Perspectives on MEI vs DEI
A shift in thinking about hiring practices in the tech industry is underway. MEI (Merit, Excellence, and Intelligence) is a new ‘recruiting’ trend focusedon selecting candidates based on their individual merits, skills, and abilities rather than demographic characteristics. MEI emphasizes hiring the best person for the job and values ability and intelligence. It arose pretty much as a backlash to DEI that’s begun to stifle and create workplace conflict in many companies. Because MEI isn’t really anything new at the core of recruiting or i/o psychology / occupational psychology – selecting for cognitive ability, conscientiousness and other desirable traits is the most obvious and desirable recruitment path. MEI is going to popularize it and polarize discourse, but this discussion is very much needed.
MEI Through the Lens of Scale AI’s Founder
MEI is a term coined by Scale.ai’s founder Alex Wang, who has formalized MEI as a hiring policy at his company stating that Scale AI’s success stems from hiring based on merit. He argues that this approach ensures that the company attracts and retains top talent and creates a culture of excellence, as MEI allows for objective hiring practices, free from the biases and constraints of demographic considerations. Wang emphasizes treating everyone as an individual and judging people by their character, talent, skills, and work ethic. This is great – a merit-based hiring process naturally yields diversity without compromising performance.
DEI
DEI (Diversity, Equity, and Inclusion) is an organizational approach to hiring and workplace norms, that aims to increase representation of historically underrepresented groups and to create a more “inclusive” environment. DEI emphasizes the importance of a diverse workforce, equitable treatment, and inclusive practices that ensure all employees feel valued and supported, regardless of their background. Unfortunately, it’s been hijacked by ideologues and activists, which is the key reason IMHO why it’s failing.
“Diversity is a competitive advantage, but it’s not a strategy. It’s a tactic that needs to be part of a broader approach to talent acquisition and development.” – prof. Scott Galloway, marketer, entrepreneur and lecturer at NYU Stern
MEI is gaining ‘traction’ in Silicon Valley
MEI is gaining traction because it promises a straightforward and ostensibly fair approach to hiring. Supporters claim it prioritizes the best candidates based on objective criteria, thereby driving company success and innovation. Several prominent Silicon Valley leaders have expressed support for Wang’s approach.
MEI is primarily performance-driven and focused on hiring the best talent, regardless of background, which is obviously an easier task and goal as it is just one goal, as opposed to conformist decision-making in hiring around multiple objectives that are hard to achieve all at once. In this way ‘MEI’ treats all candidates equally and creates an aura of fairness in this regard. An interesting point being made is that MEI can help avoid potential discrimination lawsuits. However, above all, I feel that MEI is the result of the pendulum swinging in the opposite direction after the DEI excesses post-2020. MEI in this regard is simply a backlash against perceived reverse discrimination and the negative consequences on company culture, performance, and fairness resulting from DEI initiatives being established by universities and corporations, above all, for virtue signaling reasons.
“Hire for intelligence, energy, and integrity. You can’t really train those, but you can train almost everything else.” – Naval Ravikant, entrepreneur and investor
Critique of DEI
Despite the great intentions, DEI initiatives have above all focused on fostering workplaces and campus environments where individuals from various gender and minority identities are strongly represented. DEI is among the policies that inadvertently stifle diverse perspectives and productivity in the pursuit of equal outcomes. DEI, by being too politicized and ideological, has only hurt itself. Instead of focusing on skin color it should focus on leveraging diverse perspectives to help foster innovation. DEI initiatives must be balanced with meritocracy to ensure that individual competence and performance are key, and not secondary or tertiary in hiring and employee evaluation. If this was honored, DEI would create opportunities and reduce systemic barriers for underrepresented groups.
“The proper way to solve the problem of diversity is to choose people on the basis of their competence, and not to eliminate competence as a criterion.” – prof. Jordan Peterson, clinical psychologist and University of Toronto professor
DEI faces criticism for sometimes leading to tokenism and for implementing quotas that may not always align with meritocratic values. Critics argue that DEI initiatives can create divisions and resentment if not handled carefully. There is also concern that DEI can become a checkbox exercise rather than a genuine effort to foster inclusivity and equity. DEI programs unfortunately do often conflict with meritocratic principles, and face several criticisms:
- Reverse discrimination concerns around race-based quotas or targets/treatment based on demographic factors rather than actual competencies, skills or performance
- Tokenism and hiring for appearances through preferential treatment in hiring and promotion decisions
- Declining popularity, with DEI-related job postings decreasing.
