What you can end up with is a lot of new hires queued up for the firing line. The “bottom 5%” is, initially, the people in the office who are currently in a slump. But then you bring on a load of fresh new hires who have little experience and a lot of pressure. They burn out fast and become the next “bottom 5%”.

Meanwhile, the more politically and technically savvy learn to survive by creating make-work tasks that look good on performance metrics but do little for the firm as a whole. Their superiors approve, because a team that is constantly appearing busy is more important than a team that’s producing anything of value. So you end up with these little entrenched departmental fiefs, dedicated to making themselves irreplaceable at the expense of the company as a whole.

There’s a ton written on the Sears collapse in the early 00s, where this exact dynamic played out. Managers turned against one another, because stack ranking mattered more than inter-department cohesion or bottom line figures. The company went from a network of high end retailers to a shitty outlet stores over the course of a decade.