4 ms·

> I can pay hundreds of people to mow my lawn using scissors, and they will be employed as landscapers. Or I can pay one guy with a lawnmower. Right, but that

by orra 3y ago

> I can pay hundreds of people to mow my lawn using scissors, and they will be employed as landscapers. Or I can pay one guy with a lawnmower. Right, but that's not the actual dichotomy. First, if Shopify can deliver its software with less people, then with the same number of people they could deliver more. Second, realistically the dichotomy, in the short to medium term, is will these people be employed in a skilled job, or will they be unemployed? You might say, that's not Shopify's problem. But let's not pretend unemployed people is "better for society".

endisneigh 3y ago
the unemployment rate is 3.5% > then with the same number of people they could deliver more. this is not true to begin with. classic engineering fallacy
- zimpenfish 3y ago
  > this is not true to begin with. classic engineering fallacy Are you assuming they'd be put onto the existing projects (which may slow down delivery, yes) rather than doing new projects in parallel (which will not and will in fact let them deliver more because there are more projects)?
  - endisneigh 3y ago
    you're simply doubling down on the fallacy. doing more projects does not mean you're delivering more. code is not value. there needs to be clear demand for what is being produced and management needs to have effective leadership to make sure the right people are doing the right things. all of which require effort. in lieu of that, it's better to lay people off from the company's perspective. if and when they understand the scope of the problem and the demand is there they will hire more people. that's more or less how to economy works.
monero-xmr 3y ago
You are assuming that there is an infinite number of people that can be added to Shopify’s payroll that will increase the product’s usefulness and increase revenue enough to justify their hiring. The company leadership doesn’t believe that. There is a line where adding more people will not justify enough revenue increase, and that’s up to the company leaders to decide. It’s worse for the people laid off, but ultimately wouldn’t they want to do something useful? In a new job they will be wanted. At Shopify they are not wanted.
- orra 3y ago
  We're not talking about hiring more people, let alone an infinite number. Simply I am pointing out the downsides of laying off people.
  - mattbrewsbytes 3y ago
    You're not taking into account that "deliver more" isn't an infinite type of thing that can happen. There is a threshold with market/product fit where "more" doesn't mean more revenue and benefit to shareholders. I think this is something all companies struggle with: at some point you may achieve product/market maturity but the people that could determine this are fundamentally in conflict with ever communicating this because they or their peers would be out of work at that employer. In my opinion, this is when internal politics start to become more prevalent because its human nature to protect your well being/source of money.
- bwestergard 3y ago
  To put it another way, you believe that a welfare maximizing equilibrium can not only be achieved in principle, but is routinely achieved in practice with minimal friction? This is difficult to believe. I think everyone sees signs all around them of foolish decisions by firm principals that hamper consumer and worker welfare even in the short term, to say nothing of the effect of various kinds of hysteresis on the long term development path of economies (e.g. detaching people from the labor market in a manner that undermines their health, currency of their skills, etc.)
- 3y ago
IMTDb 3y ago
> if Shopify can deliver its software with less people, then with the same number of people they could deliver more That is assuming everyone contributes in a meaningful way. That might not be the case for various reasons: - Incompetence / lazyness - You feel productive, but you impact is actually really low ("I am preparing an alignment meeting") - You are working on a product / component that generates little to no revenue/interest (Hello "metaverse" team from Facebook) - Your skill are not highly required at the moment and don't seem to be required in a short/mid term; someone else surely needs you more. Sometimes, doing more is not necessarily the right thing. 37 signals is famously known to have far enough revenues to hire a ton of guys and probably launch many new products. Yet, they choose to remain at a fixed headcount for now and return the profits to their shareholders. They do not hesitate to let people / fire them if they feel the need to despite their profits. Why can't Shopify follow the same strategy; albeit at a different headcount ?
- revelio 3y ago
  I thought 37signals is privately owned. How do you know how much revenue they have?
  - IMTDb 3y ago
    I have no idea of their exact numbers. But The CEO publicly said they generate tens of millions of profits every year [1]. This is for a company of around 30 to 40 employees. https://twitter.com/jasonfried/status/1212837791031279616?lang=fr https://twitter.com/jasonfried/status/1212837791031279616?la...
lasftew 3y ago
The fallacy is that organizations as a whole can only do so many different things efficiently. Capital allocation becomes less efficient if a single hierarchically structured entity has to decide on how and where to invest its capital, compared to the alternative of free market competition for capital (as usual ceteris paribus).

