"The longer a person stays at a particular level in an organisation, the more most measures of their performance fall - including subjective evaluations and the frequency and size of pay rises and bonuses. It is a finding entirely consistent with the idea that people eventually become bogged down by their own incompetence."<p>That's a conflation of cause and effect if ever I've seen one. It's also entirely consistent with the fact that people who don't get promoted (the majority, given the pyramidal structure) are stuck and get fed up with their jobs as they aren't challenged any longer.
This reminds me of <i>First, Break All The Rules</i> (see <a href="http://www.amazon.com/gp/product/0684852861?ie=UTF8&tag=randomobser0b-20" rel="nofollow">http://www.amazon.com/gp/product/0684852861?ie=UTF8&tag=...</a> to get the book). They point out that many promotions require different skills, and that sometimes works badly. This is particularly true when people are promoted to manager.<p>To avoid this problem they recommend giving people promotion possibilities within job roles <i>AND</i> requiring that moving into management always come with a pay cut to make people honest about whether they are seeking the job because they think they would be good at it, or because they want a raise. (A manager who is good would likely make up the pay cut with interest over time.)
They've shown that random selection is good when there's zero correlation between performance at level N and level N+1.<p>Personally, I'm more interested in what happens if the correlation is non-zero, and performance at level N+1 has more impact than performance at level N? How does the best promotion strategy change as the level of correlation and impact of being higher up the ladder changes?