- Negative impact on performance.
I won’t write about this further, as we already have here in our “Culture eats DEI for breakfast” article.
Critique of MEI
Critics of MEI raise three legit concerns. First, the potential for unconscious bias in hiring for “merit.” Because MEI can lead to homogeneity in the workplace, as people tend to hire those similar to themselves. Also, the onus on defining merit is on the founders, execs, CHROs and People leaders. But it is often hard and nuanced to define merit in dynamic, changing company and organizational settings. For instance, ‘merit’ requires different attitudes and soft competencies if someone is placed in a startup or in a corporation – due to the nature of needed performance and the nature challenges in each organization type.
Second, ignoring systemic barriers (above all factors outside the company’s control) that affect access to opportunity, especially where this affects opportunities for people from poor socio-economic backgrounds eg. low income, weak schools. This is outside any company’s control, eg. the impact of school districting on education disparities between high income and lower income families. Where high inequality exists, and is connected to racial disparities (South Africa is probably the best example of this), companies should not ignore such systemic barriers to opportunity, and should be careful about unconscious biases creeping in, because they could miss on discovering excellent hidden talent, and inadvertently contributing to these disparities.
Third, an oversimplified, narrow definition of ‘excellence’ might overlook diversity brought in with different perspectives. This doesn’t require explaining – diversity of perspectives and backgrounds should be sought-after.
Entrepreneur Naval Ravikant offers perhaps the most balanced perspective on this topic: “Diversity of thought is critical. But it comes from diversity of experience, not diversity of skin color.”
Perspectives on MEI vs DEI
Many argue that MEI is a necessary correction to the excesses of DEI, ensuring fairness and meritocracy. Others believe that without DEI, systemic biases will continue to exclude talented individuals from underrepresented backgrounds. There’s a growing movement away from DEI in the tech industry, with many founders believing MEI to be a fairer and more effective approach. Several prominent entrepreneurs and tech leaders have expressed their opinions on DEI and MEI recently:
- Lulu Cheng Meservey: “The implication that women or minorities need anything other than an even playing field to compete and win on merit has always been insulting.”
- Brian Armstrong: “Looking back, implementing a mission-focused approach was one of the most positive changes at Coinbase.”
- Elon Musk: “Merit should be the only reason for hiring, especially for jobs where your family’s lives are at stake.”
- Joe Lonsdale: “Merit and competence solve a large percentage of the problems facing our civilization.”
- Paul Graham: “Bold leadership from Alexandr Wang. ‘Hiring on merit will be a permanent policy at Scale.'”
- Bill Ackman: “Martin Luther King’s dream was to be judged by character, not skin color.”
- Ali Partovi: “A true meritocracy is attractive to anyone underrepresented.”
- Garry Tan: “Merit, excellence, and intelligence is the path forward.”
- Jason Calacanis: “Startups don’t have the time or resources to spend on DEI efforts.”
- Alexander Leishman: “We hire purely for intelligence/skill and culture fit.”
- Shaun Maguire: “It requires bravery to say your hiring principles are based on MEI.”
- Palmer Luckey: “Powerful and persuasive, bravo.” [on Alexander Wang’s MEI approach].
- Ryan Petersen: “Flexport hires and promotes based on people’s ability to contribute to our mission.”
- Suhail Doshi: “Obsessing over anything besides merit will prove to be unwise.”
- Chrisman Frank: “DEI is over. Time to return to meritocracy in both education and hiring.”
- Harj Taggar: “Scale is the fastest growing startup in the world right now.”
- Madhulika Mukherjee: “Delightree has, and will always be, a place where merit is rewarded above everything else.”
I thought it’d be worth highlighting the perspectives of four respected figures on this topic.
Scott Galloway
Galloway critically views the effectiveness of corporate DEI programs, questioning their impact and efficiency. He suggests that a focus on merit and excellence should not conflict with diversity efforts but instead should enhance them by ensuring that the best candidates are chosen without bias. He’s also emphasized the importance of boards that reflect the diversity of their customer base and/or workforce.
