Next Version of ChatGPT

Previously, people used to comment about me that, if anyone asks me one question, I ask them back 10 questions before answering their question. 

Even if I get a simple question like, "How to go to Guindy Bus stop" from anyone at Guindy Railway Station, I do not answer without asking a question to that person. 

The reason I ask questions for any question is, I would prefer to give an efficient answer or solution for their problem. A question may have multiple solutions, but, we have to pick one good solution based on the circumstances and others. If I know all the related things about that question, then I can pinpoint one accurate solution that is most suited for that situation.

I would like, if ChatGPT can do the same way. If I ask an abstract question, it assumes many things and tries to give some solution. But, it should ask questions about that problem to get the exact situation, and based on the detailed problem, it should give appropriate solution. 

[Guindy is a pretty big area in Chennai. It has three bus stops on three sides of the railway station. If anyone asks "How to go to Guindy Bus stop", one should ask their next destination from Guindy Bus Stop, and redirect to the appropriate bus stop out of the three. If anyone points them to a random bus stop, and if that is not the correct bus stop, one may have to walk half a kilometer to the other bus stop. There were a few times when I got irritated with others, when they interrupted my questions, and gave a random answer to the people.]

[Nowadays, people are not commenting me much, may be due to either Respect or Fear or both. But, my attitude of asking questions did not change.]

Meesala Saibaba, Loksatta Party

 

Meesala Saibaba garu is a low profile leader who contested in 6 elections for Corporator, MLA, MLC and MP from Loksatta party and as an Independent. He worked for Loksatta party initially, and after Loksatta Party stopped contesting in the elections, he contested in the elections as an Independent by taking Loksatta Party symbol (Whistle).

When I met him first time, I never thought that he would go on contesting in that many elections. 

He always used to say that, he does small small things. He never did any big things like other leaders. Because of that, I never expected him to contest in any election. But, he showed how does one achieve bigger goals by taking baby steps. 

Sadly, he left us too early. 

Husband Like Rama or Krishna

This post is NOT for spiritual interpretation.

Many people say, they would prefer husband like Rama and not like Krishna.

Rama has married only one woman. 

After Sita was captured by Ravana, Rama accepted her back only after she entered into fire. 

When one citizen of his kingdom talked bad about Rama, he sent Sita to forest, when she was pregnant.

Krishna married 16,108 women.

16,100 women were initially captured by Narakasura. After killing Narakasura, Krishna married all of them.

He gave equal importance to all his wives and has taken 16,108 forms to take care of them.

Krishna never left anyone who has surrendered to him.

If a woman wants a person who can take care of her well, then she should ask for someone like Krishna. 

If a woman wants a person who does not look at other women, even if he does not take care her well, then she should ask for someone like Rama. 

The reason why Rama has done like that has many reasons behind. This post is not for interpretation in those lines.

Astrology - Basic Criteria for the Predictions

Once an astrologer said, there is going to be a big fire in the next few days. 

After a few days, he said, there was a big fire in Pakistan, and he claimed his predictions were correct.

This made me think of the evaluation of a prediction. 

What I feel is, for a prediction to be of some sense, by following the prediction, we should be able to take some decision or change a decision or atleast give more or less confidence in the decision that we are already taking. If it does not give any of them, then that prediction is useless. 

Once I went to Mumbai and it rained a lot. All the trains and flights got cancelled, and there was a lot of water on the road and travelling even by the road was not possible. I faced a lot of difficulties, cancelled all my plans, and it costed me a lot. If someone had predicted that I would face difficulties if I go to Mumbai, I would have saved a lot of money. 

That prediction does not need to be from an astrologer who looks at Horoscope charts or palm. It can be somebody who can look at the weather report of Mumbai, and who knows that, whenever there is a lot of rain, Mumbai would be flooded and the trains would be cancelled. 

It does not matter how I get the predictions. By that prediction, I should be able to take a decision or change the decision or should change the confidence level of the decision that I was taking. 

Is it Scientifically Proven?

