In a small organization, everybody cares about now it is doing. After all, it cuts their paycheck, so all the employees have a direct incentive to care for it. But the bigger an organization becomes — and this is equally true whether it is private or public — the less important its immediate survival becomes to each employee. Its continuity and health is more and more taken for granted as the prospects of bankruptcy become ever more remote. Instead, what looms larger and larger in everybody’s mind is their individual place in its hierarchy. It is much more lucrative to be an executive in a large ailing company, than to floor sweeper at a corporate success story.

This leads inevitably to the flourishing of a particular type of creature: the corporate climber. This person doesn’t give a whit about how the outfit he works for is doing, but is solely focused on the next rung in the org chart. The proliferation of corporate climbers is a problem for all organizations that are successful for too long. The danger is magnified because the company can do well for a long time – coasting on its laurels – before the moral rot becomes apparent. Unfortunately, often by the time it is noticeable, not only will the CEO have become a self-interested striver, but also was the man he replaced, and the man that man replaced.

The best example of this is Rick Wagoner, the former CEO of General Motors. He ran the company from 2000 until its bankruptcy nine years later. In 2007 – the year before bankruptcy — his salary was $1.5 million, with a total compensation of $14.4 million. After the company failed, he retired with an exit package worth $10 million. In other words, if the rot is deep enough, it doesn’t even matter if the organization fails completely; the man most responsible for its failure will still draw generous benefits.