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That’s assuming some kind soul in engineering management has the patience and leverage to guide this through 10 layers of purchasing, procurement, finance, lega
by namdnay 5y ago
That’s assuming some kind soul in engineering management has the patience and leverage to guide this through 10 layers of purchasing, procurement, finance, legal etc…
Another likely outcome is that it’s “easier” for teams to switch to another tool (easier in that at least they’re not waiting on a third party for approval) and everyone loses a lot of time
Big corporations are not the most efficient beasts for this kind of situation
- jdwithit 5y agoThis poster has clearly worked at the same kind of companies I have. Plenty of them would gladly burn 10x what it would cost to just buy the damn license on engineering man-hours switching something that's inferior but free. Because it doesn't show up as an expense on the annual budget. The concept of opportunity cost is completely lost on a lot of business leaders.
- sokoloff 5y agoA lot of the driver here is not in the moment short-sightedness, but rather a byproduct of the procurement or other finance processes (ironically often instituted with intent to prevent waste and fraud or make the company more efficient). It’s not just the $250/yr/dev, but rather the requirements to create a new vendor in the ERP morass, to get approvals for an exception to the standards for payment terms (and/or methods), any requirements for vetting vendors, etc. If you’re selling to an enterprise, don’t charge just above whatever the “employees can put it on their card without approval”. If you’re going to exceed that, you might as well exceed it by a lot. (If you’re going to make every developer file an expense report every month, I can readily prefer to do a lot of command line typing rather than filing an expense report… If I automate that for a lot of my fellow devs, I get to do something fun and be a minor folk hero.) https://www.joelonsoftware.com/2004/12/15/camels-and-rubber-duckies/ https://www.joelonsoftware.com/2004/12/15/camels-and-rubber-...
- treeman79 5y agoI’ve seen companies burn half a million in developer time to save 10k or less several times. Oh some JavaScript graphing library is expensive. Let’s roll our own! Heroku meets our needs 100% let’s spend millions to switch to K8 and have a much worse experience.
- sokoloff 5y agoThe 4 hours I spent learning the basics of d3 and then couple hours a night for a few weeks working through examples (of others and of my own design) really gave me a powerful new tool for charting applications. Rolling your own is difficult to justify, but "learn and use d3 (BSD licensed)" seems an entirely reasonable alternative to a high-priced commercial offering.
- grp000 5y agoHow much of that is developers doing it because they want to make something new?
- alkonaut 5y agoIf someone suggests a tool that costs $1k/yr over a free tool that costs $5k/year in extra work, I’m going to die on the free tool hill. Because the $1k/yr tool will disappear when the company goes defunct, or it won’t interoperate with something else and there is no way of fixing it. Or it can’t migrate to the next tool. Or we need to upgrade to an enterprise license because we become 21 developers instead of 20. Or they just bump the cost to $20k for whatever reason. Or the tool won’t work on CI servers because it only works after entering a key in an attended install (yes this is still a thing). Free tools have a predictable and stable cost. I have probably been burned more times from free tools over the years, but the scars aren’t as deep. It’s just a shrug and hoping the other project works when the first doesn’t.
- Closi 5y ago> Free tools have a predictable and stable cost. Unless they suddenly turn from free into a $21/month per person fee.
- 10000truths 5y agoI think he means free as in open source, rather than free as in freeware. In which the worst case scenario is that you are stuck with the last open-source version, but at least you retain full control over your fork of the code and can add features and bug fixes as you see fit.
- alkonaut 5y agoIndeed. Proprietary/Closed-source but costing $0 is the worst of both worlds.
- bluGill 5y agoThen I'll find the fork and use that. We have already done that a few times. There is a reason we audit all the licenses of open source software we have.
- Johnny555 5y agoA big advantage of using free open source software is that the licensing prices will never increase because the company needs a new revenue stream to support its business model. Docker Desktop was free, now it's $21/month, what will it cost next year when Docker needs more money?
- version_five 5y agoExactly. I've never understood why capital or cash expense costs are valued so much differently than salary costs. I've had jobs (like any manager) where I have complete leeway on how I "spend" millions of dollars of people's time, but had to to through all kinds of approval to spend even the smallest amount of money.
- JanisL 5y agoA lot of it is path dependency whereby various practices turn into processes, regulations and laws. On top of this narratives form that guide peoples thinking as to what the right financial decisions are, then people can start to believe these narratives over time without questioning them. Eventually companies can create certain processes or habits on the basis that those narratives need to be true: https://www.epsilontheory.com/what-do-we-need-to-be-true/ https://www.epsilontheory.com/what-do-we-need-to-be-true/
- throwaway2048 5y agograft is a serious issue with purchase orders, its much less of an issue with salaries.
