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> profits aren't the true goal... Ok, we can all stop there and go home. This person knows more than every economist and game-theorist on the planet. >They're

> profits aren't the true goal... Ok, we can all stop there and go home. This person knows more than every economist and game-theorist on the planet. >They're all kinda the same, though, and the system is designed that way. I take it you haven't had many jobs I've worked at 5 different corporations and this is just verifiably wrong. 'The system' you're referencing is voluntary exchange, and it's not designed, it emerges from the concept of private property.

ltfey 5y ago
verve_rat 5y ago
Profit for the firm might be the goal for the firm as an entity, such that it is, but the goal for each individual is their own self interest. The worker wants a pay rise, the manager wants a promotion, the CEO wants a better gig at the next company. None of that is a goal of making more money for the company.
- pc86 5y ago
  The number one way for the CEO to get a better gig at the next company is to make the company they're at now wildly successful. The number one way for a VP to get a promotion to the C suite is to make the CEO look good. Etc. etc. down the line to the ICs.
- BobbyJo 5y ago
  But it is all 'profit'. Prestige is an asset some people pursue, money another. The challenge of corporate governance is designing it so that the incentives for the individuals within it align with the goals of the corporation itself. Every "How to do startups" book written has some portion of it dedicated to "How to get your employees' wants to align with the company's." This is the primary difference between companies that thrive over long periods and those that die out quickly. There are academic textbooks written on the subject. Its study is as old as the corporate structure itself.
- adamsmith143 5y ago
  >The worker wants a pay rise, the manager wants a promotion, the CEO wants a better gig at the next company. None of that is a goal of making more money for the company. This is quite literally the definition of Adam Smith's Invisible Hand. "By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it."
Retric 5y ago
> every economist This is well known in economics, perverse incentives is one example used to describe this kind of discrepancy. Help desk people hanging up on what is expected to be very long calls when average call length is considered a critical metric.
- BobbyJo 5y ago
  Perverse incentives exist. 100%. However, they are studied as a failure in the system, something to fix. They are not designed or intentionally created as part of the system as the parent comment posits.
  - Retric 5y ago
    I don’t agree with his comment and sure in a theoretical round cow in a vacuumed sort of way sure workers and managers incentives should align with company profits. My point was economists spend a lot of time investigating the mismatch because no company gets this completely correct.
    - BobbyJo 5y ago
      Sure, and no line is completely straight, but that doesn't mean your floors aren't level enough to live on.

ltfey 5y ago

verve_rat 5y ago

Profit for the firm might be the goal for the firm as an entity, such that it is, but the goal for each individual is their own self interest. The worker wants a pay rise, the manager wants a promotion, the CEO wants a better gig at the next company. None of that is a goal of making more money for the company.

pc86 5y ago
The number one way for the CEO to get a better gig at the next company is to make the company they're at now wildly successful. The number one way for a VP to get a promotion to the C suite is to make the CEO look good. Etc. etc. down the line to the ICs.
BobbyJo 5y ago
But it is all 'profit'. Prestige is an asset some people pursue, money another. The challenge of corporate governance is designing it so that the incentives for the individuals within it align with the goals of the corporation itself. Every "How to do startups" book written has some portion of it dedicated to "How to get your employees' wants to align with the company's." This is the primary difference between companies that thrive over long periods and those that die out quickly. There are academic textbooks written on the subject. Its study is as old as the corporate structure itself.
adamsmith143 5y ago
>The worker wants a pay rise, the manager wants a promotion, the CEO wants a better gig at the next company. None of that is a goal of making more money for the company. This is quite literally the definition of Adam Smith's Invisible Hand. "By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it."

Retric 5y ago

> every economist This is well known in economics, perverse incentives is one example used to describe this kind of discrepancy. Help desk people hanging up on what is expected to be very long calls when average call length is considered a critical metric.

BobbyJo 5y ago
Perverse incentives exist. 100%. However, they are studied as a failure in the system, something to fix. They are not designed or intentionally created as part of the system as the parent comment posits.
- Retric 5y ago
  I don’t agree with his comment and sure in a theoretical round cow in a vacuumed sort of way sure workers and managers incentives should align with company profits. My point was economists spend a lot of time investigating the mismatch because no company gets this completely correct.
  - BobbyJo 5y ago
    Sure, and no line is completely straight, but that doesn't mean your floors aren't level enough to live on.