Managing Your Company To Death 398
puppetman writes "This weeks I, Cringely is a frightening monologue on the plight of over-managed companies: VC's and professional managers who are looking to make a quick buck, even if it consigns the company to the rubbish heap. He praises companies like Oracle and Sun because the founder still runs the company, and is in touch with the core of the buisiness. He also makes an interesting aside about the founders of the Canadian company, Research in Motion (makers of the Blackberry) and their personal contribution of $120 million for research into particle physics, to illustrate what happens when technical expertise and business success can lead to."
Lets not forget (Score:4, Insightful)
Counter point - Balance shortterm/long term! (Score:5, Insightful)
Money is, and always will be a bargaining point. If the benefits are not highllighted properly, research centers are borne to get their funds taken away, or worse, closed down.
Delegating is an artform. (Score:4, Insightful)
What a big company needs is a clear direction and not what_pen_to_buy decicions.
Re:good point (Score:5, Insightful)
Who is going to do that? The companies? Or perhaps, the goverment will enforce the use of such contracts? Keep in mind that during the months before the telecoms crash, most goverments in Europe actively encouraged common people to go out and buy stock and they used the short-term, noisy, biased indicator that the stock-market is as proof that the country economy was stable, improving, etc.
The truth is, stockmarkets don't work - not in the way I'd like them to anyway - they're just a big bazaar, where wize-guys can go and con other people of their money. So, if a company decides to go for an initial public offering - and thus enter the pit - they'll be getting what they deserve.
Blame the stock market? (Score:3, Insightful)
When more money is needed, the stock market is used to to so, but as a result other people own the shares of the company and expect too much from it: they think that the company can still grow as much as it did during itsstartup. When it fails to do so, they blame the management (of course) and replace it in order to make as much profit as possible and in a short time frame.
The New Feudalism (Score:5, Insightful)
And just like back in the day during feuds and other conflicts nobles who lost were almost always treated well by the victors and often were offered chances to switch allegience, today you can easily climb into a good job even if your company tanks (lacking a distinct skill set, managers are fungible; just look at the utterly disparate types of businesses that many CEOs have managed in their careers) and if that fails, there's always the golden parachute.
Back in the day, there were rarely serious consequences to the behavior of nobility as long as it didn't involve treachery towards those above you, and today this seems to be so with our manager class, at least as far as business decisions go. Being noble was enough.
Re: Businessoriented employes(was:Lets not forget) (Score:5, Insightful)
Take a look at the last couple of years pathetic business-models and how many technology companies have been run and have tried to sell stuff.
A couple of examples:
* We are going to expand. No matter if we have customers or not, we are going to expand. DON'T EXPAND JUST BECAUSE ITS FUN! Expandations should in most cases be organic, in small companies it should more or less ALWAYS be organic.
* We are going to spend thousands of man hours (=gigantic cost) and then give our products away for free. Dot-coms and open source development companies are examples of this. FREE DO NOT PAY THE BILLS! Nothing will ever change this fact. And just forget about charging in a later stage. Have you got customers used to the idea of not paying it's extremely hard to change that later.
* We are going to give away this huge product and
sell this tiny thing thats optional. If you do this you have just teached your customers that a huge product doesn't cost anything, and then it doesn't make any sense to pay for a tiny part. This is how peoples minds work. Any business-oriented person knows this but tech-people apperently does not.
* We are going to sell product X or service Y for this cheap stuff. Why do you think people pay so much for support for enterprise server software or enterprise databases? Because the products are expensive, that makes it possible to charge much for support or other third-party products. When the products becomes cheap no one pays as much anymore, it indicate low value. You wouldn't pay $5000 for a car stereo in you fiat, right? Any business or sale-oriented person knows this but most tech-people don't.
Re:Anybody forgot to mention Microsoft? (Score:4, Insightful)
Microsoft is possibley the most profitable company at this time. And remember Bill Gates was, atleast initially, more technically inclined. For a moment let us forget about his (questionable) marketing strategies and look at the company. He almost single handedly set up a software empire and that too without an MBA from Harward.
Now regarding the strategy used by Bill, let us analyze this - Bill Gates and John D. Rockefeller built their monopolies using more or less the same technique In the 1980s, Bill Gates got the computer manufacturers to pay him the price for Windows for each computer they manufacture, regardless of whose software is on it. In the 1870s, John D. Rockefeller got the railroads to pay him a rebate for every carload of oil they ship, regardless of whose oil it is. Same deal! How did they manage such deals? I don't want to draw allegations but maybe by bribing the officials of the other companies.
