Magazine article Management Review

Stemming the Entitlement Tide in American Business

Magazine article Management Review

Stemming the Entitlement Tide in American Business

Article excerpt

Stemming the Entitlement Tide in American Business

This company is just like one big family."

Chances are, whenever you hear people say that, they're talking about a company that is stuck in entitlement. They're commenting on the warm sense of belonging, but unconsciously they're also talking about no having to earn their place. In the family at work, as in the family at home, entitlement means you belong, and you benefit precisely because you belong.

Expressed simply, entitlement is the result of too much generosity. We give people what they expect and we don't hold them accountable for meeting criteria of excellence. In business, it commonly happens because managers are unwilling to do the work of requiring work. Frequently it's because they want to avoid discord and bad feelings. Very often it arises from pity: "We don't hold people accountable for results because we don't think they can perform." Good performance, poor performance, or no performance are all treated the same. In the workplace, people feel entitled when they have so much security that they don't have to earn their rewards:

* They keep their jobs and collect their paychecks whether they produce much or little.

* They get their annual raises regardless of their contribution during the year.

* They are promoted because they have the right amount of seniority, not because they have demonstrated their competence for the higher-level job.

* They receive a year-end bonus because it's the end of the year, not because they've made notable achievements.

When people don't have to earn what they get, they soon take for granted what they receive. The real irony is that they're not grateful for what they get. Instead, they want more. It becomes a terrible cycle.

These issues apply not just in terms of lower-level workers; entitlement often runs through the highest ranks to the executive level. That's what we see when large corporations (General Motors was one) freeze wages, lay off workers and give executives big bonuses. The same thing happened in some of the savings and loans that were taken over by federal administrators: They were losing money like crazy, but they were giving top officers hefty bonuses. Too often, there are no market forces operating at the highest level - executives get perks and bonuses irrespective of company performance - so the company operates primarily to benefit those who run it.


"I've worked here a long time and have done what you expected. I've earned my security." That is the working presumption of the majority of people who work in our various government bodies, in all levels of our schools, in our large and powerful unions and in our mature and prosperous corporations. It amounts to total job security. Too much security is what entitlement is all about.

Some groups of people (school teachers, for example) have formal tenure. They set a precedent for others to successfully argue their right to have the same certainty. In recent years those precedents became transformed into court decisions so that it became legally difficult to fire employees.

Under the old common-law concept of employment at will, the company had all the power; managers could fire laggards on the spot. Today it is very difficult to fire someone without running the risk of legal counteraction. As of January 1989, courts in 46 states have issued rulings that erode the doctrine of employment at will, and at least 13 states now recognize a vague principle known as the covenant of good faith and fair dealing, which says that each judge is free to decide whether or not an employee was fired without adequate cause. Employers cannot fire employees without reasonable cause - for example, a reduction in force, unauthorized absenteeism, misbehavior or failure to perform. For lawyers, this is proving to be a major windfall: A typical wrongful discharge suit in California, for example, awards damages of $700,000 if the employer loses. …

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