The company is having an identity crisis. Can't figure out who it wants to be. Can't change fast enough to compete. Some departments undergo frequent reorganizations, leading to some layoffs, shuffling, bitterness. Managers are protected by each other and HR. HR forces managers to hire people who are not experienced in order to keep salaries down. Employees are left to fend for themselves. Raises and promotions are based on how nice you are to your manager. Ratings are kept low to "give people something to strive for." Annual raises are in the 2% range.