Anyways, according to me, it shouldn't matter who is running the company as long as we have some level headed people at the helm. People who do not get sucked in by heavy jargons and latter blame it on the technology. If the company expands and the owner is not able to control it, then by all means he/she should step down and let others take over. No point in building an empire and bringing it down just for vanity.
Isn't it about time... (Score:5, Insightful)
...But I'm not going to hold my breath...
Re:Founders not necessarily necessary (Score:4, Insightful)
Neither is the presence of a higly trained Harward grads. Why do people fail to realize that one of the oldest companies like Ford etc were not started by mangement guys. These are relatively a new breed of people popping up. I am not diminishing their importance but let me tell you that being totally dependent on these guys is not good either.
Even if you do consider dotcoms, I agree that most of them perished becoz of bad judgement call. But hey, the whole world bought that idea. You cannot just blame some techies for this and brandish them as useless. Even now, I believe that for a company to be successful even it does not have the founder around, it should atleast have some technical guys around not just some fat ass white guys.
The flip side (Score:5, Insightful)
Comment removed (Score:5, Insightful)
management vs. actual work (Score:3, Insightful)
Greed (Score:4, Insightful)
A great deal of our current economic situation was caused by tech companies doing just this. The worst cases are obviously where company execs sell out leaving all other stock holders and employees holding the bag but it really isn't much better falsely inflating these companies. People are still buying tech. Electronics and other techie gizmos are still hot selling items. Companies are still making a profit from them. There is no real reason for the tech market not to be booming. It's just dead because of the few individuals that were greedy and shortsighted.
Also I think the concept of day trading is partly to blame. People don't buy stock for long term value. They buy it, try to make a few quick bucks, and sell it again. They don't care where that company will be in five years. They don't care where the world will be in ten years. It's no better than a get rich quick scheme.
Research and technology drive society forward. They give us new abilities, raise the standard of living, and give people something new to buy. They may not pay out in an immediate obvious way but they are what fuels our economy and lifestyle and should be protected.
Re: Businessoriented employes(was:Lets not forget) (Score:5, Insightful)
Pardon the tangential subject as we wander from over-managment to bad business models. Really, no amount of good management can fix a broken business model. Good management might rewrite a broken business plan and fix an ailing company, but so might bad management rewrite a perfectly function business plan. But back to the point.
Open source development frequently comes down to an issue of profit through service rather than the product itself. In the case of one kinda big company [ibm.com], they're spending some large money developing [linux-ha.org] and integrating open source solutions to phase out some of their products [ibm.com]. Sometimes it works better providing services rather than constantly maintaining one's own proprietary software, or at least it may become easier to maintain when your customers sometimes volunteer improvements.
The same give-away-the-product, sell-the-support system works for some smaller companies [redhat.com] who sell to home users. Good tech support is certainly worth plenty, especially when even mature software [microsoft.com] can sometimes be confusing.
Re:Stockholders are the problem... (Score:2, Insightful)
in fact markets have become astoundingly jumpy and irrational - whether in recent boom or bust times.
things will settle soon enough, and we can get back to longer term investment - rather than the recent (last 10 years) spate of speculation.
Re:Lets not forget (Score:5, Insightful)
Management folks can readily see the problems that arise when techies fall so in love with their technologies that they stop thinking about what the customers want, or whether their latest interests advance the needs of the company. In fact, many consider such narrow-mindedness to be a feature of all engineers. Alas, I rarely encounter managers who see as clearly what happens when managers fall in love with their own special areas of interest and ignore everything else necessary to make the company succeed. It's really no different in principle from the other kind of short-sightedness except that it's usually tied up with a lot more ego, more VAST heaps of useless activity, and more blatant mind-numbing stupidity than just about any other idea in the world (except perhaps the "We are from the government and we are here to help you." thing). Since managers generally hire and fire, they are usually better at getting power and wiping out anyone who doesn't share their narrow-minded views. That makes this syndrome the single biggest company killer I have ever seen, yet it seems that the schools that hand out MBAs don't bother to make it the number one lesson for up and coming manager types.
