The Way the World Works, Pt 1: Three Tiers of Organization

• by Gitabushi

Okay, I realize there’s more than a little hubris in the title.

I guess I have wanted to be a kind of Jordan Peterson since long before Jordan Peterson was a thing. My goal is to do my best to understand life, to figure out what the most basic rules of human nature and human interaction are, and then write them down and share them, for others to evaluate, and use or reject as they see fit.

I relish the idea of helping others.  I want to help everyone have a better life, to the best of my ability. I hope others can learn from my mistakes, and what I’ve learned from my mistakes, without having to make those mistakes themselves. My intent is to help make the world a better place to some degree.  And, of course, my ability to analyze and reason is, to some degree, validated by those who are helped by my writings.

So there’s some ego involved. But I hope you can ignore that and find something helpful in my posts.

I think the main points of this topic should be pretty obvious to anyone who spends any time thinking about it at all.  Pessimistically, that means it isn’t obvious to most people.

[sigh]

Here is the point:

Every organization has three main tiers: crew, crew chiefs, and leadership.

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Crew could also be called labor, or workforce.  These are the people doing the work.  There often isn’t much thought involved in this.  The work doesn’t require much ability.  It is a skill that can be taught to sufficient competence to just about anybody.  This is where the value of what they are selling or providing is actually created.

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Crew chiefs could also be called middle management, and I’m sure there are other terms, as well.  Crew Chiefs are leadership, but still distinct from leadership.  This tier is often made up of senior crew/labor individuals who have been promoted, but not always.  They are in charge of the labor.  They resolve disputes, enforce rules, ensure quotas are being met, oversee quality, train the new employees, and handle welfare of the labor force.

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The leadership tier comprises those who make decisions.  When an organization grows to any size at all and obtains a geographic spread of any kind, there are also usually three tiers of leadership: Local/unit leaders, regional/group leaders, and executive leaders.  The executive leaders set the direction for the organization.

Digression: I figured this out when I became an officer in the US military.  There is a great deal of resentment among the enlisted in the US military against officers, for multiple reasons.  The enlisted see that their lives are more at risk, that they do all the hard work, but officers get paid so much more.  They see that junior officers often seem incompetent and depend on senior enlisted to avoid basic blunders, yet still get paid as much or more than senior enlisted.  They also get the impression that officers get away with things that enlisted get punished for.

Some of these things are true.  Being me, I had to analyze why.

The answer isn’t simple, though. To some extent, the resentment that officers get away with things enlisted get punished for can be correct.  But it is also true that if the offense is serious, the same act that will ruin an enlisted individual’s career will put the officer in jail. And that the same offense that will delay a promotion for an enlisted member will get an officer thrown out of the military.  The level of responsibility between the tiers is different.

The thing is, as I pointed out, the labor tier is easily replaceable.  Training isn’t that difficult, the tasks aren’t that difficult.  95% of the world, or more, can do it.  The separation of tiers into labor, middle management, and leadership isn’t intelligence, it isn’t ability, and it isn’t even education.  It’s about effort, risk, and preparation.

Anyone can enter the labor force.  Just show up and ask.  They always need labor.

To get to middle management, though, you have to work for a number of years and be the best of the labor.  You are chosen by the leaders to be a crew chief based on standing out.  That means you need to put in some extra effort, and you risk having that extra effort wasted if you aren’t chosen, but that’s about it.

Labor gets paid for what they do. They do the work, they make the goods, but how well they do really doesn’t have a huge impact on the future of the organization. If someone does their job badly, they will be replaced.  But they’ll be given a bunch of chances to fix their issues first.

And the laborer can screw around for years before deciding to try for middle management, and then they are judged based on what they do at that point.  Admittedly, for the most part…there are times where egregious past behavior will carry over, but most of the time, if you make a change, you are judged based on having made the change.

The leadership tier, however, is different.

First, you must apply to join the leadership tier, and they don’t accept everyone.  That means you have to first figure out they are looking for, and then acquire those attributes early, while the labor tier is taking it easy and enjoying their paycheck on the weekend.  Then, if accepted, you are being watched from the beginning. As more people have recognized leadership tier is the way to a good life (and as the quality of life at the labor level has, if not actually declined, then at least fallen behind the leadership tier), competition has increased and the Zero Tolerance for Screw-ups factor has increased.  In leadership, you are held responsible for everything those under you do, good and bad.  You are expected to lead, and fix problems before anyone above you in the leadership tier hears about it.

As you rise, you are able to take credit for your increasing middle management and labor force output, but you are also held responsible for any of their problems.  And you are sometimes scape-goated for even normal or unavoidable failures.

If you do everything correct, avoid any blunders at all, work extra hours beyond the 40 hours/week (minus break time) that is all that is demanded of labor, you might get promoted to the middle tier of leadership, and even the executive tier.

At the executive tier, you are held responsible for the performance of the organization, regardless of competition, government, the strength of the economy, the declining of the market, etc.

That’s why CEOs get paid so much: there are so few people who can qualify, because too many people have one stain or another on their record that means they are an unacceptable choice to be in the executive tier.  And so the stress and pressures make that level of pay necessary.

Sure, you’re saying right now, I’ll take that pressure for half that kind of money.

I’m sure you would.  But were you prescient enough to make the sacrifices and choices early enough in life to be on an Executive Leadership track?

And that’s where most people disqualify themselves.  To them, it was more important to have freedom, to have weekends off, to get paid for overtime and/or to not work overtime in the first place.

By “them”, of course, I include me.  As a young officer, already behind the 8-ball for executive leadership by being more than a decade older than other officers of the same rank, I was unwilling to “play the game” of getting face time with the commander, or of picking my assignments based on what would work best for my career.  No, I had to think about what jobs were interesting, or where I wanted to live.

I’d call myself stupid for that, but it isn’t, really. It was just a choice.  Because (write this down): There are always more qualified people for a job/position then there are jobs/positions available.

It is exhausting to put your career first.  You have to sacrifice so much to do it. Most people don’t even realize when they are self-eliminating for top-tier life opportunities. I think this is because I think there is little to no effort made in our “education” system to teach people how the world really works.  We tell kids “you can be anything you want to be” and then we don’t take even the first step in teaching them how to achieve those dreams.

We can tell kids they can be anything they want to be by holding up role models, and ignoring (or even concealing) the survivorship bias aspect of who gets to be an astronaut, or CEO of Citibank.

All this may seem obvious, but too few really understand this, and my evidence for that “too few” assertion is not just the resentment of enlisted for officers, but also in the continued existence of Socialism (and Democratic Socialism) as a philosophy.

Socialism recognizes that the tangible value is created in the labor tier, but then concludes that this gives the labor tier power that they are forgoing or being cheated out of.

Which is stupid.  The minute you being making decisions about labor, product, etc., you aren’t in the labor tier anymore, you’re leadership.  And you there’s a broad pyramid there: it’s easy for 3-4 people to make decisions about the number, color, and type of widget you’re making, or if the style of service provided needs to go after a different market share.  It is impossible for the 300, or 3,000, or 300,000 labor tier individuals to make a decision on that without it being a 300,001-legged sack race.

The only thing Socialism accomplishes is letting its advocates jump to leadership tier without the experience or ability to be good at it.

Anyway, if you already knew the basics of the three tiers, I hope I at least gave you some new implications to think about on this topic.