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It’s better to find ways to make more money than to save it. There’s a floor but no ceiling in much of what we do.
by 0xEFF 6y ago
It’s better to find ways to make more money than to save it. There’s a floor but no ceiling in much of what we do.
- deleted 6y ago[deleted]
- tehjoker 6y agoThe ceiling is the size of the addressable market.
- jedberg 6y agoI wouldn't say it is better, just different. Both have value. If you find a way to save millions, that might be quite worthwhile, because that might be easier than building something new that makes millions of dollars. It's all about ROI.
- melling 6y agoPeople shouldn’t downvote him. He’s right. i’ve done lots of small things to save time and money in the past. Management really doesn’t value it as much as making money or working on more visible projects. Telling someone that it only took me an hour to eliminate an hour of someone’s work every week doesn’t go far.
- jedberg 6y agoThat's just bad management, not an axiom.
- VLM 6y agoSomeone was building an empire by having employees do manual data entry instead of parsing json files. All the way up the mgmt tree there are fewer direct reports. Nobody ever gets a job title promotion by having fewer direct reports. Even worse, someone else now has to explain "why they did it wrong to begin with" regardless if the replacement technology existed or not at the time of original process creation.
- jacobr1 6y agoA lot of this just visibility and internal salesmanship. Having an engineer standup at an all-hands and be lauded for saving $X million right after the sale-gal is lauded for closing the deal with $BIG_CO is something I've seen done, and it does it get recognized.
- buran77 6y agoMaking a million or saving a million are equally important in the end assuming one of them doesn't require particularly unreasonable ways. Sometimes it happens that the floor is really close to the ceiling and lowering the floor is the easier thing to do. Go for the low hanging fruit first. If you have too much useless clutter it makes sense to remove it rather than break down walls to expand.
- grecy 6y agoCertainly many companies prefer this approach because so many goals are tied to increasing revenue, and certainly personal bonuses are too. Very few people get rewarded for decreasing costs. In my last (big!) company it was never even talked about. Increase revenue was the only goal. Also making more money is better, because it means growing the company with more employees and more job safety for everyone.
- rriepe 6y agoThanks. This comment blew my mind. This perspective is so far on the other side of things that I never considered it.
- stormdennis 6y agoIt feels like saving money might also be more environmentally friendly than growth.
- BurningFrog 6y agoIf your revenue can grow exponentially, that's probably the right priority. Most companies aren't like that though. Know your company! Also consider if you can run out of money before growth kicks in...
- hinkley 6y agoCompanies that only ever learn to spend money to make money tend to flame out when their market matures. They never learned how to sustain.
- around_here 6y agoAlso know your reporting metrics. Increasing revenue is growth, which capitalism jerks off over. Profits, not so much.
- mring33621 6y agoYessir, Mr. Belson!
- fphhotchips 6y agoThis heavily depends on the industry you're in. In software, yes this may be true, but in low margin industries it's absolutely not. The maths is simple. If my margin is 1%, and you make me an extra $100, I keep a buck. If you save me $100, I keep that whole $100. If I'm smart, I can use that to drive my prices down, and take more market share without reducing my margin. Obviously it becomes less clear if your margin is >20% or so.
- hvidgaard 6y agoIf it's a high margin market, you should absolutely focus on capturing more revenue, it gives you more available capital to work with. Once that slows down or you get competition, you can focus on improving your efficiency.