You need diversity in background and experience so that peer reviews have meaning. About ten years ago a number of people were made redundant - none had ever met before and worked well together. Subsequently development/support was expanded back to its original staffing levels. However, those employed had all been at school together. It was a difficult era with poor database design and input utilities that did next to no validation. There was endless fire fighting. A change in MD resulted in a cultural change and all of them left of their own violation. However, the damage to cash flow had been done and the company went under.

In a previous company I had seen a similar thing when promotion became a "family and friends" scheme and people were promoted beyond their own ability! The company survives to this day much reduced in size. In the process only one of the clique was not axed!