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Hmm. Rather than spend $180 or $300 million to purchase tech companies, maybe some of these stores could try paying Silicon Valley salaries to a team of 10 or

Hmm. Rather than spend $180 or $300 million to purchase tech companies, maybe some of these stores could try paying Silicon Valley salaries to a team of 10 or 20 devs. 20 devs * $200 K (loaded) / year = $4 M / year. ... Assuming they had a way to bootstrap an idiot-rejection-filter.

bgentry 15y ago
That's a much better plan. It's funny that they are unwilling to pay above-market salaries to a few competent devs.
- fleitz 15y ago
  Big box retail is currently built on an interchangeable parts model. Retailers keep costs down by making people replaceable, unfortunately at this point that model doesn't work well for tech. It's unlikely that this will change as that mindset is built into the culture of the organization and has done well for the industry in the last 30 years. It's likely that retail will undergo another change such as when sears took over in the late 19th / early 20th century. Retailers arent going to lose the war they will simply be replaced by more nimble competitors who can properly leverage technology. Contrary to popular belief there are good developers outside of sv and some developers are motivated towards well paying 9 to 5 jobs instead of options and sodas. The article also conveniently ignores the huge logistics infrastructure retailers have and focuses purely on websites, while the web is certainly important the reality of the situation is that currently retailers such as Walmart have huge competitive advantages due to its investment in logistics tech and infrastructure.
  - kls 15y ago
    It's unlikely that this will change as that mindset is built into the culture of the organization and has done well for the industry in the last 30 years. It will change if organizations like Amazon and Zappos prove out that it is a competitive advantage. It is just mainstream retail is not the proving grounds for such revelations.
- ajross 15y ago
  It's a terrible plan. Paying a bunch of rock star salaries just gets you a bunch of people that say they are rock stars. If you don't have any on staff, you don't actually know if they are or not (pg has an essay about exactly this). History is filled with these kind of rock star failures. Buying the company gets you a team that can verifiably build the product you want, because they already did. That kind of conservative risk management is worth a ton of cash in the real world.
  - ams6110 15y ago
    Well GP did say "Assuming they had a way to bootstrap an idiot-rejection-filter" Though why would it not be possible to hire a person with a track record of building the sorts of things you want, and let that person hire the team? Buying a company may or may not get you a team, depending on whether or not they stick around.
    - kls 15y ago
      I am getting ready to put together an article on this subject, it is actually pretty easy to identify a key developer and recruit them, it is just that most companies hiring practices are the antithesis to identifying that developer.
  - droithomme 15y ago
    $200k isn't a rock star salary. You are correct that paying market salaries for competent engineers does not ensure competent engineers. However it must be noted that not paying market salaries for competent engineers definitely ensures that one employes substandard talent. The market is working well right now and competent engineers have no problem receiving market rate. There is absolutely no reason whatsoever why competent engineers will not find a job paying the market rate for their talent, and that is exactly what happens. As for the companies that can not pay market rate, well they are simply not competitive and will fail. That's how the free market works and it is a very good thing. Any company that requires being competitive in the tech domain needs to be willing to pay for key talent. Companies like Target definitely need to do everything they can. Arguments that incompetent developers are good enough are absurd. Obviously what they have now is not working. Building a site that can handle a nationwide retailer the size of Target, second only to WalMart in brick and mortar stores, is completely non-trivial. The top 2 engineers there need to be paid at least $1.5 million annual salary. Sorry. I know many companies don't like this but there it is. Now obviously there are many levels below this, but this requires a pretty large development team and several below this level are going to be getting $200k-$400k. At the bottom, the losers that are just out of college and don't know anything, those guys are going to be making $75k to start. Because that's the starting salary. Companies don't want to hear this. Only the fatuous useless ignorant executives that have run the company into the ground should be paid these salaries, in their opinion. Well, they can keep thinking that and see where it gets them. Many will lobby Congress, that is a popular tactic. Pay a lobbying firm $25 million and maybe you'll be able to flood the market with cheap engineers from overseas who are willing to work for $21 an hour, and are able to do the same things that any other $21 an hour retail employee can do. Because the overseas guys that really know their stuff are not looking for $21 jobs, they are making the same salary as everyone else with their skill level. Because that's how the market works.
buff-a 15y ago
LOL. 200k? 20 devs? To build store.target.com? They'd better be awesome, and that awesome doesn't walk for 200K. That level of awesome builds the product (show don't tell) and then sells it for $180m.
- Roboprog 15y ago
  How many developers should it take to build an ecommerce site??? Sys-admins + DBAs + "biz logic" devs + "front end" devs and a few artist, project mgr types and entry level supporting developers??? Given a sufficiently inefficient process, an infinite amount of labor can be absorbed, I suppose. I would think a core tiger team could accomplish wonders simply iteratively triaging their existing operations.
  - projectileboy 15y ago
    Consultant for a big box retailer here. Yes, of course I can build a shopping cart site with a few good hackers, and I can find a few good hackers anywhere. But that's not what I have. I have a pile of legacy crud that has to integrate with ten other piles of legacy crud, not to mention the external crud with which I must integrate. And did I mention that during holiday the site gets a little more traffic than most sites? Or that the site makes a few hundred million dollars, and can't just be rewritten on a whim? To solve these sorts of problems, I don't need ten good hackers, I need more like 50. Or more. And that's the challenge the article is talking about. Because good hackers have options like Facebook - or their own startups - where they don't have to deal with that kind of noise. It's a serious challenge for any big company which relies heavily on the web, which in 2012 is every big company.
    - HalibetLector 15y ago
      "Or that the site makes a few hundred million dollars, and can't just be rewritten on a whim?" Why not? If the site is unstable and can't stay up, you can either throw 50 programmers at it and still have it crash regularly or you can take far fewer and re-write it from scratch. You're right about programmers not liking the cruft, but we also don't like most of the management processes that occur in large companies. I don't know if things have changed, but back when I worked for a large brake corporation, web programmers were devalued and distrusted. All of our decisions had to be signed off (in triplicate!) by a manager who didn't know how to program or the implications of the decisions being made. To give you on example, one of the official company-wide policies was that if you wanted to transfer files between company offices over the internet, you had to use FTP for "security purposes." We were technically not allowed to use SSH or SFTP because, when I asked, my boss said nobody had heard of it. This was in 2006.
officialchicken 15y ago
Or maybe offer a percentage of the online sales revenue, after returns (and avoiding hollywood math). I've interviewed with several "luxury" retailers within the past year, and my idiot-rejection-filter was usually triggered soon after the beginning of the interview. It was usually due to the perception of inmates running asylum, or a legacy technology I didn't want anywhere near my resume (VB). Either way, lack of technological leadership, planning, and execution was easy to spot with a phone call or visit to a store.

