4 ms·

I've noticed a lot of people, even ones making $200k+ in salary, are really bad when it comes to making decisions that involve any amount of money. E.g. I've b

by cj 3y ago

I've noticed a lot of people, even ones making $200k+ in salary, are really bad when it comes to making decisions that involve any amount of money. E.g. I've been in meetings with multiple developers who, if you add up everyone's salary, is well over $1 million/year, debating for way too much time on whether it's worth it to buy a $500/month service to help automate some aspect of devops. Maybe this wasn't the case for your specific anecdote, but in the scenario I'm describing I got the feeling that a lot of people think about business purchases in the context of their own personal finances rather than in the context of the business's finances. Leading people to be extremely cautious with things like a $10k purchase that would be "expensive" if purchased as an individual and "cheap" if purchased as a company. In those cases, getting an exec to come in and pull the trigger can help. The exec is used to looking at big picture budgets/strategy, which IC's aren't. (Although I'm sure someone here can come up with another anecdote proving that wrong)

cogman10 3y ago
Lol, that reminds me of another fun one. Every so often my company would provide lunches for the developers. However, they didn't want to spend too much money doing this. So how did they resolve it? They put together a committee of devs to discuss lunch options/etc. Easily 1+million/year of salary in one room debating whether we do Jimmy Johns or McDonalds and how they'd get the food to the office. For $2000, you can get some pretty nice catering for 100 people. But like you said, people just seem bad at thinking of that sort of big picture.
- pants2 3y ago
  Providing daily lunches to developers is an insane ROI and I don't know why it's not standard practice. It's pennies compared to their salary, and they are happier, spend more time thinking about work instead of what/where to get lunch, spend more time eating together and conversing, and probably eat healthier food which mitigates the post-lunch coma.
  - mnahkies 3y ago
    +1 to this, I had one job where lunch was provided and it very much brought people together, particularly across team boundaries / job levels, and often "tricked" you into having pseudo meetings over lunch. I find that still happens organically in smaller companies without, but in larger companies things trend towards more clique like behaviour without it (caveat small sample size)
  - cogman10 3y ago
    Used to be something that companies just generally recognized as a good thing. Look at workplaces built in the 60 to 80s and basically all of them had cafeterias as part of the building plan. [1] [1] https://www.nytimes.com/1985/11/24/nyregion/company-cafeterias-as-corporate-tool.html https://www.nytimes.com/1985/11/24/nyregion/company-cafeteri...
    - jdsully 3y ago
      They were generally paid cafeterias though.
      - dkjaudyeqooe 3y ago
        When I worked at a merchant bank in London in the 90s there was a very good cafeteria with great food that was not free, but it was so subsidised that it might as well be.
      - cogman10 3y ago
        Subsidized. The trick was striking a balance in making the food cheap enough that the employees would eat it but not so cheap that the company is footing the entire bill.
  - phonon 3y ago
    In part since it's a taxable benefit to the employee, absent extenuating circumstances. Not all employees want to "pay" for "free" food. https://taxnews.ey.com/news/2019-0493-employer-must-substantiate-necessity-of-employer-provided-meals-for-value-to-be-excluded-from-employee-income-irs-tam-emphasizes https://taxnews.ey.com/news/2019-0493-employer-must-substant...
- ajacksified 3y ago
  Same thing with hardware in every company I've worked at. Really, "Sr. Staff Engineer Alice" makes $300k/yr, but only gets a budget of $2k for a laptop that's meant to last four years and is their primary tool? How does this make sense?
  - dkjaudyeqooe 3y ago
    I see devs that are paid a fortune and they use these silly 20 or 24 inch monitors and I don't understand it. A large 4K monitor is a very cheap and really increases productivity. Give them 3 ffs. Meanwhile, there is an accountant somewhere that thinks he's a genius for keeping the hardware budget in check.
- skirmish 3y ago
  Another good one: my company periodically forces all software engineers to wipe their workstations / laptops and re-install everything from scratch. I have one such wipe coming up, with no way to avoid it, will probably spend 3-4 days just setting up all software again and do no work.
rmckayfleming 3y ago
Yea, people generally don't think about these things. People were genuinely surprised to find out that 70% of our expenses as a software business were... salaries. The next largest category? Rent. Everything else was effectively a rounding error.
mnahkies 3y ago
Internalising what's a reasonable business expense compared to personal expenses is a skill I feel I've only fairly recently developed. It's super important to consider the human cost and opportunity cost of each decision, and it's scaling characteristics. Eg: spending $20+k on a ci system like circleci, GitHub actions, whatever might feel like a big purchase, but if you consider that split by the number of developers using it, their salaries, and that in general it scales with your head count rather than user count suddenly it's pretty attractive. On the other hand some other seemingly small (unit) cost that applies per user of your product might be worth optimizing/eliminating as that can have a big impact on your margins - but even then you need to balance it against opportunity cost. We could increase margins by x% with y investment, or increase revenue by z doing something else where the delta of revenue outweighs the better margins. Basically it's a big juggling act involving numbers that we're not used to dealing with in our personal finance and you need to ground your thinking in terms scaling characteristics and the companies overall revenue/burn to appreciate what actually moves the needle.