Perhaps they should have to read every Dilbert cartoon ever penned before they are allowed to get their precious MBAs. The problem in companies being killed by this syndrome is not that there's "too much management". It's that the managers are committed to a horribly distorted view of what they are supposed to be doing.
Re:Grammar nazism (Score:2, Insightful)
Very Scary (Score:5, Insightful)
However, we were missing the dot.com boom and the board decided that additional management and new financing were just what was needed to grow the company. Initially the idea seemed like it may be a good thing: it would raise additional financing, which would allow us to accelerate the development of our product
In hind-sight this turned out to be a bad move
Lessons learned: next time keep the 'professional managers' out until you are ready to detach and walk away
Natty
Machiavelli - On Troops and Mercenaries (Score:5, Insightful)
Any venture capital company should read the chapter "On Troops and Mercenaries" - substitute - Mercenary for Hired Gun Management. Machiavelli say's "Mercenaries and auxiliaries are useless and dangerous" - further on he says "they [Mercenaries] are brave among friends [read the board and head-hunters]; among enemies they are cowards
Basically what Machiavelli goes on to say is that troops don't really fight for money, but for vision and belief in the Prince. If an employee does not believe that the CEO is in for the long haul why should he be?
I did OK money wise, but this did not stop me going into massive depression for about a year after I was replaced. It feels like somebody messing up your toys....
Re: Businessoriented employes(was:Lets not forget) (Score:4, Insightful)
In comes some business yahoos (pardon the term) who don't know squat but have lots of financial backing. They conglomerate a bunch of profitable companies and manage to lose a ton of money... of course, not *their* money. Their only goal is to IPO, cash out, and leave the employees and customers holding the bag.
It is a rare individual indeed (Score:3, Insightful)
No mystery there.
Re:I disagree... (Score:4, Insightful)
Then how come you guys suck at it so much?
Garg
Steve Jobs (Score:4, Insightful)
Now he's back at Apple and things look golden again.
Perhaps the cure for some of these "sick" companies is to get the founder back to inject some of the old passion back into the company?
Like him or loath him, Steve Jobs has passion - and that shows in the products. Probably more than anyone else. (I still have my old NeXT boxes)
RIP Ricochet (Metricom) (Score:2, Insightful)
Then again, can't be as bad as a company I later worked for -- 22 VP's ran a ~100 person company (and multiple directors had no employees they directed.)
There are certainly examples of successful companies that ousted their founders (Cisco being probably one of the biggest successes.) The question is, what would Cisco have been if the founders were kept?
Generally, engineers (and scientists) make poor managers, but engineers and scientists can make senior researchers/architects/designers alongside the MBA's to make sure the books add up and the sales force brings in business. Most VC's, as the author pointed out, are looking for quick profit and bumping off the people with the $.25/share options and seniority is a quick way to make it.
Re:good point (Score:3, Insightful)
But to be fair to the original poster, the suggestion was not that stock in and of itself is a poor investments. He was suggesting that long-term contracts could help prevent managers from "decapitalizing" firms, which would make them even BETTER investments.
Re:Larry Ellison (Score:3, Insightful)
Both of those are "RAD" tools, which I think is not what the parent poster meant. The problem with Oracle is not writing SQL fast, the problem is the very obscure errors that happen randomly and need an experienced DBA to solve. And I believe this problem comes straight from the "professional management" mentioned in the article.
Oracle today is like IBM, no one ever got fired for buying Oracle. But most of the people who buy Oracle should be fired. In the vast majority of cases, Oracle is overkill, smaller DBMSs like MySQL or Postgres perform better and have a much lower TCO. Being able to handle databases of any size means an enormous amount of internal configuration options. I have seen errors in Oracle that took weeks of consulting from Oracle itself until they found someone who knew what it was. I would never recommend Oracle for a database with less than a million tables or a billion records.
But, when the final decision is made by an MBA, a consultant is hired, because the manager is technically unable and lacks the necessary balls to make a decision. The consultant is paid, roughly, based on the value of the item to be bought, so higher consulting fees can be had from recommending Oracle, rather than MySQL.
Re:good point (Score:3, Insightful)
Most countries have company law which includes the notion of Fiduciary duty. This means that the directors have to walk the fine conflict of interest between enriching themselves, and acting in the best interests of the company.
A director who does not act in the best interests of the company, even if it is not in his/her best interests, is failing in their Fiduciary duty, and can be legally challanged.
