams, seeing a different flaw in The Peter Principle, proposed The Dilbert Principle: that companies tend to systematically promote their least-competent employees to middle management to limit the damage they can do. This again is untrue. The Gervais principle predicts the exact opposite: that the most competent ones will be promoted to middle management. Michael Scott was a star salesman before he become a Clueless middle manager. The least competent employees (but not all of them – only certain enlightened incompetents) will be promoted not to middle management, but fast-tracked through to senior management. To the Sociopath level.
  5. The minimum-effort Loser Stanley tells him coldly, “this here is a run-out-the-clock situation.” The line could apply to Stanley’s entire life. Stanley’s response shows both his intelligence and clear-eyed self-awareness of his Loser bargain with the company.
  6. The future Sociopath must be an under-performer at the bottom. Like the average Loser, he recognizes that the bargain is a really bad one. Unlike the risk-averse loser though, he does not try to make the best of a bad situation by doing enough to get by. He has no intention of just getting by. He very quickly figures out – through experiments and fast failures – that the Loser game is not worth becoming good at. He then severely under-performs in order to free up energy to concentrate on maneuvering towards an upward exit. He knows his under-performance is not sustainable, but he has no intention of becoming a lifetime-Loser employee anyway. He takes the calculated risk that he’ll find a way up before he is fired for incompetence.
  7. So let me introduce you to the main skill required here: mastery over the four major languages spoken in organizations. I’ll call the four languages Posturetalk, Powertalk, Babytalk and Gametalk.
    1. What distinguishes Powertalk is that with every word uttered, the power equation between the two speakers shifts just a little. Sometimes both gain slightly, at the expense of some poor schmuck. Sometimes one yields ground to the other. Powertalk in other words, is a consequential language.
    2. Another way to understand the difference between Powertalk and the other languages is with a card-playing analogy. In Powertalk, you play with valuable currency, usually reality-information. In the other languages, you are playing with no stakes. The most important enabling factor in being able to speak Powertalk is simply the possession of table stakes. Without it, whatever you say is Posturetalk. The only Powertalk you can speak without any table stakes is “silence.”
  8. Treacle is a vocabulary drawn from apparently win-win/play nice frameworks, but deployed with adversarial intent.
  9. So what is going wrong here? Why can’t you learn Sociopath tactics from a book or Wikipedia? It is not that the tactics themselves are misguided, but that their application by non-Sociopaths is usually useless, for three reasons. The first is that you have to decide what tactics to use and when, based on a real sense of the relative power and alignment of interests with the other party, which the Losers and Clueless typically lack. This real-world information is what makes for tactical surprise. Otherwise your application of even the most subtle textbook tactics can be predicted and easily countered by any Sociopath who has also read the same book. Null information advantage. The second reason is that tactics make sense only in the context of an entire narrative (including mutual assessments of personality, strengths, weaknesses and history) of a given interpersonal relationship. The Clueless have no sense of narrative rationality, and the Losers are too trapped in their own stories to play to other scripts. Both the Clueless and Losers are too self-absorbed to put in much work developing accurate and usable mental models of others. The result is one-size-fits-all-situations tactical choices which are easily anticipated and deflected. And the third and most important reason of course, is that your moves have to be backed up by appropriate bets using your table stakes, exposing you to real risks and rewards. A good way to remember this is to think of Powertalk as decisions about what verbal tactics to use when, and with what. The answer to with what is usually a part of your table-stakes. The stuff you are revealing and risking. If you cannot answer “with what?” you are posturing. You are not speaking Powertalk. In the Jim-Wallace example, Jim’s table stakes were his superior knowledge of the Michael-Jan story.
  10. You learn through real Powertalk conversations with other Sociopaths. Betting real stakes, like information, credibility, labor and literal dollars. You get played for a sucker a few times along the way before you wise up. Even if you are a kind Sociopath, you learn to swallow your distaste and occasionally play hardball when you have to.
  11. But if you do have the table stakes to join important conversations, and the mental toughness to play risk-and-reward games with every conversational move, there are a couple of skills worth practicing. The second skill is low-level utterance-by-utterance control, which is much harder. You cannot consciously engineer 7-8 meanings and calibrated amounts of power and leverage into every line you utter, through careful word choice.
  12. the depth of any transaction is limited by the depth of the shallower party.
  13. If the situational developmental gap between two people is sufficiently small, the more evolved person will systematically lose more often than they win. This is the Curse of Development. When you develop psychologically, and leave somebody behind, your odds of winning get worse before they get better.
  14. Well-adjustedness is a measure of the degree to which your worldview is socially acceptable and appropriate in a given environment. Since a messed-up personality can be well-adjusted with respect to a messed-up environment, well-adjustedness has very little to do with sanity and actual mental health. Environments and worldviews really come down to a series of situations and situational reactions. If your situational reactions are generally appropriate but against your best interests, you are a well-adjusted Loser. If they are both appropriate and in your best interests, you are a Sociopath. If your reactions are inappropriate (whether or not they are in your best interests – sometimes they are), you are Clueless.
