[mrbgty]

Sounds to me like no matter what system is used, the problem is that there's a limited number of promotions/raises to give out.

If your employees really are adding value to the company, then why should the promotions/raises be limited?

[sokoloff]

Because promotions are generally to a new role, and have been perverted at some places to simply be a new title. Want to get promoted from a Developer to a Developer-2? Those are unlimited.

Want to get promoted from a developer-15 to Amazon's CTO? Those are limited.

[icodestuff]

The Developer to Developer-2 (in Amazon parlance, SDE-I to SDE-II) is VERY limited at Amazon as well. OLR doesn't just hold back managers, it holds back everyone, and it badly hurts their competitiveness in the labor market. After 18 months as an SDE-I there, I received a 4% raise, which was huge, for Amazon (though cost of living in my area went up substantially more during that time). But there was never a chance I was going to be promoted at that time, even though I had been very close to being hired as a II, and if I'd been interviewing then instead of being reviewed, I would have had the II title and compensation. So I left a couple months later (mostly for other reasons, but I won't pretend this wasn't a factor), and got that at my new job. Their loss.

[ffrryuu]

Hence Finance companies call everyone Vice President, because they know their only asset are people.