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One reason it's true is because companies only measure actual cost, not opportunity cost. How much did it cost Yahoo to have every tech-savvy person in the worl
by peterbonney 10y ago
One reason it's true is because companies only measure actual cost, not opportunity cost. How much did it cost Yahoo to have every tech-savvy person in the world switch to Gmail because of Yahoo's lousy (and Google's excellent) security infrastructure? Where the tech-savvy go, the tech-unsavvy often follow. As they did with Gmail.
But lost revenue opportunities don't show up in the bottom line, so cost-focused managers don't think about them. And they conclude it's "cheaper" to not invest in this or that thing that their smarter competitors are doing.
"What gets measure gets managed." People think this (apocryphal) Drucker quote is advice. It is not advice. It's a warning.
- richmarr 10y agoNot sure I agree that it was Google and Yahoo's respective security architecture that caused people to switch, even tech-savvy people.
- karmelapple 10y agoFully agreed. It was all about a lot of free storage space.
- peterbonney 10y agoSure. But all the things Gmail offered were things that probably looked like lousy investments to Yahoo. Why offer more storage? Why have better spam filtering? Why have better security? It all costs money!!! The point is only looking at actual cost, not opportunity cost.
- richmarr 10y agoYep. Good clarification.
- jhanschoo 10y agoActually, it was the free space. Everyone who used Gmail didn't trust it very much and was wary about Google sharing their info, especially as it was showing ads related to your email archive.