  15. Here is the non-trivial stuff, compressed into three handy laws: Your development is arrested by your strengths, not your weaknesses. Arrested-development behavior is caused by a strength-based addiction. The mediocre develop faster than either the talented or the untalented. An alternative way of looking at these three laws is to note that defense mechanisms emerge to sustain addictions even when the developmental environment that originally nourished it vanishes. These then are the developmental psychology roots of the Gervais Principle. Recall that Cluelessness goes with overperformance. That overperformance is caused by arrested development around a strength, which has been hooked by an addictive environment of social rewards. Mediocrity is your best defense against addiction, and guarantor of further open-ended psychological development.
  16. Each pattern is based on a preferred, dominant variety of delusion: The Clueless distort reality. The Losers distort rewards and penalties. The Sociopaths distort the metaphysics of human life.
  17. To be an effective teacher at a given level, you need to have studied five years beyond that level. This has nothing to do with subject-matter expertise, and everything to do with trying to exit the Curse of Development zone.
  18. Status illegibility is necessary to keep a group of Losers stable. It is a deep form of uncertainty. I am not saying that there is a ranking that is just not known or knowable. I am saying there is no clear ranking to be known.
  19. Social groups grow from the illegible but stable center of the status spectrum, and leak at the legible but unstable edges.
  20. Remember, you are unique, just like everybody else. And everybody is uniquely above average. This is why, paradoxically, collectivist philosophies that value equality must necessarily value diversity. Nobody wants to be equally average. Everybody must be given a chance to be equally above average. Sociopaths detect and get wary of this dynamic very quickly:
  21. For the alpha, keeping contenders guessing through unpredictable signs of favor is the best idea. Exits work the same way. If an alpha or omega leaves, the new alpha or omega is plucked out of the illegible middle at that time. Not before. Succession planning may be a good idea in formal hierarchies, but it is a bad idea in social groups.
  22. Groups must remain socially fluid to work. Fluidity is the other side of illegibility.
  23. social skill, such as joke-telling ability, is a behavior whose effectiveness is determined by the reaction of a group. A joke is funny if the audience laughs. A proven mathematical theorem remains true even if a billion people scream that it isn’t. Theorem-proving is not a social skill in that sense. Like theorem-proving, social skills are information skills, since nothing tangible is produced besides an effect on others’ minds. Unlike theorem-proving though, the value of the product is based on social proof rather than objective proof. Social skills produce information; a social truth hypothesis (such as a joke). If it passes a social proof test, it becomes a piece of social capital, the grand narrative of the group. In other words: Social skills → Social truth hypotheses → Social proof → Social capital
  24. Most forms of humor attempt to raise or lower status of individuals via game-like structures, with defined roles and a structurally predictable script (the surprise comes from the content). There is always a jokester, a victim (which can be the same person by design or accident) and crucially, an audience. The victim may or may not be present. So there are at least three roles in a piece of humor, of which the role of audience may be played by a group. Sociopath jokes usually involve straight-faced delivery and private laughter, with no hint of mockery.
  25. Among the Sociopaths, status is irrelevant. Table stakes and skill at using them is what matters. Sociopaths pay attention to what you have, and how well you bargain with it. Not who you are.
  26. Clueless jokes are zero-sum, but Loser jokes are actually non-zero-sum. This does not mean they are win-win. This is a variety of non-zero-sum called mutual exploitation, that is sadly under-studied by game theorists. It simply means you can create net positive value by taking turns beating each other up competitively (aside for game-theory geeks: in the iterated prisoner’s dilemma, you get mutual exploitation by breaking the constraint that the cooperation payoff must be higher than the average of the defection and sucker payoffs). You can also create net-negative toxic non-zero-sum outcomes.
  27. Among Losers, in specific situations, status may go up or down, but overall, it just goes round and round. There is no grand status hierarchy. Only a top, a bottom, and an illegible middle. Newcomers attempt to successfully lose themselves in the middle. Situational wins and losses create a turbulent churn that maintains the illegibility without creating any decisive movement within the group.
  28. We’ve been drilling deep into social dynamics, and we finally get to that one deeply human quality that makes all this possible. It’s called empathy. The ability to feel what another human being is feeling. All this complicated social psychology does not need to be explicitly understood. For high-empathy people, all this is natural. By participating in collective feeling in groups of any size, and reacting to basic attraction/aversion drives, you can actually safely navigate all the complexity by instinct. Not only can you do this, you will actually feel good doing this. This feeling is called happiness. I don’t have time to go into this, but happiness is entirely a social phenomenon, and there’s plenty of evidence that the best way (and from my reading, the only way) to get happy is to get sociable. Non-social feelings that seem like happiness turn out, upon further examination, to be distinct emotions like contentment, equanimity or hedonistic pleasure. This isn’t particularly surprising. Our brains are designed like our bodies: just as we possess backs that others can scratch more easily than ourselves, our brains contain “backs,” so to speak. That’s where happiness lives, and is brought alive by empathic scratching.
