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I worked for a company that had a similar take on spending. The company was extremely profitable and brought in greater than 1 billion dollar in revenue. Yet
by proee 7y ago
I worked for a company that had a similar take on spending. The company was extremely profitable and brought in greater than 1 billion dollar in revenue. Yet any PO that was greater than $100 needed approval by the CEO. Not only that, the PO had to be typed on a manual typewriter (this is 2007) using carbon paper, and hand-delivered to a number of people to start moving up the chain. The process intentionally took MONTHS for the approval to go through.
This resulted in engineers that would purchase their own equipment and bringing it to work to use because they couldn't wait a month for a $200 piece of equipment. It was common to have lab benches full of used equipment from ebay that engineers purchased to get their jobs done. This created an interested dynamic in the lab when it came to sharing equipment (most of it was not shared). Also, scary to know that since a lot of used equipment was being relied on, a large portion was not calibrated and could be outside spec.
There is a lot of value in creating a thrifty company culture, but sometimes it goes too far and hinders the ability for engineers to do their job. In the end, everyone is responsible for ensuring the purchase they make are wise and necessary for the success of the company.
- barbecue_sauce 7y ago$100 seems like a pretty extreme threshold. Would make more sense to have a budget for a group or an individual, then only require approval once the budget has been depleted (though I guess this could potentially incentivize overspending instead).
- deleted 7y ago[deleted]
- taf2 7y ago* 1000 to 10000 people making those $100 purchases maybe not too extreme? Said they posted over a billion so I’d guess pretty large number of employees
- digsy 7y agoThe issue isn't the $100 limit - the issue is having the CEO give approval. I would expect that such a small amount would be approved by someone much closer to the engineers on the hierarchy. Not to mention what a poor use of the CEOs time!
- selectodude 7y ago"let's pay this guy $800/hr to approve $110 purchases"
- freyr 7y ago> what a poor use of the CEOs time! Not if it keeps him off Twitter.
- cosmodisk 7y agoCare sharing the name of the company? Right now I enjoy the complete opposite where I work...
- zbrozek 7y agoAt a guess, Linear.
- proee 7y agoYou are correct :-)
- CamperBob2 7y agoLT had that kind of policy? Manual typewriters?! Wow, that's not something I'd have expected.
- madengr 7y agoProbably a hold over from goats mowing the grass, or was that NS?
- dahtguy 7y agoMy mind is blown! I've always associated Linear with precision work, can't believe it was all built on eBay equipment. Doesn't seem very Jim Williams...
- pbreit 7y agoSounds like a super effective policy.
- clouddrover 7y ago> This resulted in engineers that would purchase their own equipment and bringing it to work to use because they couldn't wait a month for a $200 piece of equipment. That's a mistake. You should never pay other people's costs. If the company wants to put itself in a position where work is delayed by a month for the sake of $200 then that is the company's cost to pay.
- TaylorAlexander 7y agoIt’s a mistake if the company is healthy. But if individual workers are in a position to get a performance bonus or impress their boss, it may be worth it for them to spend some money to ensure that would happen. It would also be a bad work environment.
- clouddrover 7y agoIt won't impress anyone. All it will do is incentivize them to see what else they can get out of you for free. They won't respect you if you don't respect yourself.
- ksec 7y agoAnd yet if you don't get the job done due to slow company approval process you get the blame for it, and possibly at the cost of your Job. It is rather unfortunate that this isn't a minority but many of today's company, from SME to Fortune 500 operate in a similar fashion.
- isbvhodnvemrwvn 7y agoIf they make it such a hassle to spend $100, what do you think their bonus policy is like?
- panpanna 7y agoWe once built a CPU farm using own parts. It was stupid but you have to get the job done. Unfortunately this meant that we later had to fight management really hard to pay for cloud services. We lost that battle.
- dmix 7y agoUsually cost cutting at a high-spend early stage company entering a mature phase doesn't usually meaning counting pennies at the expense account level. High growth companies that rapidly expand as they try to penetrate the market and conduct plenty of R&D have lots of exploratory avenues and quickly-signed deals with partners that could easily result in cost saving without affecting the primary business model or the vast majority of workers. This is different than an older company with zero growth potential trying to find more profitability by choking out their squeeze the pennies from an existing business in order to keep investors happy.
- gpm 7y agoI think there are a few critical differences here. It sounds like this is a retroactive review, not an approval process. Which should mostly get rid of any waiting for approval problems. Also, there is no typewriter involved ;)
- deleted 7y ago[deleted]
- fencepost 7y agoWhen engineers quit did they just back a van up to the building to remove their property?
- hef19898 7y agoI had two cases like this in my career. The first one was a cost cutting initiative during which the managing director of the second largest production site signed POs for office material. At the same time procurement, strategic and operational, signed frame contracts and created POs against these worth millions for raw material and stuff like that on group level. The second case was a company in which every single drop ship order from there customers had to be ordered individually from the dropshipper. Every such order had to created manually and needed managing director EMEA approval in writing.