- Macha 5y agoAnother example is if I want a $100 keyboard I need ahead of time VP sign off for the non-standard expense, if I want $10000/mo extra in AWS services I need any other engineer to approve my change
- SmellTheGlove 5y agoThere are a few reasons: - Reviewing purchases should put some reasonable controls around how much software you can accumulate. Adding to the tech stack has maintenance costs, and you don't really want to do it without some sort of review. In this case, it's not the dollars as much as the fit. - With SaaS tools in particular, there are often privacy or security concerns. Those teams should review. Probably want legal's eyes on it to get the right terms in place as well. Again, less about the dollars here, and more about the agreement, risk, required disclosures (subprocessor, etc), and those kinds of factors. - On the spend itself, you'd be surprised how this adds up, especially if folks are signing multi-year deals and not bothering to negotiate licensing. Remember, if it's easy for you and me to buy, it's easy for everyone else to buy too, and it multiplies quickly. Now, on one-off hardware purchases and such, I agree it should be a lot easier. At least at the startup I work at, anything under $500 is just an expense report, so just make sure your manager is cool with it and go for it. But there are considerations here also around stuff coming in that IT or facilities then needs to support - obligating their time with your purchase is something you need to agree on or avoid. EDIT: Also as someone else pointed out, grift on purchase orders is easy without any oversight.
- MattGaiser 5y ago> The concept of opportunity cost is completely lost on a lot of business leaders. A lot of it is that opportunity cost really isn't the problem of many business units. I spent a week building a crappy version of codecov for our few repos. Dev won't get in trouble for that because opportunity cost isn't a thing for us as a cost centre.
- pjmlp 5y agoUnless there is a security audit and the dev has to justify why non authorized software is on the company network.
- marcosdumay 5y agoThis. Buying anything on my organization costs something around $10k. Add your price to this to discover the total we are spending. That's on financial cost. The opportunity cost of stopping technical people to handle the technical details of an acquisition is just huge, and larger the most differentiation there is on the market.
- CyanLite2 5y agoPerhaps you're not understanding corporate bureaucracy. Nobody wants to be the manager who gets fired for trying to save $25k by switching from Docker Desktop to {insert random open source project here}. Not only is it not worth the time or the risk, but the engineering manager's exact purpose is to traverse the corporate bureaucracy. It gives them job security. Plus the engineering manager can negotiate big discounts with the vendor and can brag about that on their own performance reviews.
- oneplane 5y agoThat is not the point he was making. It's about wanting to get the licenses procured but the process being unreasonably laborious so people just don't bother. The problem isn't cost, it's the mess of corporate wastelands.
- whimsicalism 5y agoIt's not the manager, it's some department somewhere else that'll take weeks to respond and then you'll have to chat with them about it and they'll be like "i don't see why this is necessary"
- PragmaticPulp 5y agoI've been fortunate enough to work at companies where engineers were trusted to make small purchasing decisions. It works well for a while, but eventually everyone accumulates a lot of random recurring charges and the company cracks down. $21 is nothing for a one-time spend. $21 per month per employee is now $252/year per employee, but now you also need someone managing all of these licenses and accounting. Every new employee or team change requires some juggling of licenses with associated turn-around times before that person can get started. It's not bad when it's just a couple key pieces of software, but it doesn't take long before every engineer has some mix of 20 different subscription tools and platforms and licenses and you're on the phone with a different vendor every week doing the annual subscription renewal pricing negotiation dance. The sales people know how this works and would prefer to wear you down with endless conference calls until you get tired of negotiating and just pay the new, higher price they're asking. Soon, all of those "cheap" tools have added up to $1000/month or more per employee with a couple people dedicated to managing these licenses and negotiating with vendors all of the time. And it's terrible. When the tool isn't easily replaceable, you deal with it. I'm not sure I see that with Docker Desktop, though. When you get a new hire, do you tell them to submit a ticket with licensing and wait until they can get their Docker Desktop license? Or do you simply write some documentation about how to accomplish tasks without using Docker Desktop so you can remove another external dependency? Teams generally gravitate toward the latter.
- cies 5y ago> requires some juggling of licenses with associated turn-around times This! I've always said that a bit reason for FLOSS to win over the internet server-side is because scaling fast and juggling livenses is just too hard. Especially with the prying eyes of Oracle/MSFT/etc's powerful legal teams and hidden "phone home" code. Going with a LAMP stack was just to simplest way to keep moving at speed.
