4 ms·

I'm not sure Spotify has really made any mistakes here though. They took a risk that didn't pan out. For an omnipotent being that would be a mistake, but for a

I'm not sure Spotify has really made any mistakes here though. They took a risk that didn't pan out. For an omnipotent being that would be a mistake, but for a person that only has the information available at the time it can still have been the right bet. Firing people when their bets don't pan out just leads to a risk averse culture that dooms any company to failure

Pentamerous 3y ago
But aren't layoffs ultimately a mistake? Shouldn't the stress of losing a job (also) be on the shoulders of who made the incorrect decisions?
digging 3y ago
Taking a risk that doesn't pan out can also be a bad idea, though. It depends on what the possible outcomes were and what the chances of each outcome were. The important thing to evaluating someone's decision making ability is to look at the decision they made with the information they had. Was it a good bet to dramatically overhire? I don't know!, but analysts can and should (rather, have no excuse not to). It's possible to determine what information the C-suite had access to and how risky they believed the decision to be. Did they play fast and loose with peoples' livelihoods for a tiny chance of unsustainable profit? Might be a bad decision.
- RestlessMind 3y ago
  It is board's job to evaluate C-suite's decisions. It is shareholders' job to appoint a proper board. Ultimately, the system has some flaws but generally it has worked pretty well over the past many decades.
  - bigtex88 3y ago
    So well. We've destroyed the planet but we have cheaper TV's, so that's a win in my book. /s
  - digging 3y ago
    I'm not talking about who is doing the evaluation. That's an obviously flawed process because the board has a stake in the company making unethical decisions for short term profit. I'm just describing what good decision making actually is. If you take an option with 20% chance of success, but few downsides if it fails and large returns if it succeeds, that's usually a good decision. If, however, the downsides are catastrophic, that's probably a bad decision. The situation here is that the downsides were arguably catastrophic, but completely externalized. The C-suite selfishly made bad decisions because it didn't affect them negatively. Doing so should reasonably have repercussions for them, but where's the incentive? An organization that places profit above all is intrinsically immoral and/or corrupt. This is obvious, we've just been allowing it for generations because we keep telling those who get hurt that things should probably work out on their own, eventually, or in the aggregate. And we convince people that an organization that places not being evil (not even martyring itself, just not doing horrible shit) just above profit can't exist. Would it be competitive? Maybe not, which is why regulation is actually useful - it can change the playing field so a company doesn't have to make that decision. (Of course, we already do this exact thing, but for extremely limited definitions of evil, and we also don't punish those evils very badly when they're committed.)
candiddevmike 3y ago
The CFO let Spotify hire all of these people based on his projections and assumptions, maybe he should've been one of them let go.

Pentamerous 3y ago

But aren't layoffs ultimately a mistake? Shouldn't the stress of losing a job (also) be on the shoulders of who made the incorrect decisions?

digging 3y ago

Taking a risk that doesn't pan out can also be a bad idea, though. It depends on what the possible outcomes were and what the chances of each outcome were. The important thing to evaluating someone's decision making ability is to look at the decision they made with the information they had. Was it a good bet to dramatically overhire? I don't know!, but analysts can and should (rather, have no excuse not to). It's possible to determine what information the C-suite had access to and how risky they believed the decision to be. Did they play fast and loose with peoples' livelihoods for a tiny chance of unsustainable profit? Might be a bad decision.

RestlessMind 3y ago
It is board's job to evaluate C-suite's decisions. It is shareholders' job to appoint a proper board. Ultimately, the system has some flaws but generally it has worked pretty well over the past many decades.
- bigtex88 3y ago
  So well. We've destroyed the planet but we have cheaper TV's, so that's a win in my book. /s
- digging 3y ago
  I'm not talking about who is doing the evaluation. That's an obviously flawed process because the board has a stake in the company making unethical decisions for short term profit. I'm just describing what good decision making actually is. If you take an option with 20% chance of success, but few downsides if it fails and large returns if it succeeds, that's usually a good decision. If, however, the downsides are catastrophic, that's probably a bad decision. The situation here is that the downsides were arguably catastrophic, but completely externalized. The C-suite selfishly made bad decisions because it didn't affect them negatively. Doing so should reasonably have repercussions for them, but where's the incentive? An organization that places profit above all is intrinsically immoral and/or corrupt. This is obvious, we've just been allowing it for generations because we keep telling those who get hurt that things should probably work out on their own, eventually, or in the aggregate. And we convince people that an organization that places not being evil (not even martyring itself, just not doing horrible shit) just above profit can't exist. Would it be competitive? Maybe not, which is why regulation is actually useful - it can change the playing field so a company doesn't have to make that decision. (Of course, we already do this exact thing, but for extremely limited definitions of evil, and we also don't punish those evils very badly when they're committed.)

candiddevmike 3y ago

The CFO let Spotify hire all of these people based on his projections and assumptions, maybe he should've been one of them let go.