Jason, another thought on these lines is that the talented worker will get stronger.  They'll figure out how to be better or go to da different place, especially if they're truly talented.  The lazy worker and the less-than-competent manager and their company institutionalizes this mediocrity.  Everyone who chooses not to be mediocre, leaves.  It really does all start with one manager.

As managers, we have to choose which behaviors we will reward.  We'll get whatever we allow to exist.  Mike...