The problem is that most shareholders are not aware of this fact, and that without cooperating from the company it is very difficult to track down other shareholders (for the purpose of bringing a class action suit against the directors).
A secondary problem is the lack of direct involvement by shareholders. Directorships are often negotiated by company management (so the company managers pay the directors for their services); in turn the directors are responsible for determining management remuneration and working conditions. Its a simple you pay my back and I'll pat yours scenario. More direct shareholder involvement would see the shareholders appoint the directors, avoiding the spiral of self-indulgance.
Re:Lets not forget (Score:5, Insightful)
Unfortunately, the "ideal" model for companies today seems to be one where only managers are employed, everything else is outsourced.
Much of this is because of the Stock Market (Score:5, Insightful)
The original idea behind stock was as a way for the company to get money to grow. The stock buyer was counting on getting an annuity - the dividends of the stock. As a result, the upper bound on the current value of the stock was set by the interest rate and the dividends the company paid out - if the interest rate was 10%, and the stock paid $1 in dividends per year, then if the stock cost less than $10/share it was undervalued. If the stock cost more than $10/share, you would do better to invest your money in a bank.
Thus, stock holders were looking at the long term - what is the company doing to increase the dividends?
But then people noticed that if they could make a short-term change in the expected return on the stock, the current value would move. Thus, they began to change the short-term operations of the company, to change the estimated dividends (and thus the current price of the stock), then SELL and move on.
Thus stocks became trading cards, and the current era began. Buy into a company, manipulate the stock price, sell, repeat. (OK, PROFIT! there, I said it, you don't have to.)
Now, consider this - What if the capital gains tax worked like this:
If the gain is realized in less than 6 months, then the gain is taxed at 90%.
If the gain is realized in 6 months to 1 year, then the gain is taxed at 75%.
If the gain is realized in 1 year to 5 years, then the gain is taxed at 50%.
If the gain is realized in more than 5 years, then the gain is taxed at 0% (i.e. not taxed).
Now, consider these scenarios:
You buy into an IPO, sell when the stock peaks a month later, sell. You get nailed for 90%. Since that is the case, there would be MUCH less demand for the stock, and it wouldn't shoot up so much.
You buy into a company, manipulate the stock price by gutting it, and pop that golden parachute a year and a day later. You get nailed to the tune of 50%. You are STILL discouraged from these games.
You buy a house. Five years later, you move from Silly-con Valley to Wyoming, and from a $500,000 house to a $250,000 ranch. You pocket the $250,000, since it isn't taxed.
I was watching a show several years ago on PBS, wherein a representative of the Federal Reserve was debating a person who's position was "The Fed should just leave the damn interest rates alone and let the market correct itself." The Fed guy said "But we have all this information, and it would be wrong for us not to provide feedback to the system".
When he said "feedback to the system" I had an epiphany - I am an electrial engineer, control systems are something I've studied at length. Unlike an economist, engineers are trained in mathematical tools to examine systems for stability. One of the things that will make a system unstable is too much lag from stimulus to feedback response - it's called "phase margin". The economy has a very LARGE phase lag - making a change to interest rates today will not take effect tomorrow. Also, there is "gain margin" or frequency response - the higher the frequency response the faster the system will react, but too much will cause oscillation. Systems with a large phase lag need to have a very low bandwidth, or they will oscillate. What my proposed cap gains tax would do is reduce the bandwidth of the system by reducing the gain at high frequencies.
Now, you can apply a simple check to my proposal - who will it piss off? The Republicans won't like it, since it prevents the very sort of short-term market manipulation that makes money for fatcats. The Democrats won't like it, because it allows middle-class folks to make money long term (so they can retire without relying on the government for assistance).
And I assert that anything that pisses off both the Republicans and Democrats cannot be a bad thing.
Re:amen, brotha... (Score:4, Insightful)
Because growth is what drives stock value - its the combination of current value (what you are selling) plus the value of future growth (what addtional sales, above current, you'll make in the future).
If you are growing, and people believe you will continue to grow, your stock rises to reflect the value of that growth. If you don't grow, your stock drops to the value of your existing revenue stream. If you simply make x dollars of profit month per month, your company is going to have less value than one where the X grows consistantly by 10%.
In the end, it's all about fairly valuing a stock.
