Marketplace All-in-One Big Tech pivots from the carrot to the stick
May 27, 2025
In this engaging discussion, Alistair Barr, author of the Business Insider Tech Memo Newsletter, dives into Big Tech's shift toward stricter performance reviews. He highlights the dramatic departure from the lavish perks of the past, driven by a new focus on productivity and AI. The conversation touches on the implications of Microsoft's toughened evaluation processes, Google's competitive compensation strategies, and the controversial use of block lists. Barr sheds light on how these changes are reshaping not only tech employment but the entire industry landscape.
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Stricter Tech Performance Reviews
- Big Tech firms like Microsoft have toughened performance reviews, borrowing methods from Amazon's harsh evaluation systems.
- Low performers may enter improvement programs and risk losing pay or exit if they don't improve.
Google's Budget-Neutral Rewards
- Google boosts top performers' compensation but makes the system budget-neutral, cutting funds from lower performers.
- This approach sharply distinguishes between high and average or struggling employees through carrots and sticks.
End of Rest and Vest Culture
- Silicon Valley employees often "rest and vest," coasting while waiting for stock options to fully vest.
- This cultural habit is now ending as companies demand higher performance and less complacency.