If someone claims that they found a cure for a disease in any method other than allopathy, immediately, many people will start questioning the scientific validity of that. Many times, they go to any length to unpopular them.

Many people miss to ask a very basic question. What is the side-effect, if one uses that? 

Many many years back, one of my friends suggested to drink water in the morning before eating/drinking anything else. Do I have to consult doctors whether it is scientifically proven or not? Do I have to wait till scientists research on that and publish a paper proving or disproving that? If they disprove that, should I stop drinking water in the morning? 

How do all those things matter to me? I did not see any harm in doing that, and I drank for a few days. I saw significant improvement in that, and since then I have been drinking water in the morning before taking anything else. I have been continuing that for many many years and planning to continue life long. 

If someone is having a fever, then what I suggest to them is, don't eat anything, drink a lot of honey water, and sleep a lot. If someone is having a fever, they won't feel like eating anything. If I am saying, if you are not feeling like eating, don't eat. But, to get energy, drink honey water. What is that person going to lose by following that? Does it require an approval from some scientist in Harvard University?

When someone suggests something, before even asking whether it is scientifically proven or not, one should ask, What would I lose if I do that? 

Let's say, someone suggested you do something which would take one hour of your time and costs Rs.100 and no other loss. If you have some respect for the person and are ready to spend one hour of your time and Rs.100 for that person, then you can do it for the sake of that person, if not for the advantages that were proposed.

If someone is asking you to take a tablet that is made up of chemicals, then we won't know what can happen by taking that, and we can ask whether it is scientifically proven or not. But, if someone is asking you to prepare something by using the materials that are available in your kitchen (Which you bought for your consumption in different food items), and asks you to prepare in some way to recover from a specific disease, what is the harm in trying it? Why do you need scientific proof?

Public vs Government Organizations

In a private organization, a vision is set for the organization. To achieve the vision, the organization would employ people with appropriate terms and conditions.

In a government organization, the employees would set a personal vision for themselves. The employees would expect the organization to work towards achieving the personal vision of the employees. In case the organization does not do that, the employees and/or prospective employees may fight and even destroy the public properties.

Speak only Truth

Whenever I hear, "Speak only Truth", I always feel uncomfortable. 

If someone asks me, how much salary am I getting, why should I tell the truth? I don't want to tell how much I am earning. Most of the time, I generate a random number and I tell that number. 

If anyone still says, I should speak only the truth, then I would like to ask a few questions and get the truth from them.

What is the username/password of your internet banking account?

What is your email password which is linked with all your social accounts?

Can you tell me the OTP that you have just received on your mobile?

Some time back, when I was doing one transaction with a person, that person asked me to tell a lie to the middleman, so that the brokerage would be saved. I refused for multiple reasons. Main reason was, I need that broker for my future transactions and if there is any breach of trust now, I won't get any favorable deals later on. 

In another case, I forced one person to tell a lie to the middleman, so that I could save the brokerage. [I paid the brokerage for the initial contract, and wanted to avoid brokerage for the extension of the contract.]

In a few cases, I refused to tell lies, because the lie is not convincing. 

In a few other cases, I did not tell lies, because I did not have answers for the follow up questions that may come.

There was at least one instance (there might be more), when I told the absolute truth, but I tried to tell in such a way that, everyone thought, it was a lie. 

Whether I tell lies or truth depends on multiple things. Don't expect truth from me. 

Since, it is not going to benefit any of us, it should not be done.

I heard the following statement from many people in many different situations.

Since, it is not going to benefit any of us, it should not be done. 

My response used to be, what are you going to lose, if it is done? Since I get some benefit out of it, this needs to be done. If you are going to lose anything out of it, then we will discuss that and see how we can resolve that. 

Of course, Till now, I could never convince the people who said that. [Eventhough they were not going to lose anything.]

What are we doing to the society?

Sometimes I used to wonder, whether I am doing anything for society or not.

Then, I realized that anyone who earns the same or more than what they consume is useful to society.