He was always the soul... (Score:2, Insightful)
Re:Larry Ellison (Score:3, Insightful)
As a result, Oracle quality getting worse even fatser than quality of Microsoft. At least Redmond guys re-write some code from time to time. Oracle just applies patches.
No wonder that you still can sometimes swap selected fields in a SELECT statement and Oracle will cancel the query with internal error code. I remeber they've been trying to fix it since v6.0, but the bug has been appeared again and again.
Oracle is another example where the core doesn't care a bit about a product architecture, they care only about new features and the strategy is just to hire more and more developers to produce patches and test them.
Of course, while the army of developers is managing patches, the army of DBA's is managing that peace of work on the field.
"As long as there were no machines, programming was no problem at all; when we had a few weak computers, programming became a mild problem and now that we have gigantic computers, programming has become an equally gigantic problem. In this sense the electronic industry has not solved a single problem, it has only created them -- it has created the problem of using its product." - E.W. Dijkstra Turing Award Lecture, 1972
Re:Anybody forgot to mention Microsoft? (Score:5, Insightful)
Gates: We've noticed that you were the leading distributor of PC hardware last year. You were our biggest OEM customer... You sold $100 Million worth of Windows Licenses.
Dell: Our new distribution centers are really state of the art.
Gates: Microsoft is trying to come up with a way to save you money on the copies of Windows that you sell. In fact, if you buy a copy of Windows for every PC you sell, we'll sell each copy to you at a 50% discount.
Dell: (thinking to himself that Dell sells 90% of its PCs preloaded with Windows) Hmmm. That would save us quite a bit of money.
Gates: It sure would. Sign here please.
Now, Microsoft makes less money from Dell, but since Dell now has a strong advantage in the marketplace (it can sell PCs for less) other companies are willing to come on board with Microsoft for deals that are less sweet than the 50% that was given to Dell.
The next thing you know, Microsoft has created a pretty massive disincentive for Dell (and others) to look into other OS technology.
Also, every time the OEM license contracts are re-negotiated, Microsoft has benefitted more from the aforementioned disincentive and can ratchet the profits right back where the investors want 'em.
No bribes are necessary. All of the above is completely ethical and is fundamentally no different from lots of business agreements that are made. You may think Michael Dell is stupid for going along with something like that, but look where his company is today.
Re:Lets not forget (Score:2, Insightful)
Forcing them to read Dilbert cartoons is not going to change them.
Maximising Shareholders Value (Score:2, Insightful)
One of the essential problems is that, by law the management are required to maximise shareholder's value. There are lots of things that management can do that will increase shareholder's value (i.e. the value of the stock) in the short-term but may be detrimental over the long-term. Acquiring other companies is a typical action. Alternatively they might try to boost profit in the short-term by slashing staff or research budgets and then angling for a buy-out by a big multinational. All these things are easily defensible. The stock goes up, the shareholder's see their "value" increase and everyone is happy.
On the other hand we have long-term actions such as basic research that are far harder to justify to shareholders used to the instant returns of recent years.
If the stock market has less speculators we'd probably see less of the fast money which in term might lead to shareholder's valuing long term actions more. However there will always be people who attempt to make short-term returns, and while this is the case there will always be the urge to cash-in as soon as possible.
Re:Bob's got it wrong this week (Score:5, Insightful)
What do they mean? Maybe the tradition is to work 12 hour days before a major product release. Maybe long careers are built on the pride of accomplishments past and a look forward at a well-incentivized pension plan. Maybe a company hits the research jackpot frequently and attracts top talent because of how it handles rewards for new patents, etc.
All of these factors effect the competetiveness of a company, and any smart manager will take them seriously. All of the above are simply characteristics of a company. With poor management they will be undervalued and destroyed, and with good management they will be valued and encouraged, and the company will thrive.
You may not be able to declare profits each and every quarter, but that will help keep your stock from becoming overvalued and it will encourage the kind of investors that look deeper into a company than only at its stock price. This will lead to steady, sustained growth and less volitility than the competetor who is run by a short-sighted management team.
What's wrong with nuclear reactors? (Score:3, Insightful)
Re:Hang on a minute! (Score:5, Insightful)
Then i quit.
Professionalism can be a barrier to entry, though (Score:5, Insightful)
For instance, I'm pretty sure it was a lot easier to get started in business 100 years or so ago -- you had a trade, and you did it, and "managing" wasn't something that you did as a career, it was something that you did to enable yourself to do all that other stuff you wanted to do (say, in Walt Disney's case, making cartoons).
