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Maybe this operating model is why they haven’t had to have layoffs and can weather the storm. In Japan, people value job security over maximizing expected valu

Maybe this operating model is why they haven’t had to have layoffs and can weather the storm. In Japan, people value job security over maximizing expected value of compensation.

kevviiinn 4y ago
The storm of wanting to keep their obscenely large profits at the same scale? I mean, that's what the other big tech companies who are laying off employees are doing
kurikuri 4y ago
>In Japan, people value job security over maximizing expected value of compensation. I don’t think that is it. In Japan, the way of maximizing compensation is by staying in your job as long as possible, because the pay is strongly tied to seniority.
- alwayslikethis 4y ago
  On the whole, this is a rather more "equal" process. The top managers don't get paid the huge amounts they do in the US. However this also leads to all the unproductive situations you can imagine, with seniors running the company into the ground and the juniors not being able to do anything about it.
  - papito 4y ago
    It always fascinates me how Japan is full of anachronistic, counter-productive traditions and is also one of the most advanced countries in the world at the same time. The whole place is full of contradictions. If everyone works absolutely insane hours and has no life, one would imagine the life expectancy would be shot as well, just due to the stress. Someone explain this to me.
    - bobthepanda 4y ago
      Japan was one of the most advanced countries in the world. The country has been stagnating for quite a while. South Korea and Taiwan have since eclipsed it by PPP-adjusted metrics per person. (Japanese make higher paper incomes than South Koreans and Taiwanese, but they also generally pay more for imports due to tariffs.)
    - robertlagrant 4y ago
      My off the cuff theory is perhaps their diet is very good, so offsets some of the shortened life expectancy from stress? On the graph of stress vs diet, where being in the top right is the worst for life expectancy, being high on only one might help. Having said that, I don't know if the average Japanese diet is good. Just postulating a possibility.
      - alwayslikethis 4y ago
        On the whole it is probably better than US, but it's not like they don't have unhealthy habits either. Smoking is far more common than in most Western countries. Drinking I'm not so sure, but they do have the custom of forced work drinking parties, and most Asians have the gene that produce extra toxins from alcohol, so the harm from drinking must not be negligible. I would posit that the life expectancy is in part due to lack of documentation of dying. There are many cases in Tokyo where old people living alone are found dead only weeks later when neighbors complained about the smell.
    - deleted 4y ago
      [deleted]
lph 4y ago
Most of the tech companies having layoffs don't "have to" have layoffs. They're doing it to depress worker compensation across the whole sector. It's a shameless money grab at the expense of their employees.
- Godel_unicode 4y ago
  That’s an interesting theory, how do you reconcile it with the fact that several companies which have had layoffs have also given out large stock refreshes to some of the employees who weren’t laid off?
  - jonathankoren 4y ago
    Easy. You said it yourself. “Some”.
- 542458 4y ago
  This doesn’t really make sense to me from a game theory POV. As a company, laying off productive employees of my own has an insignificant impact on the total sector’s compensation, but reduces my output and therefore profitability. Why would I do it? If I think there’s some big sector-wide conspiracy to unnecessarily cause layoffs to depress wages, my dominant strategy is to not participate - I still gain the full benefits (since my own participation has only a trivial impact on the outcome), but without hurting my own output.
  - P_I_Staker 4y ago
    If you're Amazon it would... this wouldn't be the first time companies colluded to suppress wages in SV. It might not even be explicit collusion. These companies do have other motivations for these changes.
  - brianwawok 4y ago
    I don’t think dropping the lowest 10% of developers is hurting your output. It might even raise it.
dchftcs 4y ago
It seems Nintendo profits were 4B+ last year. It has ~7000 employees, working out to 500k+ per head in profit (not revenue). I can't readily find compensation data but given the low pay in Japan I'd be surprised if the average annual compensation is substantially higher than 100k. They definitely have a lot of room to increase pay despite whatever risk you mean. And it's not like past profits are necessarily going to help "weather the storm".
- rtpg 4y ago
  If OpenWork snippets [0] are to be believed, sounds like people after a couple of years (5)? are making 7M. People citing entry-level pay as 5M. Managers at 10M JPY. General "salary based on years of service" stuff. Now... I think in Kyoto that's a pretty decent number! Tech company salaries in Kansai are _so much worse_ than in Kanto when I looked (5 years ago but). But if you're in Tokyo and making that... honestly you are gonna be better off elsewhere. I have seen worse numbers at other game companies, but hearing 500k+ per head in profit, it's kind of disgusting they don't pay a bit more. [0] https://www.vorkers.com/company_answer.php?m_id=a0910000000FrgK&q_no=2 https://www.vorkers.com/company_answer.php?m_id=a0910000000F...
  - deleted 4y ago
    [deleted]
  - dchftcs 4y ago
    To add insult to injury, I'm guessing the lawyers that help them enforce their IPs are paid better than their top engineers and artists, also because of a disparity in typical outside options. My experience with Japanese people and some anectodes from a friend who worked at Nintendo is that bureaucracy, culture expectations that you shouldn't change jobs at all, and English ability are some of the strong limiting factors for Japanese rank and file employees to achieve high pay. It's a shame as Japan has so many smart people who are both down to earth and innovative.
- Wolfenstein98k 4y ago
  "And it's not like past profits are necessarily going to help "weather the storm"." It is if they're not paying out (all) the profits to shareholders. Nothing stopping them building a war chest for tough times. Maybe that's why they're increasing pay and apparently not laying off staff, when competitors are doing the inverse?
gregors 4y ago
What storm? Things are going great in employment numbers and GDP growth.