  29. Why do we use the word “cringe” to describe the peculiar brand of humor in The Office? Think about the word. You cringe when you anticipate pain. Physical cringing, such as the cowering reaction you instinctively produce when you realize your car is going to hit another car, or when you realize somebody is going to hit you, serves to mitigate the anticipated damage. You also cringe via empathic anticipation of someone else’s impending pain.
  30. In this episode, Ryan is still not a Sociopath, so he cringes. Jan and David Wallace on the other hand, maintain an effortless poise no matter what Michael or Dwight get up to. To get there, they have to sequester empathy through detachment, and give up on happiness. We’ll see how and why that pact with the devil happens next chapter. In summary, seasoned Sociopaths maintain a permanent facade of strategic incompetence and ignorance in key areas, rather than just making up situational incompetence arguments. This is coupled with indirection and abstraction in requests given to reports. The result is HIWTYL (heads I win, tails you lose) judo.
  31. Loser group successes are effectively inflated, and blame discounted. So as Loser groups accumulate a history, internal valuations of earned credit are steadily inflated, and assessments of culpability run a deficit. A successful group systematically overvalues its capabilities and develops a blindness to its weaknesses. Sociopaths design the system this way because they are only interested in building an organization that lasts long enough to extract the easy value from whatever market opportunity motivated its formation. Expensive investments that will not pay off before the organization hits diminishing returns are not made. (It is revealing that the longest-lived businesses are family-owned – Sociopaths have an incentive to think long term if they intend to pass the business on to their progeny.)
  32. There are only three ways to get a bureaucracy to do anything it wasn’t designed to do: by stealth, with secret and deniable support from allies in the staff hierarchy; by getting air-cover from a sufficiently high-up Sociopath who can play poker with whichever oversubscribed Sociopath is in charge of exception-handling for the specific process (i.e. jumping the appeals queue and calling in favors to ensure the required ruling); and through corruption and bribery.
  33. That is what Sociopaths ultimately do with their lives if they survive long enough: generate amoral power from increasing inner emptiness, transforming themselves into forces of nature. As a side-effect, they also manufacture transient meanings to fuel the theaters of religiosity (including various secular religions) that lend meaning to lives of Losers and the Clueless. This meaning is achieved via subtraction, through withdrawal of complexities that the latter are predisposed to ignore, leaving behind simpler, more satisfying and more tractable realities for them to inhabit.
  34. Small minds discuss people, average minds discuss events, great minds discuss ideas. And in Jamesian solitude, Sociopaths find ideas contending in their minds. The creative destruction they script in the world of Losers and Clueless is mirrored by a creative destruction in their minds. This process creates power, but destroys meaning, especially the meanings of social realities. The result is increasing inner emptiness and external power. It is this very emptiness that allows the Sociopath to play hero for the Clueless and priest for Losers. Recall that Sociopaths create meaning for others through the things they subtract, rather than the things they add. This is something conspiracy theorists typically don’t get: manufacturing fake realities is very hard. But subtractive simplification of reality is much easier, and yields just as much power.
  35. Sociopathy is not about ripping off a specific mask from the face of social reality. It is about recognizing that there are no social realities. There are only masks. Social realities exist as a hierarchy of increasingly sophisticated and specialized fictions for those predisposed to believe that there is something special about the human condition, which sets our realities apart from the rest of the universe. There is, to the Sociopath, only one reality governing everything from quarks to galaxies. Humans have no special place within it. Any idea predicated on the special status of the human – such as justice, fairness, equality, talent – is raw material for a theater of mediated realities that can be created via subtraction of conflicting evidence, polishing and masking.
  36. To turn status-seeking into a control mechanism is to devalue status. To devalue something is to judge any meaning it carries as inconsequential. In terms of our metaphor of masks of gods, the moment you rip off a mask and wear it yourself, whatever that mask represents becomes worth much less. So the Sociopath’s journey is fundamentally a nihilistic one.
  37. The major theme of Office Space, unlike The Office, is not deciphering and navigating the gridlock on the road to power, but exiting the rat-race altogether, to a state held up as an ideal of freedom: exile.
  38. The only true exit is to a freer mind. The only true state of happy exile is one which allows you to penetrate the social fictions that surround you, whether you remain within a cubicle or build a life around Burning Man.
What I got out of it
  1. Fun read showing why and how The Office is so funny and cringe-worthy. Organizational literacy is a great filter to have in your arsenal – Sociopaths, Clueless, Losers make up the typical hierarchy