by cj 3y ago

cogman10 3y ago

Lol, that reminds me of another fun one. Every so often my company would provide lunches for the developers. However, they didn't want to spend too much money doing this. So how did they resolve it? They put together a committee of devs to discuss lunch options/etc. Easily 1+million/year of salary in one room debating whether we do Jimmy Johns or McDonalds and how they'd get the food to the office. For $2000, you can get some pretty nice catering for 100 people. But like you said, people just seem bad at thinking of that sort of big picture.

pants2 3y ago
Providing daily lunches to developers is an insane ROI and I don't know why it's not standard practice. It's pennies compared to their salary, and they are happier, spend more time thinking about work instead of what/where to get lunch, spend more time eating together and conversing, and probably eat healthier food which mitigates the post-lunch coma.
- mnahkies 3y ago
  +1 to this, I had one job where lunch was provided and it very much brought people together, particularly across team boundaries / job levels, and often "tricked" you into having pseudo meetings over lunch. I find that still happens organically in smaller companies without, but in larger companies things trend towards more clique like behaviour without it (caveat small sample size)
- cogman10 3y ago
  Used to be something that companies just generally recognized as a good thing. Look at workplaces built in the 60 to 80s and basically all of them had cafeterias as part of the building plan. [1] [1] https://www.nytimes.com/1985/11/24/nyregion/company-cafeterias-as-corporate-tool.html https://www.nytimes.com/1985/11/24/nyregion/company-cafeteri...
  - jdsully 3y ago
    They were generally paid cafeterias though.
    - dkjaudyeqooe 3y ago
      When I worked at a merchant bank in London in the 90s there was a very good cafeteria with great food that was not free, but it was so subsidised that it might as well be.
    - cogman10 3y ago
      Subsidized. The trick was striking a balance in making the food cheap enough that the employees would eat it but not so cheap that the company is footing the entire bill.
- phonon 3y ago
  In part since it's a taxable benefit to the employee, absent extenuating circumstances. Not all employees want to "pay" for "free" food. https://taxnews.ey.com/news/2019-0493-employer-must-substantiate-necessity-of-employer-provided-meals-for-value-to-be-excluded-from-employee-income-irs-tam-emphasizes https://taxnews.ey.com/news/2019-0493-employer-must-substant...
ajacksified 3y ago
Same thing with hardware in every company I've worked at. Really, "Sr. Staff Engineer Alice" makes $300k/yr, but only gets a budget of $2k for a laptop that's meant to last four years and is their primary tool? How does this make sense?
- dkjaudyeqooe 3y ago
  I see devs that are paid a fortune and they use these silly 20 or 24 inch monitors and I don't understand it. A large 4K monitor is a very cheap and really increases productivity. Give them 3 ffs. Meanwhile, there is an accountant somewhere that thinks he's a genius for keeping the hardware budget in check.
skirmish 3y ago
Another good one: my company periodically forces all software engineers to wipe their workstations / laptops and re-install everything from scratch. I have one such wipe coming up, with no way to avoid it, will probably spend 3-4 days just setting up all software again and do no work.

rmckayfleming 3y ago

Yea, people generally don't think about these things. People were genuinely surprised to find out that 70% of our expenses as a software business were... salaries. The next largest category? Rent. Everything else was effectively a rounding error.

mnahkies 3y ago

Internalising what's a reasonable business expense compared to personal expenses is a skill I feel I've only fairly recently developed. It's super important to consider the human cost and opportunity cost of each decision, and it's scaling characteristics. Eg: spending $20+k on a ci system like circleci, GitHub actions, whatever might feel like a big purchase, but if you consider that split by the number of developers using it, their salaries, and that in general it scales with your head count rather than user count suddenly it's pretty attractive. On the other hand some other seemingly small (unit) cost that applies per user of your product might be worth optimizing/eliminating as that can have a big impact on your margins - but even then you need to balance it against opportunity cost. We could increase margins by x% with y investment, or increase revenue by z doing something else where the delta of revenue outweighs the better margins. Basically it's a big juggling act involving numbers that we're not used to dealing with in our personal finance and you need to ground your thinking in terms scaling characteristics and the companies overall revenue/burn to appreciate what actually moves the needle.