Many people are getting employment because you are alive and consuming. Even if you are living with basic necessities, you would be consuming food and other groceries, you might be travelling by bus or train etc. To provide those facilities to you, someone is getting employment (even if it is a fraction of their total employment).  

If you are a rich person who splurges money on many things, then there would be many people living on you. Without you, the total employment would reduce. 

Apart from that, I pay a lot of income tax. (It is not my problem, if people don't vote for good candidates for the efficient use of that money.)

It just happens like that

Many times, I traveled by Tamil Nadu express from Chennai to Vijayawada. The train reaches Vijayawada at 4 AM. I always used to get up before the train reached Vijayawada even without an alarm. I used to think that it might be sixth sense or that the mind has some internal alarm. 

I was under that illusion till I missed the station one day.

Then, I analyzed everything and found the answer. 

Indian railways typically allot coaches for a particular start and end stations (for sleeper class). For someone starting at Chennai and getting down at Vijayawada or Warangal, they get only the coaches reserved for that. Similarly, for someone traveling from Chennai to Delhi, they get different coaches and they rarely travel with someone traveling to Vijayawada. 

Whenever I travel to Vijayawada, there would be many other people traveling to Vijayawada. When some of them get up and start talking or switch on lights or because of some other disturbance, I also get up. I used to think, I got up myself. 

Once I booked a ticket from Chennai to Delhi to go to Vijayawada. It is because I couldn't get a confirmed ticket to Vijayawada, but got a confirmed ticket to Delhi. The ticket price to Delhi is cheaper than the highest ticket price of premium tatkal to Vijayawada. Also, for tatkal tickets, there is a risk of not getting the tickets. So, I booked till Delhi. 

In my compartment, everyone was going to Delhi or Agra, and nobody needed to get up early. Since there was zero disturbance at 4 AM, I couldn't get up eventhough I had 3 alarms setup in the span of half an hour. I got up 15 minutes after the train left Vijayawada. 

Tamil Nadu express is one train which stops at very less number of stops (first four stops are in four different states). I had to get down at Warangal and return. 

It did not happen just like that. It had a reason. 

Review of "India Unmade: How The Modi Government Broke The Economy" by Adithya Sinha and Yashwant Sinha

This book is like, it was written by a village level leader, and not like a former Finance Minister of India. 

When a village level leader writes a book, he/she would take the news items in the popular newspapers and compile them into a book and release it. 

When a reasonably good leader writes a book, he/she would atleast listen to the reasons of others once, before criticizing based on a news article. 

When a serious journalist or a big leader writes a book, he/she would get all the information from all the parties concerned, asks them relevant questions till they don't have any more information to share, and finally writes a book with his/her opinions and the facts told by all the parties. 

Before reading the book written by a former Senior Cabinet Minister, I expected that he would consider all the points of the Government before criticizing them. But, he criticized the Government like a village level leader without even listening to the basic explanation from the Government side on many points.

A small example of his criticism on NPAs.

When this government presented in Parliament the Economic Survey of 2014, it quantified bad loans, or NPAs, at Rs. 2.05 lakh crore. Then, in October 2018, Jaitley shifted the blame to the previous government, saying the NPAs when Modi took office were not Rs.2.05 lakh crore but Rs. 8.5 lakh crore. Did he then lie to Parliament in 2014? If yes, this demands a privilege motion against the finance minister. 

This paragraph is enough to tell that he is blindly accusing Modi either by hiding the actual facts or without understanding the basics. 

Till 2014, the banks were are not recognizing many loans as NPAs eventhough they are NPAs. They were restructuring the loans and making them ever green. Raghuram Rajan stopped that, and in 2015, he had done Asset Quality Review of the loans, and many loans were now recognized as NPAs eventhough it was not marked as NPA initially. This led to an increase in the actual NPAs. 

Arun Jaitley might have mentioned that, after the Asset Quality Review, they might have recognized that the actual NPAs were Rs. 8.5 lakh crore. 