Now, with so many fields professionalizing so rapidly, it's very hard to get into them at all unless you've got the appropriate professional credentials and/or (usually and) experience. (Oh, yeah, having friends in high places helps too.) Woe betide you if you don't have these things, because you will suddenly find yourself having to be twice as good as the existing competition to even get into the field, which can be tough when you're competing against people with 20 years' experience.
And sometimes having your field taken over by august sages and avocationists is not a good thing, either. To use an example I'm most familiar with, look at how dynamic, prolific and vibrant SF publishing was in the 1960s and 1970s. Now that it's been professionalized and commoditized so much, all that dynamism, exuberance (and not necessarily even youthful exuberance), and prolificness (prolixity? although not in the strictest literary sense) has gone out, and it's damn near impossible for a newcomer (of any age) to get published.
All fields need newcomers, beginners, and dabblers, so professionalism is not necessarily a good thing 100% of the time, especially since the trend lately in technology (and other fields) has been to refine, as opposed to innovate. Where are the innovators going to come from, if we don't encourage people to start doing something? You'd be surprised what novel approaches the "beginner mind" can come up with. Ask me about it sometime...
You can't buy soul (was Re:Steve Jobs) (Score:4, Insightful)
I am interested in the Wall Street analysis that Apple perhaps has one of the worst board rooms in the industry, but then leadership by commity almost killed the company before. I see Apple as Steve's ship. He doesn't give you a good idea of where he's sailing, but you know that there will be some pretty cool ports of call along the way.
It's not like other companies that flounder around with too much market research or board room squabbles about where the ship should sail. It's almost like Steve puts down a 'this is really cool, we should do this' gauntlet and the board and the rest of the ship pull the oars to get there. If you don't like where Steve's going, well there's always Microsoft or OpenSource.
It would be refreshing is more companies were like this, rather than drafting in Apple's wake.
Re:Ummmmmmm (Score:4, Insightful)
No, I do not. I think personal guns are uncalled for, but military weapons are required for national defense.
In my book, nuclear reactors are no worse than fossil fuel power plants. Our atmosphere is polluted with green house gasses, coal miners used to get black lung or trapped in mine collapses, and we'll run out of these resources. The nuclear industry has a better safety record than the fossil fuel industry, the nazardous waste can be contained, rather than inhaled daily.
And, if you're talking about nuclear weapons, they have kept a third world war from occuring for some fourty years. As long as everyone realizes how catestrophic the next world war will be, it won't happen.
I think Suddam realizes this, but I'm not sure if Bush does. The US government's shyed away from Mutually Assured Destruction. Ever since the Evil Empire broke down in financial ruin, it's been shunned. We need to make sure that every tin pot dictator with a nuke knows that if one of our cities is ruined by an atomic explosion, his capital will a memory. It sounds terrible, I know, it is, but so is war.
Peace is always the answer. The question is, how are you going to ensure it.
The Main Factor Goes Undiscussed (Score:3, Insightful)
I've started a few companies, and though not rich myself, everyone I've ever dealt with in the business community is. And only 1 person out of roughly two hundred was not rich prior to starting their company. And, universally, what was the single fact best correlated to their company's success? How rich they were before they started tho company.
Gates was rich, and went to Harvard, a school, primarily (especially in 1973) for rich kids. That's where he met Balmer. Money begets connections, which beget success. Other than being rich, the most important thing about Gates was that he isn't stupid.
I can't find an online bio of Ellison or McNealy, but dollars to doughnuts, their daddies were rich and well connected. Do Horatio Alger stories happen? Yes, of course. Andrew Carnegie was one. That's part of the reason why you hear so much about it, it makes good PR to project the image that most successful people "earned it."
But, in the common use of the word, it's not true. Under, over, and mis-management all matter, as do brains, staying in touch, technical knowledge, and people skills. But, the most important of these is a *distant* second to money and the connections it brings. Actually, the most important in this group might be third, since my guess is that luck is second most important. (Though you do, to a large extent, make your own luck.)
Is this mere cynicism? No. I wish the world were different, true, but it is not, so, in order to act most effectively, one must understand the reasons for things. I don't mind that people are rich. I do mind when they attribute it to their "brilliance" when the empirical facts (and I do study the subject) simply do not support such an assertion.
