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> in your case was the consultancy owned by the people making these short-term profit maximizing decisions[?] It was a publicly-listed company, so that'd be a

by nkoren 8y ago

> in your case was the consultancy owned by the people making these short-term profit maximizing decisions[?] It was a publicly-listed company, so that'd be a yes. Profit is obviously over time a necessary condition for making a sustainable business. But it's definitely not a sufficient condition. I think there are a huge number of people who don't understand this. Eg.: when I see people clambering for TSLA to make a profit... I think they're wrong. Or, at least, mostly wrong. TSLA has been unprofitable in the service of dramatically (and rather effectively) expanding both capacity and market share. Those are excellent reasons to be unprofitable. And TSLA still obviously has a lot more room to grow in both respects, so in this situation, trading profitability for growth is a good decision. (exhibit A: Amazon)

njarboe 8y ago
>> in your case was the consultancy owned by the people making these short-term profit maximizing decisions[?] >It was a publicly-listed company, so that'd be a yes. I'm a bit confused. I stated that public companies are not often owned by the people who mange them and that is a real problem. You are asserting that all publicly-listed companies are managed by their owners. That is just wrong. I own both TSLA and AMZN and of course there are hundreds of things that need to be done to make a sustainable business. Just talking past each other at this point, I think.
- nkoren 8y ago
  Ah, sorry, you're correct. The company was owned by people who wanted short-term profit maximising decisions (its shareholders). The people actually making the decisions also owned shares, but nowhere near a controlling interest. Anyhow, I agree with your point about companies that are controlled by founders (whether public or not). A (sufficiently pragmatic) visionary with a controlling interest can achieve things that no amount shareholder-focused governance can. Of course they can also drive a company into the ground faster than anyone -- but the heights are reserved for them.

by nkoren 8y ago

njarboe 8y ago

>> in your case was the consultancy owned by the people making these short-term profit maximizing decisions[?] >It was a publicly-listed company, so that'd be a yes. I'm a bit confused. I stated that public companies are not often owned by the people who mange them and that is a real problem. You are asserting that all publicly-listed companies are managed by their owners. That is just wrong. I own both TSLA and AMZN and of course there are hundreds of things that need to be done to make a sustainable business. Just talking past each other at this point, I think.

nkoren 8y ago
Ah, sorry, you're correct. The company was owned by people who wanted short-term profit maximising decisions (its shareholders). The people actually making the decisions also owned shares, but nowhere near a controlling interest. Anyhow, I agree with your point about companies that are controlled by founders (whether public or not). A (sufficiently pragmatic) visionary with a controlling interest can achieve things that no amount shareholder-focused governance can. Of course they can also drive a company into the ground faster than anyone -- but the heights are reserved for them.