If Yashwant Sinha had done some research on his own and comes up with some number, and say that, the actual NPAs were Rs. 4 lakh crore and not Rs. 8.5 lakh crore as mentioned by Arun Jaitley, it would have been little reasonable, irrespective of whether his claims are correct or not. 

Instead, talking about the privilege motion against the finance minister clearly tells that his only goal was, blaming Modi and his government by relying on out of context data points. 

For many of his criticisms, I heard some reasoning from the government. What I expected from this book is, his counter points on the reasons by the government. But, I did not find any. All his criticisms are very lame.

Sirivennela Seetharama Sastry

When Veturi Sundararama Murthy expired, I had many doubts.

What would happen to Telugu songs?

Who would write Lyrics to tell what they wanted to tell rather than just random words?

Who would give the same importance to the Lyrics irrespective of whether it is a big/small movie/hero/director/producer?

Will I ever see good Lyrics in a low budget and a small hero's movie?

I got the answer when I watched the Padutha Theeyaga episode that was telecasted immediately after his death. S.P.Bala Subrahmanyam talked a lot about the guest of that episode. 

After that, I got the confidence that the guest (Sirivennela Seetharama Sastry) would take care of Telugu songs. 

Now, he is also no more. I have the same doubts again.

Income Tax Notices to a Prominent Actor

The Income Tax Department conducted a search and seizure operation at various premises of a prominent actor.

I don't have any comments on what they found in the search. The actor, his accountants and lawyers would deal with that. But, I have an issue with one point that they said about his Charity Foundation. 

The Charity Foundation incorporated by the actor on 21st July, 2020 has collected donations to the tune of Rs. 18.94 crore from 01.04.2021 till date, out of which it has spent around Rs. 1.9 crore towards various relief work and the balance of Rs. 17 crore has been found lying unutilized in the bank account of the Foundation till date.

I absolutely do not see any issue with the information in the above paragraph. But, the Income Tax Department projected that information to defame him and it was widely published in the media as if he had done a fraud.

The Charity Foundation collected around Rs.18.94 crore in 6 months (From April to September of 2021) and they spent Rs. 1.9 crore. What is the Income Tax Department expecting? Is it expecting to spend everything within a month and not do any more charity work later on? 

If an organization receives more money than they need at that time, they would keep the money and utilize only the interest/income arising from that money. By that, they can do their social work regularly without depending on the donations from others later on. 

If the Income Tax Department has really found some fraud in the Charity Foundation, they should disclose those details, rather than blaming the foundation saying, "found lying unutilized in the bank account of the Foundation till date", as if it has been idle for decades, when it was just 6 months. 

With the present information that they disclosed and the news coverage, I could only say that they are trying to malign his Charity Foundation. 

Crowd at Chennai Local Railway Stations

Yesterday Morning I went to Chromepet station in Chennai at 9 AM. There was a lot of crowd nearby the counter. The crowd is significantly more than the crowd in the local trains. The reason was, the tickets for male passengers would be given only from 9:30 AM and the law-abiding passengers were waiting at the station to get the tickets when they start issuing at 9:30 AM.

If the tickets were given to all of them instead of blocking till 9:30 AM, there would not have been any crowd at a small place and the crowd would have spread in 12 compartments every 5 mins.

Government thinks it does not need to solve the problem. But, it needs to convince the people that it is solving the problem.

Income Tax Saga

I filed Income Tax Returns.

In the last financial year, other than salary income and FD, there were only two things that I did voluntarily from a financial perspective. 

At the end of every month, I used to put the savings in the Liquid Mutual Funds and set up STP to the Equity Mutual Funds. 

Redeemed the Mutual Funds that were not performing well.

Others were kind of forced. 

Still, the process of filing returns was very tedious.

I used to invest in stocks. Whenever Arun Jaitley and Nirmala Seetharaman were changing the policies, I used to change my strategy of investments. Last year, I got fed up with the changes that they were bringing every year, and I stopped investing in the stocks altogether.

But, the investments that I made have an effect on my returns every year. 

