up or out

"Up or out" is practiced throughout the accounting industry in North America,{{cite book|title=The Cultural Shaping of Accounting|url=https://books.google.com/books?id=1QTuY9Lgu9gC&pg=PA76|year=1995|publisher=Greenwood Publishing Group|isbn=978-0-89930-953-8|page=76}} most notably at the Big Four accounting firms,{{cite news|title=Talent management: Accounting for good people|url=http://www.economist.com/node/9507322|newspaper=The Economist|date=July 19, 2007}}{{cite web |first=Steve |last=Barley |url=http://www.big4.com/deloitte/big-4-culture-the-more-things-change-the-more-they-stay-the-same |title=Big4 Culture: The More Things Change, The More They Stay The Same |website=www.big4.com |access-date=13 January 2022 |archive-url=https://web.archive.org/web/20120409212415/http://www.big4.com/deloitte/big-4-culture-the-more-things-change-the-more-they-stay-the-same |date=April 3, 2012 |archive-date=9 April 2012 |url-status=dead}} which also practice this policy in their branches in other countries.{{cite book|author=Paul Gillis|title=The Big Four and the Development of the Accounting Profession in China|url=https://books.google.com/books?id=wnUGAwAAQBAJ&pg=PA45|year=2014|publisher=Emerald Group Publishing|isbn=978-1-78350-486-2|page=45}}

Up or out is also practiced in the investment banking industry, where third-year analysts and third-year associates who will not be promoted are asked to leave the bank.{{Cn|date=June 2022}}

The management consulting industry also practices up or out, where it is commonly regarded as a sign of the industry's "hard-nosed approach to doing business," with Bain & Co and McKinsey & Company being the two consultancies most closely associated with the approach.{{cite news|author1=Charles Batchelor|title='Up or out' is part of industry culture|url=http://www.ft.com/cms/s/0/d42434b2-6b69-11e0-a53e-00144feab49a.html|work=Financial Times|date=April 20, 2011}}{{cite news|last1=Raghavan|first1=Anita|title=In Scandal's Wake, McKinsey Seeks Culture Shift|url=https://www.nytimes.com/2014/01/12/business/self-help-at-mckinsey.html|work=New York Times|date=January 12, 2014}} According to Leslie Perlow, up or out is also employed at Boston Consulting Group.{{cite book | author = Leslie Perlow | title = Sleeping with Your Smartphone | year = 2012 | publisher = Harvard Business Press | type = Hardcover | isbn = 978-1-4221-4404-6 }}

Among many other law firms, Cravath, Swaine & Moore's so-called "Cravath System" historically expected associate lawyers to achieve partner status within ten years of being hired or to leave the firm.{{Cite web|url=https://apps.americanbar.org/litigation/committees/youngadvocate/email/spring2012/spring2012-0612-how-become-law-firm-partner.html|title=How to Become a Law Firm Partner |publisher=American Bar Association|access-date=2024-12-15|first=Matt|last=Shinners|date=June 7, 2012|archive-url=https://web.archive.org/web/20140822183421/https://apps.americanbar.org/litigation/committees/youngadvocate/email/spring2012/spring2012-0612-how-become-law-firm-partner.html|archive-date=2014-08-22}}

U.S. entrepreneur Vivek Wadhwa has argued that engineering in Silicon Valley is also "an 'up or out' profession: you either move up the ladder or face unemployment".{{cite news|author1=Vivek Wadhwa|authorlink1=Vivek Wadhwa|title=Silicon Valley's Dark Secret: It's All About Age|url=https://techcrunch.com/2010/08/28/silicon-valley%E2%80%99s-dark-secret-it%E2%80%99s-all-about-age/|work=TechCrunch|date=August 28, 2010}}

In the U.S. military, the 1980 Defense Officer Personnel Management Act (DOPMA) mandates that officers passed over twice for promotion are required to be discharged or, if eligible, retired from the military. Officers in the former category, normally pay grade O-3 and below, are typically removed from active duty service at the end of the calendar year following their second non-selection for promotion. However, they may be granted a transfer to the Reserve Component at their current rank and remain eligible for promotion in the Reserve Component. Retirement eligible officers in the latter category will typically serve up to a maximum years of commissioned service point based on their final rank, such as 20 years for O-4, 28 years for O-5 and 30 years for O-6. These mandatory retirement dates may be periodically adjusted lower via Selective Early Retirement Boards (SERB) and Temporary Early Retirement Authority (TERA).{{cite book | author = Bernard Rostker | author-link = Bernard Rostker | title = The Defense Officer Personnel Management Act of 1980 - A Retrospective Assessment | year = 1992 | url = http://www.rand.org/pubs/reports/R4246.html | isbn = 0-8330-1287-8 |display-authors=etal}}{{cite news|author1=John T. Reed |title=The 'U.S. military's marathon, 30-year, single-elimination, suck-up tournament' OR 'How America selects its generals' |url=http://www.johntreed.com/tournament.html |archive-url=https://web.archive.org/web/20071219093746/http://www.johntreed.com/tournament.html |archive-date=December 19, 2007 }}

DOPMA has been frequently criticized as "arbitrary and bad management" that forces out "many fit, experienced officers... because there were only so many slots into which they could be promoted." Paul V. Kane, a Marine veteran of the Iraq War and a former fellow at Harvard Kennedy School, argued in 2009 that the "archaic 'up or out' military promotion system should be scrapped."{{cite news|last1=Kane|first1=Paul|title=Up, Up and Out|url=https://www.nytimes.com/2009/04/21/opinion/21kane.html|work=New York Times|date=April 20, 2009}} High Year of Tenure is a similar system applied to enlisted ranks.

Manning control within the British Army plays a similar role.

The United States Foreign Service has used an up-or-out system since 1980. The American Foreign Service Association, the professional organization for foreign service officers, has criticized the system on the grounds that it penalizes otherwise-dedicated officers who do not wish to enter Senior Foreign Service.

{{See also|Publish or perish}}

Tenure-track professors in the United States are usually subject to an up-or-out system. Newly hired professors, most often with the rank of assistant professor, must impress their department with their accomplishments to be awarded tenure, usually but not always combined with promotion to associate professor. Those not awarded tenure within a fixed time may be terminated. This first promotion may be required for tenure and further promotions are neither guaranteed nor necessary.

Despite widespread use in certain industries, a 1988 textbook by Michael Jensen noted that the system's effects on productivity have not been studied in depth.{{cite book|author=Michael C. Jensen|title=Foundations of Organizational Strategy|url=https://books.google.com/books?id=B-TP-fxGJDQC&pg=PA215|year=1998|publisher=Harvard University Press|isbn=978-0-674-64342-0|page=215}}

• Forced ranking
• Lifetime employment
• Mandatory retirement
• Peter principle
• Vitality curve

{{Reflist}}

Category:Human resource management