4 ms·

Do we have any evidence that the over-hiring was a mistake? Could companies not have seen the free money and decided to beef up their staff for short term gain

by broast 4y ago

Do we have any evidence that the over-hiring was a mistake? Could companies not have seen the free money and decided to beef up their staff for short term gains in their roadmap, with the knowledge and intention that they will likely be cutting later while getting to keep all that intellectual output? I don't see why we put this past them.

wpietri 4y ago
Another question I'd ask is: why can't the find something useful to do with these people in the meantime? Downturns are definitionally temporary. Can managers really find no way to prepare for the coming good times? Or is there no way to use those staff to gain ground while everybody else is retreating? Workers are getting blamed by many for (claimed) low productivity. But why isn't that seen as a managerial failure? Isn't it better to have the same number of people and use them much better than a smaller number of people that are just as poorly used?
- s1artibartfast 4y ago
  >Isn't it better to have the same number of people and use them much better than a smaller number of people that are just as poorly used? Of course! But that is much easier said than done. If it was as simple as just telling managers find a use that will make money, everyone would do that instead.
  - wpietri 4y ago
    Alas, probably not. A great example here is the NUMMI plant. In brief, Totota was kicking the collective asses of US carmakers. The techniques were not a trade secret; indeed, Toyota was happy to teach anybody. As part of that, they did a joint venture with GM called NUMMI, so they could show how they implemented core principles like "respect for people" and "continuous improvement". And it worked! Using the same building and most of the same people, it went from being one of the worst GM plants to one of the best. Did GM learn anything? Hell no. Because GM executives valued other things more than productivity and quality and worker happiness. For the curious, this American Life did a great radio story about it: https://www.thisamericanlife.org/561/nummi-2015 https://www.thisamericanlife.org/561/nummi-2015
    - Tempest1981 4y ago
      Thanks for the recommendation. This GM/automotive documentary was also interesting: "American Factory" https://www.imdb.com/title/tt9351980/ https://www.imdb.com/title/tt9351980/ (Don't be put off by the dramatized trailer)
      - s1artibartfast 4y ago
        Good movie but very different take away message, at least for me
- grok22 4y ago
  I think managers will do that (keep popel around just in case), but businessmen (or CEO's) will optimize for what's best for the business. No? A lower-level manager who actually sees the nitty-gritty of getting something done will not really have as much of a say in the broader business.
  - rightbyte 4y ago
    > businessmen (or CEO's) will optimize for what's best for the business. No? Really? I feel most optimize for their short term bonuses. Which makes them take too great risks since they won't owe the shareholders anything if they fail. Like all these overhiring sprees.
    - grok22 4y ago
      Yeah, CEO's likely optimize for their bonuses...depressing to think about it; but most likely the CEO's compensation is aligned to what the company wants to be the outcome financially.
danielrhodes 4y ago
Tech work is now seasonal you say?
- dehrmann 4y ago
  Cyclical != seasonal
tekdude 4y ago
Anecdotally, I've heard multiple stories of companies hiring staff, but not having any useful work to fill their time. Cases like product managers being hired but not assigned to any actual products, or engineers hired to infrastructure teams before the company has decided what infrastructure it wants. Although, these anecdotes are mostly from startups trying to scale and grow, not from FAANG-tier companies.
- whstl 4y ago
  I have been in one such companies. The investors asked for larger headcount, and the company complied. With the pandemic, there were some layoffs, and then big chunk of engineering left out of their own volition, since there wasn't nearly enough work for 450 engineers to do that wasn't accomplished with 100 a couple years before.
lapcat 4y ago
> while getting to keep all that intellectual output Intellectual output or technical debt?
grok22 4y ago
Interesting way to look at it. It certainly makes sense that companies hire to capture intellectual output when money is cheap and then tighten spending when access to easy money goes away even if they are making money hand-over-fist in their business.
- brandall10 4y ago
  I think by and large it comes down to appeasing shareholders. If there is a chance that predicted quarterly metrics are impacted, this type bloodletting acts as a hedge. The whole "we understand we're not where we said we'd be at and as a result we're cutting costs". The issue of course is this is short-sighted thinking.
  - untilNxtwk 4y ago
    Yeh. The entire org has to rethink what progress means with such cuts and that takes time, which impacts deadlines. We’re far too controlled by the short term anxiety of investors. Financiers need to learn more about how the physical world works and not just fetishize abstract math conveniently labeled in politically correct tradition. The burden should be on finance to prove its value and not be allowed to leverage recent history when the market could only go up as the post-WW2 world was a crater. Other countries have caught up and don’t have to play by the US’s old rules. Why should the next generation within the US? People who lucked into winning have an extraordinary burden of proof their success wasn’t just being born in a time-place.
- untilNxtwk 4y ago
  It certainly challenges the genius tech CEO story when they’re all just copy-pasting each other. None of the software CEOs are charting a net new course for tech manufacture; they’re just managing data center footprint that host vapid content. The older crowd is aging away and the younger crowd that grew up with a Gameboy in their face, not WSJ, can start making their own content with ML (like I am). The emotional temple that is social media is not interesting to the next generation as they know how to Docker pull Twitter and the like into existence. It’s a solved problem from an engineering perspective. We’re bored serving politically correct capitalist memes.