Tax on Dividends:

Previously, dividends were tax free in the hands of the investor. The company used to pay Dividend Distribution Tax (DDT) and give dividends. Now, the company does not pay DDT, but the investor has to pay the tax on the dividend at the applicable rate based on his/her tax bracket.

Now, I have to declare all the dividends that I have received in the last financial year and pay the tax. 

I cannot just ignore the dividend and submit returns, because many companies that pay the dividend submit all the details to the Income Tax Department.

If the dividend that I declare is less than the amount they expected, then the return would be rejected. 

In my case, there were multiple companies which submitted my details to the Income Tax Department with the amount of the dividend they paid, even when the dividend is less than Rs.10 for the entire financial year. 

Sold Stocks to Escape Tax on Dividend

I stopped buying and selling stocks, but I had to act in two cases.

I had shares of Majesco and it announced a dividend of Rs.974/share. Since the dividends are taxable in the hands of the investor, and if I receive the dividend, I would be bound to pay tax of around Rs.292/share. 

If I sell the shares, then I will have to pay tax on long term capital gains (since, I bought those more than 1 year before the sale date), if the capital gain is more than Rs.1 Lakh. My total capital gain was less than Rs.1 Lakh and no tax on that sale.

I chose the best option. I sold all the shares of Majesco at around Rs.980.

If any stock or mutual fund is bought on before Jan 31st 2018, then that needs to be reported separately with all the details. 

[On Feb 1st 2018, Arun Jaitley introduced taxes on Long Term Capital Gains in Equity. To save the people who already invested in Stocks and Mutual Funds, he exempted the profits upto Jan 31st, 2018.]

I got shares of Majesco when it went public and after that every year, I was getting a couple of shares.

For all the Shares/Mutual Fund Units that were bought after Jan 31st 2018, one has to report the cost of acquisition (of all the Stocks/Mutual Fund Units), Expenditure in Transfer (Like Brokerage etc), Sold Amount. 

But for all the shares that were bought on or before Jan 31st 2018, one has to report the following details for each share/Mutual Fund separately.

ISIN Code of the Stock/Mutual Fund

Name of the Share/Mutual Fund

No. of Shares/Units

Sale Price/Unit

Total Cost of acquisition

Fair Market Value/Unit on Jan 31st 2018

Expenditure for the transfer of the Share/Mutual Fund (Like Brokerage)

Since I bought a few shares of Majesco before Jan 31st 2018 and a few shares after Jan 31st 2018, I had to split them into two, get all the details separately and fill them.

Selling Stocks in Buy Back

I sold shares of TCS as well, because they offered buy back. Typically, when buy back is offered and if the price of the buy back is more than the market price, one would be at advantage by offering in the buy back. Of course, this is not always the case. TCS was one example, where those who did not offer in a buy back were better off. 

For TCS, I bought shares over the last couple of years, but all are after Jan 31st, 2018.  

If the shares are sold within one year after buying, then one has to pay Short Term Capital Gains (15%). If they are sold after one year, then one has to pay Long Term Capital Gains (10% above Rs.1 Lakh). 

I had bought a few shares of TCS within one year. 

To file the returns, I had to split into two parts, one set with shares that were bought more than a year back, and one set that were bought within that year. 

For both the sets, I had to calculate the following.

Total Cost of Acquisition 

Sold Amount.

Expenditure in Transfer [I just put 0 for this in all the sections, as it was a small amount]

Rights Issue

Whenever a company gives rights issue, we can either exercise the issue or sell it to someone else. The exercise or sale has to happen within a limited time after receiving the issue (around 2 weeks). If we don't exercise/sell within that time frame, it would lapse. So, those who are not interested in exercising the issue, can sell it for the market price. 

When you sell that issue, the money that you get is going to be Short Term Capital Gain. And, you have to pay tax on that. 

I got a few rights issues worth less than Rs.400 (in the entire Financial Year). Since I sold them, it was a Short Term Capital Gain and I had to report and pay tax. 

