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Big companies make decisions all the time that harm long term prospects (sometimes in ways that are difficult to measure) in favor of obvious short term gains.
by codys 7y ago
Big companies make decisions all the time that harm long term prospects (sometimes in ways that are difficult to measure) in favor of obvious short term gains.
As an example, when I worked for IBM, they furloughed the entire Systems technology group (essentially the folks working on things that aren't pure software or contracting) for a week.
This was done purely to reduce the payroll for the STG so that it's income would look better on the quarterly earnings.
Neither the inability to get anything done for 2 weeks (furlough was staggered so only approx half of folks were out each week) nor any of the follow on effects on project or work force was not enough to impede this type of roughshod pursuit of quarterly accounting numbers.
- baddox 7y agoSure, but now the claim is simply that companies focus on varying time scales, and sometimes those time scales are shorter than what some people would like to see. That’s fairly clearly true, but it’s a very different claim than that big public companies optimize for the next quarter over everything else.
- perl4ever 7y agoNote that this is unrelated to my (original) comments and I wasn't expressing an opinion on whether companies "optimize for the next quarter".
- perl4ever 7y agoSure they do, but people can and do get just as angry when companies ignore short term harm with the promise of long term gains. So the issue isn't short term vs. long term, but rather being right vs. wrong and honest vs. dishonest. It's really hard to always be right. I mean, if you want "long term thinking", does that mean that WeWork is a better model than Boeing? Because people seem to hold it up as a failure of capitalism just as much.