Maybe this operating model is why they haven’t had to have layoffs and can weather the storm. In Japan, people value job security over maximizing expected value of compensation.

kevviiinn 4y ago

The storm of wanting to keep their obscenely large profits at the same scale? I mean, that's what the other big tech companies who are laying off employees are doing

kurikuri 4y ago

>In Japan, people value job security over maximizing expected value of compensation. I don’t think that is it. In Japan, the way of maximizing compensation is by staying in your job as long as possible, because the pay is strongly tied to seniority.

alwayslikethis 4y ago
On the whole, this is a rather more "equal" process. The top managers don't get paid the huge amounts they do in the US. However this also leads to all the unproductive situations you can imagine, with seniors running the company into the ground and the juniors not being able to do anything about it.
- papito 4y ago
  It always fascinates me how Japan is full of anachronistic, counter-productive traditions and is also one of the most advanced countries in the world at the same time. The whole place is full of contradictions. If everyone works absolutely insane hours and has no life, one would imagine the life expectancy would be shot as well, just due to the stress. Someone explain this to me.
  - bobthepanda 4y ago
    Japan was one of the most advanced countries in the world. The country has been stagnating for quite a while. South Korea and Taiwan have since eclipsed it by PPP-adjusted metrics per person. (Japanese make higher paper incomes than South Koreans and Taiwanese, but they also generally pay more for imports due to tariffs.)
  - robertlagrant 4y ago
    My off the cuff theory is perhaps their diet is very good, so offsets some of the shortened life expectancy from stress? On the graph of stress vs diet, where being in the top right is the worst for life expectancy, being high on only one might help. Having said that, I don't know if the average Japanese diet is good. Just postulating a possibility.
    - alwayslikethis 4y ago
      On the whole it is probably better than US, but it's not like they don't have unhealthy habits either. Smoking is far more common than in most Western countries. Drinking I'm not so sure, but they do have the custom of forced work drinking parties, and most Asians have the gene that produce extra toxins from alcohol, so the harm from drinking must not be negligible. I would posit that the life expectancy is in part due to lack of documentation of dying. There are many cases in Tokyo where old people living alone are found dead only weeks later when neighbors complained about the smell.
  - deleted 4y ago
    [deleted]

lph 4y ago

Most of the tech companies having layoffs don't "have to" have layoffs. They're doing it to depress worker compensation across the whole sector. It's a shameless money grab at the expense of their employees.

Godel_unicode 4y ago
That’s an interesting theory, how do you reconcile it with the fact that several companies which have had layoffs have also given out large stock refreshes to some of the employees who weren’t laid off?
- jonathankoren 4y ago
  Easy. You said it yourself. “Some”.
542458 4y ago
This doesn’t really make sense to me from a game theory POV. As a company, laying off productive employees of my own has an insignificant impact on the total sector’s compensation, but reduces my output and therefore profitability. Why would I do it? If I think there’s some big sector-wide conspiracy to unnecessarily cause layoffs to depress wages, my dominant strategy is to not participate - I still gain the full benefits (since my own participation has only a trivial impact on the outcome), but without hurting my own output.
- P_I_Staker 4y ago
  If you're Amazon it would... this wouldn't be the first time companies colluded to suppress wages in SV. It might not even be explicit collusion. These companies do have other motivations for these changes.
- brianwawok 4y ago
  I don’t think dropping the lowest 10% of developers is hurting your output. It might even raise it.

dchftcs 4y ago

It seems Nintendo profits were 4B+ last year. It has ~7000 employees, working out to 500k+ per head in profit (not revenue). I can't readily find compensation data but given the low pay in Japan I'd be surprised if the average annual compensation is substantially higher than 100k. They definitely have a lot of room to increase pay despite whatever risk you mean. And it's not like past profits are necessarily going to help "weather the storm".

rtpg 4y ago
If OpenWork snippets [0] are to be believed, sounds like people after a couple of years (5)? are making 7M. People citing entry-level pay as 5M. Managers at 10M JPY. General "salary based on years of service" stuff. Now... I think in Kyoto that's a pretty decent number! Tech company salaries in Kansai are _so much worse_ than in Kanto when I looked (5 years ago but). But if you're in Tokyo and making that... honestly you are gonna be better off elsewhere. I have seen worse numbers at other game companies, but hearing 500k+ per head in profit, it's kind of disgusting they don't pay a bit more. [0] https://www.vorkers.com/company_answer.php?m_id=a0910000000FrgK&q_no=2 https://www.vorkers.com/company_answer.php?m_id=a0910000000F...
- deleted 4y ago
  [deleted]
- dchftcs 4y ago
  To add insult to injury, I'm guessing the lawyers that help them enforce their IPs are paid better than their top engineers and artists, also because of a disparity in typical outside options. My experience with Japanese people and some anectodes from a friend who worked at Nintendo is that bureaucracy, culture expectations that you shouldn't change jobs at all, and English ability are some of the strong limiting factors for Japanese rank and file employees to achieve high pay. It's a shame as Japan has so many smart people who are both down to earth and innovative.
Wolfenstein98k 4y ago
"And it's not like past profits are necessarily going to help "weather the storm"." It is if they're not paying out (all) the profits to shareholders. Nothing stopping them building a war chest for tough times. Maybe that's why they're increasing pay and apparently not laying off staff, when competitors are doing the inverse?

gregors 4y ago

What storm? Things are going great in employment numbers and GDP growth.