Mutual Fund Units that I sold 

Few Mutual Funds were not performing that good and I sold units in those. I sold a few others of Dividend type. Since, Dividend option is prone to more tax, I redeemed as soon as they were unlocked (Tax Saving Mutual Funds are locked for three years). 

All of them were bought through SIP and spanned before and after Jan 31st 2018. Just like stocks, for Mutual Funds also, for any Mutual Fund that was bought before Jan 31st 2018, needs to be reported separately with all the details. For the units that were bought after Jan 31st 2018, we can combine with all other mutual funds/stocks and report as a single number. 

Even if we are going to report it as a single number for the stocks/mutual funds, to get the final number, we have to calculate at each stock/mutual fund and then sum up to get the final number.

Profit in Liquid Mutual Funds 

Some time back, I switched investing from SIP to STP. 

In SIP, on the specified day, money is deducted from your bank account and invested in the Mutual Fund you choose. 

In STP, on the specified day, a few units would be redeemed from the Mutual Fund you choose, and invested in another Mutual Fund.

When I was investing through SIP, I was unable to manage my bank account, as I was not sure how much money I had to keep in the bank account for all my SIPs and how much money I can use for my expenses. 

Now, I put all the surplus money in Liquid Mutual Fund (Which is a safer form of Mutual Fund and gives returns little better than the Bank account). For example, if I put Rs.12,000 in a Liquid Fund, then I can put an STP of Rs.1000/month over 12 months to another Equity Mutual Fund.

In this process, the Liquid Mutual Fund generates some profit, and I have to pay tax on that. 

Short Term Profits in Liquid Mutual Funds are taxed at the highest tax bracket, unlike Equity Mutual Funds/Stocks which are taxed at 15%.

For Liquid Mutual Funds also, I had to calculate the total cost of acquisition, sale price.

Profit at different intervals

Calculating the total profit for each of the types of investments is not enough. One has to calculate the profit that they got in different periods.

All the profits need to be split into these periods. 

April 1st to June 15th

June 16th to Sep 15th,

Sep 16th to Dec 15th,

Dec 16th to Mar 15th,

Mar 16th to Mar 31st.

Any profit or dividend that you get needs to be separated in the above five periods and needs to be reported separately.

Dividend amount that you got in each of the above periods

Long Term Capital Gains in each of the above periods

Short Term Capital Gains in Equity

Short Term Capital Gains in Non-Equity

Long Term Capital Gains is going to be a little tricky, if we have Stocks/Mutual Fund units that were bought before Jan 31st 2018. We need to calculate taxable profit and split that taxable profit in those five periods. [Calculation of taxable profit of the Stocks/MF that were bought on or before Jan 31st 2018 is different from the Stocks/MF that were bought after Jan 31st 2018.]

Need Simplification of the returns

At the end of the day, after doing all those things, neither me nor the Income Tax Department is going to achieve anything significant. 

For Fixed Deposits, one can download their Interest Certificate from their bank, take that number and directly put it in the appropriate section in returns and they are done with it. 

Unfortunately for Stocks and Mutual Funds, the Income Tax Department is not accepting that. Most of the Mutual Fund AMCs offer capital gain statements, where they give the total profit in each of the funds they invested. But, that is not enough. They need the total amount invested, Sold Amount, and the profit they got in each of the five periods. For Stocks/Mutual Funds that were bought before Jan 31st 2018, it was even more work. 

If I can put four numbers in the four columns (Dividend, Long Term Capital Gains, Short Term Capital Gains in Equity and Short Term Capital Gains in Non Equity) and pay appropriate tax, then the process would be lot simpler. Government is not going to lose anything. If they want, they can directly ask the Stock Broker, Mutual Fund AMC and get the full statements and do whatever analysis they want. 

Few people may say, I am crazy. But, I like Chidambaram far better than many other Finance Ministers that we had (Except Manmohan Singh). 

Filed Income Tax Returns

I have filed Income Tax Returns. 

I was unable to start the process of Income Tax Returns because of one issue. I raised a complaint with the Income Tax site and they did not reply even after 3 weeks.

