I think there are four major points in this issue:

1) Bodies (or as we used to call them "cheeks in seats")

2) Qualifications

3) Quality

4) Non-linear scaling of work output.

When you deal with very large contracts, like say for the government, the customer is interested in two things: #1 and #2. #2 is viewed as a proxy, or a logical result for #3. And #4 is not well understood inside of most large organizations to this day as people are considered the same as equipment.

Six Sigma (6S) (http://en.wikipedia.org/wiki/Six_sigma) is more often than not the strategy used in these kinds of organizations.

To that end, if you consider a beer bottling factory, you can linearly scale the operation if you simply add more lines to the process. Substitute "equipment" for "bodies" in #1, #2 is the make and model of the equipment and #3 is irrelevant if #2 is correct and #4 is possible under these constraints and according to 6S, if done properly will linearly scale your output at no loss to quality.

What happens is that 6S is then applied to the world of people in big projects because we lack the management tools to measure and monitor large programs and 6S is as close as we get. Most important in this milieu is that what is measured (I'm being a bit reductionist in this statement but meh...) is purely the number of equipment (bodies) by the work output (lines of code/reports/successful missions/etc.) with very little assessment done on quality.

People are hired based almost entirely on resume bullet points. Usually with a cursory phone interview and if you're lucky a face-to-face interview so you can ask them to recite their resume bullet points and make sure they aren't crazy people. There is usually no other test. If you hire a person, so long as they don't violate some workplace rule, they fulfill #2. The only real determinant in who you hire is that the resume fills most of the checkboxes that the client has laid out during the program competition phase a year or more ago. Are they missing some points? There's usually a process where the resume is floated up to the client and they usually just sign some waivers that "yes yes, #1 is more important than #2 and we're willing to accept a minor negative in #3" so that the hiring agent doesn't get in trouble.

When a more senior manager wants to know how shop XYZ is performing with the 150 new people they just added to the contract, the report is invariably full of bar charts and numbers about such things, often with the important figures on different slides and almost no analysis that would demonstrate that the scaling is not working linearly. "We answered k requests for reports" on one slide "we are at 93% of hiring strength" on another and yet on another "we need an increase in budget for labor category q1.3 as we've had 50% turnover in that sort of position" etc. And that's more or less how the weekly or bi-weekly program management review PMR will go.

If all of the boxes are checked, the PMR was successful. If there were unchecked boxes, say "we are at 91% hiring strength instead of the goal of 93%" there will be hell to pay. Even if the 91% is more effective (produces more output) than the desired 93% because the quality is not under consideration because the bodies have met the qualifications for their position.

These are very manufacturing oriented metrics completely without regard to the nature of the work under consideration and they are used almost universally in large organizations when they need to quickly accomplish #1.

Now why does this happen? Why are potentially poor candidates hired? Anybody who's hired enough people knows that #2 is often a falsehood. People will put down any sort of crap on their resume. You have to vet people, often through some kind of testing process to hopefully ensure quality -- even if that doesn't always work, it's something. Some companies use education as a proxy for some of this: as in "you must have graduated from Harvard, Yale, Brown or Stanford for consideration". But the god honest truth is that in most of these organizations, the need to put cheeks in seats outweighs the desire to put quality people in the seats. Why? Subtle quality signals get lost when reported in aggregate to management, and thus management only cares about the kinds of things that aggregate information tells them. Your boss's boss's boss's boss wants 150 people on that contract yesterday so they can start realizing the revenue from the contract. By the time it gets to you, and your success/failure gets back up to him, the only thing that matters is that you push as close to 100% as possible. Not that you just hired a guy who can fit a chess playing algorithm inside of 12k of memory on an Amstrad CPC. Or somebody who speaks 12 languages fluently because the contact only requires that they know 2.

On the other side of the equation, when you win a contract and have to plus up on hiring 1200 people inside of six months, you will accomplish this or you will loose the contract. 1200 people is more important than 1200 fully qualified, high quality people.

And finally #4. As most people know #4 is still not well understood. I mean most people notionally understand that you don't just add twice as many people to a project to finish it twice as fast. But there are subtle unsolved problems with this. For example, can you produce twice as much in the same amount of time with twice as many people? How about, "well how many people do I need to add to double output/halve production time".

If these fundamental questions don't have solid answers, organizations will attempt to solve them by throwing metric tons of money at them because that will give the appearance of solving it. Subtly in the higher ranks of the organization, they will ensure that the information reported to them will ensure that it looks like it solves it.

I'm not saying this is right, but money does in fact solve hiring. From the organization's standpoint they need to triple their output? They hire 3x the number of people. How much does this cost in salary per person? Supply that much money.

Output didn't triple? Add more people!

Done.