“The most successful companies are those that can attract and retain the best talent. Period.” – Scott Galloway, NYU Stern professor, entrepreneur & marketer
Earl “Butch” Graves Jr
Earl “Butch” Graves Jr., CEO of Black Enterprise, has pointed out that many corporates made big promises about DEI in 2020-2021, but barely any actually followed through with real action. Out of the $50 billion pledged, only $250 million was actually spent… because DEI is treated as a box to check off to pander to stakeholders and consumers.
The only way for DEI to work according to Graves Jr is to make it a core part of how a company operates – by embedding DEI into the company’s strategy. Graves believes that especially Black executives have to step up and put their perspectives on this in the conversation, in order to drive economic empowerment. First, because when companies have truly diverse teams, performance improves. Second, corporations could subsequently create more opportunity for underrepresented groups by hiring, training and enabling diverse talent.
Thomas Sowell
Thomas Sowell has frequently criticized “woke” ideologies, arguing that they undermine educational standards and intellectual freedom, and that merit-based systems are essential for maintaining high educational standards and fostering true academic excellence.
Jordan Peterson
Jordan Peterson has been a very vocal critic of DEI bureaucracies, because they often impose ideological conformity and suppress free speech. He believes that hiring and admissions should be based on merit, not demographic characteristics, and has spoken about merit-based systems in his lectures and interviews, stressing the importance of competence in hiring and educational practices.
Peterson talks a lot about being self-aware about one’s preference and personality, by asking people for feedback and being introspective, or by using Jordan Peterson’s personality test. He argues for a hierarchy of meritocracy based on several key points that emphasize competence, responsibility, and the benefits of structured hierarchies in society:
- Competence-Based Selection: hierarchies are essential for organizing society effectively, as they allow the most competent individuals to rise to positions of influence and responsibility based competence and skill.
- Natural and Necessary Hierarchies: hierarchies are a natural and necessary aspect of human societies that emerge naturally in various domains, including biology and social structures, because they are effective mechanisms for organizing groups and achieving complex goals.
- Encouragement of Excellence, Productivity and Innovation: a meritocratic hierarchy encourages individuals to strive for excellence and foster productivity and innovation. This provides people with motivation and purpose. And when the most capable individuals are placed in positions that fit their abilities and knowledge, organizations and societies are more likely to thrive and adapt.
- Reduction of Resentment: by promoting individuals based on merit rather than arbitrary characteristics such as race or gender, meritocratic hierarchies can reduce resentment and division within organizations.
- Equality of Outcome is Evil: the idea of equality of outcome is inherently unfair and counterproductive. Attempts to enforce equal outcomes – such as DEI – often lead to mediocrity and the suppression of individual potential. That is why he strongly advocates for equality of opportunity, where individuals have the chance to succeed based on their abilities and efforts.
Mission-focus aligns well with meritocracy
A mission-focused approach aims to create a more unified and productive work environment by avoiding potential distractions and divisions that can arise from engaging in divisive socio-political discourse. Many tech companies adopt a mission-focused approach to their operations and culture. Coinbase and Scale AI have publicly declared their commitment to focusing solely on their business objectives. Brian Armstrong from Coinbase articulated this philosophy in a blog post, stating that the company would concentrate on its mission to create an open financial system for the world. Similarly, Alexander Wang of Scale AI introduced the concept of MEI as the guiding principle for hiring and the workplace.
The Mission Protocol advocates for focusing on a company’s mission without getting sidetracked by political issues. Many founders argue that this approach ensures clarity and effectiveness in achieving company goals. It is probably one of the most culture-aligned approaches to hiring and managing a company, as long as the values inside the company and mission are aligned and – this is crucial – are not declarative, but are actually put into realization.
Culture-first goes hand-in-hand with merit
Culture plays a significant role in attracting and retaining talent, fostering innovation, and driving overall company performance. When combined with a meritocratic approach, it can create an environment where employees feel valued for their contributions and are motivated to excel. A strong company culture is increasingly recognized as crucial for success, particularly when aligned with principles. Companies like Coinbase have emphasized the importance of creating a culture that supports their mission and values.
