If you hire someone to solve problem X but they get sidetracked and spend all their time on problem Z instead... they can be excelling at driving solutions and still be doing the wrong thing in the eyes of the company.
Caring about completely different things than your boss can get you in trouble even if you excel at everything you do.
That said managing a large organization is extremely hard. I don’t think most companies have the overall business dynamics to sustain a large company where teams can do things that don’t matter. Usually those companies, which there are a lot in the tech world, have something else going on (no product market fit and too much cash) that leads to those symptoms
I mean, it's worse, IME, it usually slows down the rest of the org.
But it is worth mentioning in the discussion of "why should I care if my employer does great or not when there's no direct reward in it for me" - otherwise you could just wave that whole question away with "that's just bad management" more generally. Yet it's mathematically implausible to suggest that everyone can escape bad management; some number of managers are going to be subpar, so the situation remains relevant to people.
To your other point, I wasn’t trying to be as hand wavy as that came across.
There will always be people who make mistakes or are not good fits for their job (engineers, management, execs, investors, etc).
Maybe a better way to say it is that low impact work happens at the tail end of bad management. It’s usually a luxury problem (pet projects from a company that makes too much money but has too little maturity) or a symptom of terrible management (no clue what is valuable or worse unable to actually get team to work on what is valuable)
And what is the company doing in exchange for these people? Extra Compensation? Extra promos? Extra Vacation time?
Or is the company just subjugating people with bullshit performance reviews, PIPs, canceled bonuses, dangling promos?
If you aren’t actually and truly in the A group then your company is thinking about how to pay you less, replace you eventually, or invest in other people who likely will become part of the A group.
How can management guarantee that an A player is evaluated and rewarded correctly? What controls does the company have to prevent B-level management from hurting A-level workers?
And why does he think that A employees will continue to be around if this is the game?
Do you compensate these people? Why should I be this person if you don't pay me for it?
So the job of management is to weed out people who aren’t having as high as possible impact when convenient.
I don’t like it, but it’s often what’s going on
"Market dynamics" force you to pay your highest performers barely more than your lowest performers?
How exactly does that work?
Disparity between executive salaries and worker salaries are astronomical, but when it comes time to reward your highest performing workers you can't find any possible way to increase their take home? Between salary, bonuses, stock grants, retirement plan matching or any other possible methods of compensation, your hands are absolutely tied? Because of "Market Dynamics and Pay Equity"?
Come on.
A) The most valuable people can notice problems, find solutions and get it done (either themselves or by articulating a pragmatic plan).
B) People that show up and dependably are very important until someone cheaper makes more sense.
The rat race at any job you have is evaluating where between A and B you want to achieve your career goals.