I just can't believe how or why they are continuing with the system when it is clear this is counter-productive and is hurting the company in many ways. What possible reason can there be? There is no way I would ever want to work in that kind of an environment.
Is there another side of the story? Can someone from Microsoft shed more light on this?
Before I agreed to work at Microsoft I asked the HR people about it. They felt this was a great system because a company with ~100K employees was bound to fit a bell curve regardless of its ability to hire and retain "the best". They told me the five buckets only had to meet their expected quotas at the level of Steve Ballmer, so it absolutely was not a zero-sum game as some had alleged.
I haven't seen a full year cycle applied to myself, but the one period I did participate in didn't quite work that way in practice. In reality, the zero-sum gets enforced much lower in the company than Ballmer himself. Exactly where probably depends a lot on what division and team it is.
Neither have I seen evidence of the claimed worst effects of this type of system. Instead I saw great people take a hit for the team, rather than retaining underperformers for this purpose. Who knows, maybe in some ways this is just as bad.
Every big organization needs some kind of system and there are certainly worse ones. This system is effective in allowing the company to promote some people, keep some where they are, and move some out.
But it would be nice if the current shuffling at the top became an opportunity to bring in something better.
> They felt this was a great system because a company with ~100K employees was bound to fit a bell curve regardless of its ability to hire and retain "the best".
This isn't true at all. If you have the ability to hire and retain the best, then the company curve will look like the rightmost extremity of a bell curve, which has rather different properties compared to the entire curve. As I understand it, this is why baseball statistics value players in terms of "wins above replacement" instead of "relative to the average player" -- the average player is so much better than the majority of professional baseball players that it's not useful to assume in your tooling that you could hire one. (Whereas, if you have the entire bell curve, then the average person is both median and modal, and is therefore easier to find than a person at any other level.)
Disclaimers -- I don't know statistics, corrections very welcome.
The recruiters did indeed lie to you about the size of the buckets and how far up they went. They say they try to keep things statistically significant, but the number of people in my band was pretty low, and it was clear that some good people were going to get screwed.
Something is wrong when you are shafting great people in one part of the company while promoting knuckle-draggers in another. Part of Ballmer/Brummel's trouble is that they couldn't seem to recognize who was honestly contributing versus who was parasite, or an under-performer, or someone toxic who was pushing out good people to serve their personal gain.
Is there another side of the story? Can someone from Microsoft shed more light on this?