by orra 3y ago

endisneigh 3y ago

the unemployment rate is 3.5% > then with the same number of people they could deliver more. this is not true to begin with. classic engineering fallacy

zimpenfish 3y ago
> this is not true to begin with. classic engineering fallacy Are you assuming they'd be put onto the existing projects (which may slow down delivery, yes) rather than doing new projects in parallel (which will not and will in fact let them deliver more because there are more projects)?
- endisneigh 3y ago
  you're simply doubling down on the fallacy. doing more projects does not mean you're delivering more. code is not value. there needs to be clear demand for what is being produced and management needs to have effective leadership to make sure the right people are doing the right things. all of which require effort. in lieu of that, it's better to lay people off from the company's perspective. if and when they understand the scope of the problem and the demand is there they will hire more people. that's more or less how to economy works.

monero-xmr 3y ago

You are assuming that there is an infinite number of people that can be added to Shopify’s payroll that will increase the product’s usefulness and increase revenue enough to justify their hiring. The company leadership doesn’t believe that. There is a line where adding more people will not justify enough revenue increase, and that’s up to the company leaders to decide. It’s worse for the people laid off, but ultimately wouldn’t they want to do something useful? In a new job they will be wanted. At Shopify they are not wanted.

orra 3y ago
We're not talking about hiring more people, let alone an infinite number. Simply I am pointing out the downsides of laying off people.
- mattbrewsbytes 3y ago
  You're not taking into account that "deliver more" isn't an infinite type of thing that can happen. There is a threshold with market/product fit where "more" doesn't mean more revenue and benefit to shareholders. I think this is something all companies struggle with: at some point you may achieve product/market maturity but the people that could determine this are fundamentally in conflict with ever communicating this because they or their peers would be out of work at that employer. In my opinion, this is when internal politics start to become more prevalent because its human nature to protect your well being/source of money.
bwestergard 3y ago
To put it another way, you believe that a welfare maximizing equilibrium can not only be achieved in principle, but is routinely achieved in practice with minimal friction? This is difficult to believe. I think everyone sees signs all around them of foolish decisions by firm principals that hamper consumer and worker welfare even in the short term, to say nothing of the effect of various kinds of hysteresis on the long term development path of economies (e.g. detaching people from the labor market in a manner that undermines their health, currency of their skills, etc.)
3y ago

IMTDb 3y ago

> if Shopify can deliver its software with less people, then with the same number of people they could deliver more That is assuming everyone contributes in a meaningful way. That might not be the case for various reasons: - Incompetence / lazyness - You feel productive, but you impact is actually really low ("I am preparing an alignment meeting") - You are working on a product / component that generates little to no revenue/interest (Hello "metaverse" team from Facebook) - Your skill are not highly required at the moment and don't seem to be required in a short/mid term; someone else surely needs you more. Sometimes, doing more is not necessarily the right thing. 37 signals is famously known to have far enough revenues to hire a ton of guys and probably launch many new products. Yet, they choose to remain at a fixed headcount for now and return the profits to their shareholders. They do not hesitate to let people / fire them if they feel the need to despite their profits. Why can't Shopify follow the same strategy; albeit at a different headcount ?

revelio 3y ago
I thought 37signals is privately owned. How do you know how much revenue they have?
- IMTDb 3y ago
  I have no idea of their exact numbers. But The CEO publicly said they generate tens of millions of profits every year [1]. This is for a company of around 30 to 40 employees. https://twitter.com/jasonfried/status/1212837791031279616?lang=fr https://twitter.com/jasonfried/status/1212837791031279616?la...

lasftew 3y ago

The fallacy is that organizations as a whole can only do so many different things efficiently. Capital allocation becomes less efficient if a single hierarchically structured entity has to decide on how and where to invest its capital, compared to the alternative of free market competition for capital (as usual ceteris paribus).