It's a complicated subject, and I'm not saying that rich=success. I am saying that, in the equation for success, rich has the biggest factor in front of it.
Re:Counter point - Balance shortterm/long term! (Score:4, Insightful)
IBM may be a good example, but it is a bad model [forbes.com] ethically and pragmatically example. Its patents hoarding heightens the barrier to entry, because basically to do real business in IT now you have to have enough fundamental patents to bargain on IBM out of paying them huge, confiscatory royalties on everything under the Sun.
Actually, according to Cringley's standards [pbs.org], IBM patents are part of the problem, not of the solution.
And remember, there is no such thing as IP [www.gnu.org]!
Re: Businessoriented employes(was:Lets not forget) (Score:4, Insightful)
Clearly there were some bad business plans during the "boom," but what really killed these companies was not bad business plans per se, but management that focused solely on increasing the stock price of the company.
In short, there was less money to be made in building a solid business than there was in erecting the shell of a business and spending money keeping it afloat until after an IPO. The original investors could then sell their shares at vastly inflated prices and abandon ship. The people building these shell companies could easily quadruple their money. Building an actual profitable company is much harder, and the proceeds are generally far smaller.
On another note. I think that you will find that Free Software service companies (like RedHat) are the wave of the future. The reason for this is simple, they are targetting a business sector that has an absolutely astounding profit margin. Microsoft currently has a profit margin of over 30%. There is still plenty of money to be made undercutting Microsoft's prices. You might not put a $5000 stereo in your fiat, but ask WalMart which stereos make the most money and they will tell you that they make far more money selling $100 stereos than all of the $5000 stereo vendors put together.
Re:Lets not forget (Score:3, Insightful)
I'm not sure I'm willing to move to a Third World country...
The Decline of Tech Support (Score:4, Insightful)
Typically, the management is "business-based" rather than "technically-based" and so they think like accountants. Things that make sense on their spreadsheet don't always make sense in the real world.
Such organizations do not value employees that are multitalented. they tend to force people into a narrowly defined role, with no chance for growth, or advancement, or exploring other ways to help customers besides just answering as many calls as possible, getting the customer off the phone as quickly as possible (never mind solving their problem) - as a result - workers who are bright, creative, more likely to solve problems, are hounded out of such organizations as "poor performers" etc. I've seen this happen more times than I care to recall for you here. And as I call in to support lines at other companies, I see things are much the same everywhere. The trend is away from salaried competent professionals, towards hourly-paid mindless phone monkeys. And this trend is driven by "business-based" management. Where I've worked, when the managers were technical people, it may not have been a volume business, but customers were happy, because when they did get through to a support rep, they talked to someone who could answer their problem. In other organizations where I worked under non-technical people, it was quite the opposite.
Re:Great idea BUT... (Score:2, Insightful)
I agree that the current system is flawed, as stock ownership is no longer regarded as giving a small loan to a company. Yet, we still need a way for small company's with an uncertain future to tap capital when necessary. I fear that if short term gains are not allowed, many of those with money will have little incentive to invest.
Personally, I am not too worried about any of that stuff. I believe the rule of business should be caveat emptor. There will be abuses, but I don't think the cost of those abuses is greater than the cost to society in lost capital...
Its a sad fact, but going all the way back to the jews forced to live on the island Ghetto in Venice till now, society has always had a tense relationship with those who have money and are willing to lend it. We can rant and rave, but we need their money.
Re: fired for using Oracle? (Score:3, Insightful)
My last employer, for example, set up Oracle back when it shipped on floppy disks for the installation!
Once you have all your important/critical data in an Oracle database, it becomes nearly impossible to justify pulling it all back out and migrating to something new.
True, you grit your teeth every time that maintenance renewal fee comes up (another $35,000 please!)
I'd really question anyone just now planning a new Oracle database purchase -- but Oracle is probably living nicely off all those who bought into it years ago.
Re:I disagree... (Score:3, Insightful)
And that is just why often the best managers have been a techie themselves. They understand the work being done and the difficulties involved. They don't have to wonder, they know how to deal with real life instead of wondering why things are not perfect.
If the problems are a result of the project structure or content (such as... _testing_), thats where the manager can make changes. If the problems are a result of lack of experience or expertise in the people supposed to do the work, thats where he can make changes too. If the manager only wonders and bitches, it's time for a new manager.