When employees feel that their contributions are valued and that they have equal opportunities for growth and advancement, they are more likely to be motivated and committed to the company’s success. Key aspects of cultures that supports meritocracy include:
- Clear evaluation criteria for advancement based on merit
- Encouragement of diverse perspectives and ideas
- A focus on results and rules that eliminate office politics and the corporate mindset
- Transparency in decision-making processes
Meritocracy does not exclude Diversity
Meritocracy actually must enable diversity, otherwise it isn’t based on merit. By focusing on ability and performance companies can attract and retain a diverse workforce in a natural means without resorting to quotas or preferential treatment based on demographic factors. True meritocracy can lead to diversity as a natural outcome of seeking the best talent from all available sources. However, to achieve this, companies need to:
- Cast a wide net when recruiting.
- Use objective criteria for evaluating applicants.
- Mitigate unconscious biases in hiring and promotion – this is hard, but truly essential.
- Create an environment that values diverse perspectives and freedom of speech.
If the above are up your alley, you certainly should consider using behavioral, personality and cognitive talent assessments in your recruitment process.
Meritocracy, Culture and Mission alignment
When meritocracy, culture, and mission are well-aligned, this creates a powerful framework for company success. This alignment can lead to increased employee engagement and productivity, attracting and retaining top talent, and a more innovative and adaptable organization. Companies like AirBnB and Coinbase are examples of organizations striving to align these elements. By focusing on their core mission, fostering a culture of excellence, and implementing meritocratic practices, they aim to create an environment where top talent and diverse talent can thrive.
To make this a reality, these companies have actively worked to eliminate biases in their hiring and promotion processes. This can include strategies such as blind resume reviews, structured interviews, and diverse hiring panels. Implementing this alignment requires consistent effort and clear communication from leadership. Companies need to regularly reinforce their mission, demonstrate their commitment to meritocratic principles through their actions, and actively shape their culture to support these goals. This might involve regular town halls, transparent decision-making processes, and opportunities for employees to provide feedback and shape the company’s direction. Furthermore, these companies recognize that true diversity itself contributes to merit and performance.
Per usual, maintaining this alignment can be challenging, especially as companies grow and face new pressures. External factors, such as changing market conditions or social expectations, can put pressure on companies to shift their focus or alter their practices. The key is to remain flexible and adaptable while staying true to core principles. AirBnB did this during COVID (they almost collapsed) and Coinbase during the crazy sinusoidal bubbles and busts of the cryptocurrency trading industry that they serve.
Side note: will MEI make it to US academia?
The current climate in many US universities has been marked by woke ideology, which has led to concerning incidents of censorship and hostility, particularly towards Jewish students, faculty members, and guest speakers who express views that contradict prevailing progressive narratives. These actions really stifle diverse viewpoints and intellectual debate, creating an environment of fear and conformity. This is like a spear into the heart of academia, which can only flourish under individual freedom conditions. As prof. Scott Galloway has pointed out, there’s a growing intolerance for diverse viewpoints, especially those that challenge the orthodoxy of social justice ideologies. Prof. Jordan Peterson has been a vocal critic of the impact of “woke” culture on academic freedom, arguing that it suppresses dissenting opinions and intellectual diversity. Implementing truly MEI-based admissions would address these issues by prioritizing merit, excellence, and intelligence over ideological conformity. By focusing on objective criteria, such as standardized test scores, we ensure that the most capable and talented individuals are admitted. Universities have begun reinstating SATs (although it beats me how the hell they made SATs optional…).
Hope this is helpful in informing you the various recruitment and workplace development perspectives around MEI and DEI.
Extra resources / links:
https://x.com/alexandr_wang/status/1801331034916851995
https://news.ycombinator.com/item?id=24832404
https://www.missionprotocol.org
https://www.coinbase.com/blog/coinbase-is-a-mission-focused-company
https://barmstrong.medium.com/35-ways-coinbase-hires-develops-and-retains-great-people-cbfdf93b1c5c https://www.meritocracy.com/
https://www.joannejacobs.com/post/the-rise-of-mei-merit-excellence-and-intelligence
https://scale.com/blog/meritocracy-at-scale