4 ms·

To me the strategy has seemed so backwards the last few years. You are the CEO of a giant tech company, and your goal is to achieve maximum well-being of the c

To me the strategy has seemed so backwards the last few years. You are the CEO of a giant tech company, and your goal is to achieve maximum well-being of the company in, say, 3 years time. You are confident you can weather the short term ups and downs. You could: 1. Follow trends. Go on a hiring frenzy at the same time as everyone else. You have to compete with absurd compensation packages because everybody already has a job or is getting multiple offers. 2. Buck the trend. Hire when others are in the middle of layoffs. Show strength when others are making their sheepish apologies. Pay discounted labour prices for top talent. To me choice #2 is a no-brainer but obviously nobody will ever put me in a position to decide, and it's easy to be an arm-chair CEO. Is it really that these companies are so short-sighted, and are more worried about next quarter than next year? Could nobody see the interest rate hikes coming? I just can't imagine how executives/boards would overlook the impact on stock price if a company was publicly known to use foresight in their hiring practices. What if the headline was something like "Google hiring continues at same rate during recession," doesn't that send a strong signal to investors?

yafbum 4y ago
You can't necessarily survive #2 if it causes the talent you actually need the most to bail in high times. You can play this game at the margin by starting to freeze hiring before everyone else does, so that you can be there earlier to hire again at discounted rates in the downturn
obviouslynotme 4y ago
Management doesn't like scaring their workers and wait for recessions to fire low performers all at once. Hiring someone else's scraps isn't the best strategy, and digging for the diamonds in the dirt is very expensive.
- quanticle 4y ago
  Management doesn't like scaring their workers and wait for recessions to fire low performers all at once. Hiring someone else's scraps isn't the best strategy, and digging for the diamonds in the dirt is very expensive. Can we please dispense with this notion that layoffs target "low performers"? There is zero evidence across any of the current round of layoffs that low performers were systematically targeted. There was zero evidence of this in 2008. There was zero evidence of this in 2001. Mass layoffs hit in a number of ways and "performance" is just one of the criteria used to determine who gets the axe. It might not even be the primary one --- there are plenty of stories, even in this specific layoff, of people who were just promoted and are now being let go. From the perspective of the individual worker, it's far better to model layoffs as a random lottery. Telling yourself, "Oh, I'll work hard, I'll get good performance reviews, that'll save me from the layoff monster," is just cope. Good people get laid off. Bad people get laid off. Mediocre people get laid off. It's just luck.
startupsfail 4y ago
[flagged]
vasco 4y ago
> and your goal is to achieve maximum well-being of the company in, say, 3 years time Your fiduciary duty is to maximize shareholder profit. Not sure where you got the "well-being" from, but your premise is utterly wrong so your presented choices and how you deal with them are not connected to reality.
- makomk 4y ago
  There is no fiducary duty to maximise shareholder profit. It doesn't exist, it's basically made up. (There is a duty not to intentionally screw over shareholders, but that's far narrower.) In particular, most US corporations are incorporated in Delaware which has something called the business judgement rule, where so long as executives have reasonable belief that their actions are in the best interests of the business they're protected.
- gilbetron 4y ago
  > fiduciary duty is to maximize shareholder profit This keeps coming up and is kind of true, but not really. To quote the U.S. Supreme Court opinion in the Hobby Lobby case: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.” https://caselaw.findlaw.com/us-supreme-court/13-354.html https://caselaw.findlaw.com/us-supreme-court/13-354.html

yafbum 4y ago

You can't necessarily survive #2 if it causes the talent you actually need the most to bail in high times. You can play this game at the margin by starting to freeze hiring before everyone else does, so that you can be there earlier to hire again at discounted rates in the downturn

obviouslynotme 4y ago

Management doesn't like scaring their workers and wait for recessions to fire low performers all at once. Hiring someone else's scraps isn't the best strategy, and digging for the diamonds in the dirt is very expensive.

quanticle 4y ago
Management doesn't like scaring their workers and wait for recessions to fire low performers all at once. Hiring someone else's scraps isn't the best strategy, and digging for the diamonds in the dirt is very expensive. Can we please dispense with this notion that layoffs target "low performers"? There is zero evidence across any of the current round of layoffs that low performers were systematically targeted. There was zero evidence of this in 2008. There was zero evidence of this in 2001. Mass layoffs hit in a number of ways and "performance" is just one of the criteria used to determine who gets the axe. It might not even be the primary one --- there are plenty of stories, even in this specific layoff, of people who were just promoted and are now being let go. From the perspective of the individual worker, it's far better to model layoffs as a random lottery. Telling yourself, "Oh, I'll work hard, I'll get good performance reviews, that'll save me from the layoff monster," is just cope. Good people get laid off. Bad people get laid off. Mediocre people get laid off. It's just luck.

startupsfail 4y ago

[flagged]

vasco 4y ago

> and your goal is to achieve maximum well-being of the company in, say, 3 years time Your fiduciary duty is to maximize shareholder profit. Not sure where you got the "well-being" from, but your premise is utterly wrong so your presented choices and how you deal with them are not connected to reality.

makomk 4y ago
There is no fiducary duty to maximise shareholder profit. It doesn't exist, it's basically made up. (There is a duty not to intentionally screw over shareholders, but that's far narrower.) In particular, most US corporations are incorporated in Delaware which has something called the business judgement rule, where so long as executives have reasonable belief that their actions are in the best interests of the business they're protected.
gilbetron 4y ago
> fiduciary duty is to maximize shareholder profit This keeps coming up and is kind of true, but not really. To quote the U.S. Supreme Court opinion in the Hobby Lobby case: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.” https://caselaw.findlaw.com/us-supreme-court/13-354.html https://caselaw.findlaw.com/us-supreme-court/13-354.html