by broast 4y ago

wpietri 4y ago

Another question I'd ask is: why can't the find something useful to do with these people in the meantime? Downturns are definitionally temporary. Can managers really find no way to prepare for the coming good times? Or is there no way to use those staff to gain ground while everybody else is retreating? Workers are getting blamed by many for (claimed) low productivity. But why isn't that seen as a managerial failure? Isn't it better to have the same number of people and use them much better than a smaller number of people that are just as poorly used?

s1artibartfast 4y ago
>Isn't it better to have the same number of people and use them much better than a smaller number of people that are just as poorly used? Of course! But that is much easier said than done. If it was as simple as just telling managers find a use that will make money, everyone would do that instead.
- wpietri 4y ago
  Alas, probably not. A great example here is the NUMMI plant. In brief, Totota was kicking the collective asses of US carmakers. The techniques were not a trade secret; indeed, Toyota was happy to teach anybody. As part of that, they did a joint venture with GM called NUMMI, so they could show how they implemented core principles like "respect for people" and "continuous improvement". And it worked! Using the same building and most of the same people, it went from being one of the worst GM plants to one of the best. Did GM learn anything? Hell no. Because GM executives valued other things more than productivity and quality and worker happiness. For the curious, this American Life did a great radio story about it: https://www.thisamericanlife.org/561/nummi-2015 https://www.thisamericanlife.org/561/nummi-2015
  - Tempest1981 4y ago
    Thanks for the recommendation. This GM/automotive documentary was also interesting: "American Factory" https://www.imdb.com/title/tt9351980/ https://www.imdb.com/title/tt9351980/ (Don't be put off by the dramatized trailer)
    - s1artibartfast 4y ago
      Good movie but very different take away message, at least for me
grok22 4y ago
I think managers will do that (keep popel around just in case), but businessmen (or CEO's) will optimize for what's best for the business. No? A lower-level manager who actually sees the nitty-gritty of getting something done will not really have as much of a say in the broader business.
- rightbyte 4y ago
  > businessmen (or CEO's) will optimize for what's best for the business. No? Really? I feel most optimize for their short term bonuses. Which makes them take too great risks since they won't owe the shareholders anything if they fail. Like all these overhiring sprees.
  - grok22 4y ago
    Yeah, CEO's likely optimize for their bonuses...depressing to think about it; but most likely the CEO's compensation is aligned to what the company wants to be the outcome financially.

danielrhodes 4y ago

Tech work is now seasonal you say?

dehrmann 4y ago
Cyclical != seasonal

tekdude 4y ago

Anecdotally, I've heard multiple stories of companies hiring staff, but not having any useful work to fill their time. Cases like product managers being hired but not assigned to any actual products, or engineers hired to infrastructure teams before the company has decided what infrastructure it wants. Although, these anecdotes are mostly from startups trying to scale and grow, not from FAANG-tier companies.

whstl 4y ago
I have been in one such companies. The investors asked for larger headcount, and the company complied. With the pandemic, there were some layoffs, and then big chunk of engineering left out of their own volition, since there wasn't nearly enough work for 450 engineers to do that wasn't accomplished with 100 a couple years before.

lapcat 4y ago

> while getting to keep all that intellectual output Intellectual output or technical debt?

grok22 4y ago

Interesting way to look at it. It certainly makes sense that companies hire to capture intellectual output when money is cheap and then tighten spending when access to easy money goes away even if they are making money hand-over-fist in their business.

brandall10 4y ago
I think by and large it comes down to appeasing shareholders. If there is a chance that predicted quarterly metrics are impacted, this type bloodletting acts as a hedge. The whole "we understand we're not where we said we'd be at and as a result we're cutting costs". The issue of course is this is short-sighted thinking.
- untilNxtwk 4y ago
  Yeh. The entire org has to rethink what progress means with such cuts and that takes time, which impacts deadlines. We’re far too controlled by the short term anxiety of investors. Financiers need to learn more about how the physical world works and not just fetishize abstract math conveniently labeled in politically correct tradition. The burden should be on finance to prove its value and not be allowed to leverage recent history when the market could only go up as the post-WW2 world was a crater. Other countries have caught up and don’t have to play by the US’s old rules. Why should the next generation within the US? People who lucked into winning have an extraordinary burden of proof their success wasn’t just being born in a time-place.
untilNxtwk 4y ago
It certainly challenges the genius tech CEO story when they’re all just copy-pasting each other. None of the software CEOs are charting a net new course for tech manufacture; they’re just managing data center footprint that host vapid content. The older crowd is aging away and the younger crowd that grew up with a Gameboy in their face, not WSJ, can start making their own content with ML (like I am). The emotional temple that is social media is not interesting to the next generation as they know how to Docker pull Twitter and the like into existence. It’s a solved problem from an engineering perspective. We’re bored serving politically correct capitalist memes.