bgentry 15y ago

That's a much better plan. It's funny that they are unwilling to pay above-market salaries to a few competent devs.

fleitz 15y ago
Big box retail is currently built on an interchangeable parts model. Retailers keep costs down by making people replaceable, unfortunately at this point that model doesn't work well for tech. It's unlikely that this will change as that mindset is built into the culture of the organization and has done well for the industry in the last 30 years. It's likely that retail will undergo another change such as when sears took over in the late 19th / early 20th century. Retailers arent going to lose the war they will simply be replaced by more nimble competitors who can properly leverage technology. Contrary to popular belief there are good developers outside of sv and some developers are motivated towards well paying 9 to 5 jobs instead of options and sodas. The article also conveniently ignores the huge logistics infrastructure retailers have and focuses purely on websites, while the web is certainly important the reality of the situation is that currently retailers such as Walmart have huge competitive advantages due to its investment in logistics tech and infrastructure.
- kls 15y ago
  It's unlikely that this will change as that mindset is built into the culture of the organization and has done well for the industry in the last 30 years. It will change if organizations like Amazon and Zappos prove out that it is a competitive advantage. It is just mainstream retail is not the proving grounds for such revelations.
ajross 15y ago
It's a terrible plan. Paying a bunch of rock star salaries just gets you a bunch of people that say they are rock stars. If you don't have any on staff, you don't actually know if they are or not (pg has an essay about exactly this). History is filled with these kind of rock star failures. Buying the company gets you a team that can verifiably build the product you want, because they already did. That kind of conservative risk management is worth a ton of cash in the real world.
- ams6110 15y ago
  Well GP did say "Assuming they had a way to bootstrap an idiot-rejection-filter" Though why would it not be possible to hire a person with a track record of building the sorts of things you want, and let that person hire the team? Buying a company may or may not get you a team, depending on whether or not they stick around.
  - kls 15y ago
    I am getting ready to put together an article on this subject, it is actually pretty easy to identify a key developer and recruit them, it is just that most companies hiring practices are the antithesis to identifying that developer.
- droithomme 15y ago
  $200k isn't a rock star salary. You are correct that paying market salaries for competent engineers does not ensure competent engineers. However it must be noted that not paying market salaries for competent engineers definitely ensures that one employes substandard talent. The market is working well right now and competent engineers have no problem receiving market rate. There is absolutely no reason whatsoever why competent engineers will not find a job paying the market rate for their talent, and that is exactly what happens. As for the companies that can not pay market rate, well they are simply not competitive and will fail. That's how the free market works and it is a very good thing. Any company that requires being competitive in the tech domain needs to be willing to pay for key talent. Companies like Target definitely need to do everything they can. Arguments that incompetent developers are good enough are absurd. Obviously what they have now is not working. Building a site that can handle a nationwide retailer the size of Target, second only to WalMart in brick and mortar stores, is completely non-trivial. The top 2 engineers there need to be paid at least $1.5 million annual salary. Sorry. I know many companies don't like this but there it is. Now obviously there are many levels below this, but this requires a pretty large development team and several below this level are going to be getting $200k-$400k. At the bottom, the losers that are just out of college and don't know anything, those guys are going to be making $75k to start. Because that's the starting salary. Companies don't want to hear this. Only the fatuous useless ignorant executives that have run the company into the ground should be paid these salaries, in their opinion. Well, they can keep thinking that and see where it gets them. Many will lobby Congress, that is a popular tactic. Pay a lobbying firm $25 million and maybe you'll be able to flood the market with cheap engineers from overseas who are willing to work for $21 an hour, and are able to do the same things that any other $21 an hour retail employee can do. Because the overseas guys that really know their stuff are not looking for $21 jobs, they are making the same salary as everyone else with their skill level. Because that's how the market works.