It turned out to be a Usability issue. 

Till last year, whenever you were going to file returns, you would select Financial Year and then ITR type like ITR-1 or 2 etc. In the new website, after selecting the Financial Year, the dropdown for ITR type is disabled. I raised the complaint and waited for 3 weeks and got no reply from the Income Tax. 

I was told by my colleague, Mohanakrishnan Gopalakrishnan, that we can continue even without selecting the ITR type. The ITR type is asked in the next screen. I could continue and filed returns.

Male Passengers are not allowed in Chennai Local Trains during peak time

 

Men spread Corona.

Women do not spread Corona.

That's why Southern Railways banned male passengers during peak hours in Local Trains in Chennai.

Cannot the government find some sensible rule rather than coming up with sexist/stupid policies?

If they think that there is too much crowd, they can restrict the no.of tickets sold. If they put some limit on the no.of tickets per train, after selling that many tickets, they can stop selling more tickets till a train departs.

Even with this rule, I can see many men during peak time in local trains. Of course, the Government may say, they all have permission letters to travel during peak time. But, it is possible that some of them would have found some woman to take the ticket for them. There is even more chance that many men might be travelling without a ticket, as there are no TTEs.

Before introducing this rule, I don't know whether the authorities saw the crowd in fast local trains or not. The fast local trains are fully crowded and closely resemble pre-covid days.

Khaidi No. 150 - Who are Corporate People?

Who are corporate people?

The people who take our wealth for little money and sell it back to us in dollars. Once, it was Britishers and now these corporate people.

This is told by Chiranjeevi in the movie Khaidi No.150.

I never expected such a stupid definition by Chiranjeevi. If he is expecting some Corporate Responsibility, he should have some Social Responsibility to not mislead people. 

Politics and War are more important than Science, History and many other fields

I must study politics and war, that our sons may have liberty to study mathematics and philosophy. Our sons ought to study mathematics and philosophy, geography, natural history and naval architecture, navigation, commerce and agriculture in order to give their children a right to study painting, poetry, music, architecture, statuary, tapestry and porcelain.

-- John Adams (Second American President)

Stack Ranking - The Only Word That I Don't Like in English

Many companies which have stack ranking follow something similar.

Every year, they identify top 20%, middle 70% and bottom 10%. Those whoever are in top 20% would be given incentives, raises and promotions. Those whoever in bottom 10% either let go or they would be treated in such a way that, they themselves would leave.

Let's suppose, if you hire the 10 most brilliant people in the world, still, there would be one person in the bottom 10%, and that person would be asked to leave, eventhough, they cannot replace that person with anybody else in the world.

One should check, whether their employee is performing better than their expectations based on the position and pay etc. But, not, relative to others. If the company has the most dumb 10 people of the world, and still, if they give promotions to the top 20%, then it cannot survive in long run.

This policy would work only, if the company hires 10% of dumb people every year, so that, their main talent will never be in bottom 10%. But, if they hire equally talented people, then their main talent may leave.

In most of the companies, if the employee is on bench or in insignificant project, then most of the time, they would be in bottom 10%, unless, he/she has very good manager. Because, there won't be anything for them to show in the performance review.

In case of relative ranking, the employee has to prove that, he/she is better than his/her colleague. Many times, it would lead to unfriendly environment. It is not easy to see that, but, the project would be effected severely by that. For example, two employees are seriously discussing on the approach to follow, and both are giving pros of their approach and cons of the other person's approach. This looks like a healthy discussion for many managers. But, if one checks little deep, probably, that discussion itself may be useless. Both might be trying to prove that, they have better design than the other. Probably, if there had been no need to prove anything, then that discussion itself may not take place.

The companies that are too big with lot of cash thinks that, this process is working very well for a long time. For big companies which have lot of cash, even if they do 100 mistakes, but, if they do one thing correctly, it can survive without any issues. If the same thing is done by a startup, it would die immediately.

If your organization has stack ranking, don't expect any employee who does not care about recognition, to work with you for a long time.