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Wasn't Welch the one who was using "sack 10% of the managers each year" as a strategy? That one was obviously long-term stupid; I can see it being healthy for m
by roenxi 3y ago
Wasn't Welch the one who was using "sack 10% of the managers each year" as a strategy? That one was obviously long-term stupid; I can see it being healthy for maybe a cycle or 2, but after that it would just kill off all the intangibles of management. At some level, every company relies on a culture of people doing the right thing to thrive over the long term.
Although I do think that it is a mistake to just pin blame on Welch for that. There is a pretty solid amount of evidence that the WWII-era-boom US started falling apart from the early 1970s; there were a lot of ugly trends that took hold after US traditional oil production peaked. One of the symptoms is that nobody important seems to see a model where the States are a world class manufacturer. If nobody sees a way to run manufacturing companies at as high-performance entities then it won't happen. There is a lot of blame to be assigned to the space between the CEOs.
That is to say, my thesis is that management is optimising correctly in context - but they are in a context where US manufacturing excellence doesn't make as much sense as it once did.
- KerrAvon 3y agoYour context is that US manufacturing was uncompetitive by the early 1970’s? Gonna need to back that one up.
- roenxi 3y ago* Becoming unproductive from the 1970s. The difference is one of velocity rather than location. If we're talking "global manufacturing excellence" the trends have been favouring Asia for a while. See also https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/ where a bunch of important changes are showcased. Modern management styles that aren't good make a lot of sense sense when considering a lot of those graphs. Financial shenanigans have a lot more payoff than manufacturing, and manufacturing gets harder as the energy squeeze happens.
- hakfoo 3y agoThe reason US manufacturing excellence doesn't make sense is because we let it rot. We don't have cities like Shenzhen, where everything you need to get a product to market is within same-day courier range. I understand this was a feature of the old "hardware-centric" Silicon Valley, and it made fast iterations on new products a lot more viable. I wonder if we could even build a hub like that today, with property speculators and NIMBYism blocking anything short of grabbing a cornfield in Iowa and declaring it our new national manufacturing centrepiece. We've completely ceded on education, and that was realistically where we could have competed. We could never match the labour prices of China or Viet Nam, but we could offer better trained workers. Our schools are a disaster, and it feels like we've completely lost a focus on competitiveness. It was only a few years ago, we were very fixated about being beaten in test scores, but now the focus has been lost to social battles (scares over LGBTQ+ content) which suck all the oxygen out of the room when people want to ask about actual student achievement. We don't have the right backing for moonshot inventions. The way we lost solar panels to the PRC should be a freaking embarrassment. We knew for 40 years that people are going to want these things. Moreover, it was a new technology-- you didn't need to fight with entrenched players that didn't want to retool (like EVs)-- all you needed was a stream of seed capital and friendly loans to make sure people built here first. This might be helped with some more government intervention-- strong industrial development finance products with a VC-esque mentality of "90% of them will fail, but a few will pay off 50-fold". The state is a good backer here, because they can take the "50-fold" in forms other than raw stock appreciation, like "securing an industrial edge for our country."
- coliveira 3y agoIndustry was already lost when solar panels started to become a thing. That was never going to be a possibility for the USA, unless it changed its course.
- gumby 3y agoCarter installed solar panels on the roof of the White House. Reagan laughed, removed them, and increased drilling.
- pfdietz 3y agoI believe that were solar hot water collectors, not PV. And, indeed, that is a technology of the past now.
- paganel 3y agoExactly, you weren't going to get talented, committed smart young persons into the solar industry in the late 2000s - early 2010s, all the money was in internet tech. No solar company could have competed with the 600k yearly comps provided by companies like Google to middle-rank engineers. Tesla and everything Musk-associated bucked the trend for a while because of the literal personality cult surrounding him back then (a thing easily forgotten by now when everyone likes to hate him), that's why his companies were still able to get young talented engineers and working them very hard while not paying Google-like comps.
- hakfoo 3y agoWe have other knobs we could turn. Not every talented engineer is eager for the cut-throat hustle to chase a 600k comp package (which ends up at 70k when the stock implodes). I'd think it might even be slightly less common when you get into research and greenfield stuff-- you've got people motivated by a vision and the opportunity to deliver it. Messaging like "We have the financial and structural backing to keep the project alive indefinitely" and "This is a job for life-- if it takes you 20 years to make the breakthrough, we're willing to wait" might appeal to those people, even if the compensation is a bit lower.
- coliveira 3y agoThe correct description is death by Wall Street. Despite recent attempts, there is no way to revive industry in the USA because industrial companies cannot make the amount of profits that Wall Street wants. They are interested on monopoly power exemplified by Google and Apple, which are able to generate the juicy returns that investors want.