- londons_explore 5y agoWhat would have happened if Microsoft had put some clause in volume licenses that said "you can use a system unlicensed for up to 30 days before paying for a license". Then engineering can spin up loads of instances to test stuff and scale fast with minimal hassle, and it'll be the purchasing team playing catchup later, no longer in the decisionmaking path.
- posterboy 5y ago> Big corporations are not the most efficient beasts for this kind of situation What situation, being trapped? I'm not sure what size has to do with it. Are small corporations maybe more ... agile?
- OJFord 5y agoIt's very impactful though, it'll probably be people seeing it as highly visible and career-advancing who manage to muster the 'patience and leverage'. If the org's been thoughtful to in advance, it's at the level of being almost an operational risk - all of engineering uses this tool, tool's licence or pricing might change, retooling has an associated cost and down-time.
- ithkuil 5y agoYou can drill through layers of that crap if you can sell something through aws marketplace or equivalent thing that your company is already set up to spend millions a month. Not sure how would that work for a desktop tool. It's in them to figure that out though
- staticassertion 5y agoI really doubt that procurement is going to be harder than switching a technology out.
- JanisL 5y agoEntirely depends on the organization, I used to think this too but then I encountered some organizations (granted ones with entirely dysfunctional procurement processes) where switching technologies was easier and less risky to schedules than going down the procurement process. The risk of missing deadlines and blowing out schedules is the factor that tends to be on people's minds when procurement is brutally slow.
- wintermutestwin 5y agoOpEx is much easier to get vs CapX. That's why so many things are subscription now. (also Sarbaines Oxley pushed vendors into subscription models)
- rwallace 5y agoNow I'm curious: Sarbanes-Oxley pushed vendors into subscription models? How? What exactly did it change in the cost-benefit picture?
- wintermutestwin 5y agoS/O changed the way that revenue was recognized when a vendor sold product and services to implement. Basically, you had to wait until the implementation services were completed to recognize product revenue. Time to complete services could be multi-year and customer dependent.
- orthoxerox 5y ago> OpEx is much easier to get vs CapX Not where I work at. IT opex are a recurring cost item with no visible benefits, so are squeezed dry at every annual budget review. Capex are seen as investments into something new and good and their impact on the bottom line is amortized over several years.
- mc32 5y agoSometimes you can put these things on CC rather than P.O.
- argomo 5y agoHeh heh... so true it hurts. Why spend 3 years pushing it past risks reviews and oversight committees when you could just write a crappy version that does what you need? Legal alone will spend months looking at run-of-the-mill software contacts trying to negotiate absurd concessions from vendors in situations where they clearly have no bargaining power. We can spend a lot of money on Oracle for their profoundly obtuse products though.
- kayodelycaon 5y ago> trying to negotiate absurd concessions from vendors in situations where they clearly have no bargaining power I got front-line seats at a company with tens of millions in revenue try to get payment processor to remove escrow terms from the contract. Said company got blocked at tier 2 support. They refused to escalate for a company who wasn’t a customer, especially when legal stuff was involved. Tier 2 had a script specifically for people like us. I regret not bringing popcorn to that phone call. In short: “Those aren’t our terms; those are the terms of a billion-dollar bank. Sign it or leave.” They were very much not impressed with our claim to being the second-largest widget maker in the world.
- racecar789 5y agoEasier method to deal with monthly payment...Create a purchase order with 12 lines. One line for each month with dollar amounts defined. The purchase order serves as the "approval" so Accounts Payable can process without asking for coding information. Example: I only have to revisit licensing once a year, to create a new 12 line purchase order. It's still a pain but I prefer purchase orders vs dealing with credit cards. In addition, querying expense history for purchase order lines provides far more detail vs querying a credit card platform. Credit card history tends to go into a black hole. One possible hitch...Some companies might restrict Accounts Payable from receiving purchase orders for separation-of-duties reasons.
- malux85 5y agoYep, I’ve been there, I was a consultant in London charging 700 pounds a day, and my hands were tied because of a silly 50 USD license expense and couldn’t work for a month. I asked if I could just pay it myself, but was told that would violate the IT department guidelines and possibly an SLA too, so I just sat there for a month, reminding everyone at the daily stand ups I was blocked. I couldn’t believe it. I was not the only one who was tied in red tape there, it was indeed normal. This company was making 600 million a year in profit.