buff-a 15y ago

LOL. 200k? 20 devs? To build store.target.com? They'd better be awesome, and that awesome doesn't walk for 200K. That level of awesome builds the product (show don't tell) and then sells it for $180m.

Roboprog 15y ago
How many developers should it take to build an ecommerce site??? Sys-admins + DBAs + "biz logic" devs + "front end" devs and a few artist, project mgr types and entry level supporting developers??? Given a sufficiently inefficient process, an infinite amount of labor can be absorbed, I suppose. I would think a core tiger team could accomplish wonders simply iteratively triaging their existing operations.
- projectileboy 15y ago
  Consultant for a big box retailer here. Yes, of course I can build a shopping cart site with a few good hackers, and I can find a few good hackers anywhere. But that's not what I have. I have a pile of legacy crud that has to integrate with ten other piles of legacy crud, not to mention the external crud with which I must integrate. And did I mention that during holiday the site gets a little more traffic than most sites? Or that the site makes a few hundred million dollars, and can't just be rewritten on a whim? To solve these sorts of problems, I don't need ten good hackers, I need more like 50. Or more. And that's the challenge the article is talking about. Because good hackers have options like Facebook - or their own startups - where they don't have to deal with that kind of noise. It's a serious challenge for any big company which relies heavily on the web, which in 2012 is every big company.
  - HalibetLector 15y ago
    "Or that the site makes a few hundred million dollars, and can't just be rewritten on a whim?" Why not? If the site is unstable and can't stay up, you can either throw 50 programmers at it and still have it crash regularly or you can take far fewer and re-write it from scratch. You're right about programmers not liking the cruft, but we also don't like most of the management processes that occur in large companies. I don't know if things have changed, but back when I worked for a large brake corporation, web programmers were devalued and distrusted. All of our decisions had to be signed off (in triplicate!) by a manager who didn't know how to program or the implications of the decisions being made. To give you on example, one of the official company-wide policies was that if you wanted to transfer files between company offices over the internet, you had to use FTP for "security purposes." We were technically not allowed to use SSH or SFTP because, when I asked, my boss said nobody had heard of it. This was in 2006.

officialchicken 15y ago

Or maybe offer a percentage of the online sales revenue, after returns (and avoiding hollywood math). I've interviewed with several "luxury" retailers within the past year, and my idiot-rejection-filter was usually triggered soon after the beginning of the interview. It was usually due to the perception of inmates running asylum, or a legacy technology I didn't want anywhere near my resume (VB). Either way, lack of technological leadership, planning, and execution was easy to spot with a phone call or visit to a store.