Should Business Leaders Experiment to Overcome the Shortcomings of Meritocracy?

A number of high-profile business leaders have promoted their fierce adherence to meritocracy in their attempts to distance themselves from diversity, equity and inclusion (DEI) principles. In June, for example, Scale AI founder Alexandr Wang posted to X about his company's embrace of a similar acronym to drive hiring policies, MEI, which he said stands for "merit, excellence and intelligence." In an email to employees he included with the post, Wang insisted, "Scale is a meritocracy, and we must always remain one." His stance earned cheers in the comments section from the likes of Twitter owner Elon Musk and Oculus VR founder Palmer Luckey. 

At its core, meritocracy is meant to elevate people for roles and promotions based solely on their abilities. But experts like Stuart McCalla, managing partner at the leadership coaching, consulting and investment firm Evolution — and many commenters on Wang's repost to LinkedIn — say it isn't always so straightforward. 

"I understand it, and if it was true, it would be a great thing. It would be a wonderful thing if everybody was judged on their abilities, skills and achievements," McCalla said. "But what skills, what abilities, what achievements, and who's doing the judging? And of course, that's where meritocracy breaks down. If you're saying that you are dealing with a meritocracy, or that you are wanting to embrace meritocracy as an ideology, then how do you know the merits you're basing your decisions on don't have bias in them? Forget about unconscious bias. Human beings have cognitive biases, and cognitive biases are regardless of race, culture, ethnicity, orientation and ability."

For example, research shows that most managers — even those with sincere intentions to select the best candidate — tend to hire and promote people like themselves, a type of cognitive bias fittingly known as the similar-to-me effect. This natural human inclination can also creep into the way companies shape seemingly objective requirements for roles and promotions, as leaders intentionally or unintentionally set parameters around degrees, skillsets and experience levels that mirror their own. 

"I love when I see a LinkedIn job posting that says you have to have an MBA from a certain school. I'm like, why from this school? It's frustrating to see that level of disconnect in people's minds," McCalla said. 

Overcoming the flaws of meritocracy with experimentation 

Meritocracy is closely linked to individualism, but in order to the build the type of inclusive culture that drives better financial performance, McCalla says organizations need to pay more attention to the group. 

"Let's think about a collaborative model instead of a meritocracy. Let's all get together, whoever's in the room, and let's hear some of the inputs that make anybody within the organization successful," he said. 

Many leaders may read that and think it's cryptic: Okay, but practically speaking, what does it even mean? The answer isn't so simple and will be different for different organizations and different workplace cultures. 

"People want to go by a [set] playbook, but there's no right or wrong way to do this, so let's experiment our way to coming up with the right thing," he said. "Organizations that can do that end up having a much better experience because not only do they expose their own cognitive biases, their own belief systems that may be holding somebody back, but they also end up learning together as a group, which is way more powerful than the individual. We tend to celebrate too many individuals, and we need to start celebrating teams." 

McCalla and other coaches at Evolution often lead the organizations they work with through an experimentation framework with the aim of creating workplace cultures where everyone feels included and empowered to grow in their careers. 

This could mean creating space for more employees to speak during all-team meetings or establishing employee resource groups (ERGs) where staffers of similar backgrounds can convene with each other. Or it could expand into more involved projects that seek to address how organizations recruit, hire and promote employees. 

One company, for example, realized it consistently sourced young talent from the same colleges and expanded recruitment efforts to historically Black colleges and universities (HBCUs) as a way to diversify the hiring pipeline. Others moved to replace degree requirements with skill-based assessments to determine if someone is qualified for a job, or looked to source talent from organizations like Next Chapter, which trains people in software engineering while they are incarcerated. 

"Skills are more important than prestige degrees," McCalla said. "Next Chapter is an incredible example in my mind of taking people who would be considered 'less than' or 'not smart' and using skill-based assessments to give them opportunities. The course of their lives change drastically, because now they have access to a skill that is in demand and incredibly lucrative."

While much of this work is organizational, individual leaders will often find themselves feeling more comfortable talking about DEI and interacting with diverse colleagues through the process, McCalla said. 

"There's joy at the end of this," he told us emphatically. "What we get from a lot of the organizations that have persisted with this is a lot of ease. 'Oh my God, I can talk about this stuff. It's easier. I can talk to my ERGs, I can talk to my senior leaders who are diverse and empathize with their experience and feel like I'm not afraid to have deep human connections.' And what happens with that is that then teams feel closer, they feel more connected."

It's not just for organizations: How professionals can experiment their way into the roles they want

Experimentation isn't only for organizations. Professionals can also leverage this mindset to take command of their own career trajectories. "For myself, I started my career in printing ... and that's what got me into tech," said McCalla, who worked in coaching roles at Salesforce, Ticketfly and Lumos Labs before joining Evolution. "I knew I was behind the eight ball in a lot of ways, so what I was determined to do was to experiment my way into getting positions that I wanted." 

McCalla's journey from an IT consultant at an NGO publishing health guides to an executive coach for some of the most prominent leaders in tech and business is one he encourages other professionals to follow and make their own. 

"A way for a lot of individuals to break into companies and systems is to experiment your way in. Try different things, see what happens, don't be afraid of rejection. Over time, you'll figure out the right path for you," he advised. "It's a great antidote to the shadow side of meritocracy, which is: I believe you can only achieve something if you look a certain way or you come from a certain school or you have a certain pedigree."

The bottom line: Change is challenging, but it's inevitable 

Creating more diverse teams and empowering them to thrive is proven to drive business outcomes. Skills-based assessments, for example, are five times more likely to result in hiring top performers compared to hiring based on degrees, according to research from McKinsey, and analyses continue to show that diverse teams perform better overall. But companies are faced with internal and external limitations that can hold them back from doing this work effectively. 

"We have examples of brands who tried things that have gotten backlash," McCalla said. "A lot of companies are also facing burnout and change fatigue: 'Why should I even think about this? I just want to do my job and go home and make money and have my kids,'" he explained. "So, businesses are saying, 'We don't want to worry about that stuff.' But the thing I tell them is that your staff, your employees, are being affected by this, and then they're coming into your business and they're fighting, ignoring, whatever it is. Business is a force for change, so think about it."

Considering Generation Z is the most diverse generation in history and places higher value on corporate diversity efforts, the momentum driving companies to become more inclusive is not going anywhere. Beginning the hard work today, and learning and iterating as you go, can better position companies for the future, McCalla said. 

"If I could offer anything to the businesses coming up, it’s to understand that we're 24 years into the new century, and the ways businesses were run in the last century cannot work in this new world. We're facing multiple existential crises, and everything's connected, and systemic oppression and DEI are among them," he concluded. "Of the companies we've been dealing with, some have stopped their DEI practices, and it's the companies who see it as more than the phrase 'diversity, equity and inclusion' — but really this idea of ending systemic oppression — that are persisting and continuing."