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I appreciate the insight in the OP, but I'm frustrated by the imprecise use of language. Valve is hierarchical. The hierarchy is simply informal and spontaneous

by mhartl 14y ago

I appreciate the insight in the OP, but I'm frustrated by the imprecise use of language. Valve is hierarchical. The hierarchy is simply informal and spontaneous based on the attributes of individual team members. (The OP hints at the distinction with the occasional modification "authoritarian hierarchy", but this line is often blurred.) In addition, the notion that Valve is "bossless" is disingenuous. For every person at Valve, there is some other person (or persons) who can fire him. If you worked at Valve, that person could in principle tell you what to do. That he doesn't have to is a product of the kind of people who work at Valve, not any radical innovation in corporate structure. Although its organization may be relatively flat, Valve is strictly hierarchical by any sensible definition of the term. Valve's model reminds me of the old Costco vs. Walmart debates. Costco, we are told, get lots more productivity out of its workers by treating them well—good pay, generous benefits, etc.—while Walmart suffers by comparison. What this analysis ignores is that the people are different. Costco has discovered that it can thrive by compensating disciplined, productive people well. Google does the same. Apparently so does Valve. But not all people have such discipline or high productive capacity—you couldn't just swap all Costco employees for the same number of Walmart employees and expect to get the same results, any more than you could with Google or Valve. The miracle of Walmart (or one of them, at least) is that they manage to thrive using the labor of people whose productivity is often marginal by the standards of Costco or Valve. Arguably, that is even more impressive, and perhaps more laudable. Unsurprisingly, Walmart's corporate structure is very un-Valve-like.

dgreensp 14y ago
Indeed, every person is different, and every job is different. Corporations already create a huge diversity of jobs that can't be equated across companies. I can hire 100 programmers and say "your job description is to do whatever you want," and there is nothing inherently anti-capitalist or post-capitalist about my company. If I can make it productive by virtue of cultural and social pressures alone rather than bossing people around, that's great. As the OP points out himself, corporations are "islands" as far as the larger economic system. There aren't really inherent constraints on how you organize them internally. There are handed-down "best practices" for management that are probably long overdue for rethinking; for example, perhaps the notion of today's "boss" or middle manager will come to seem antiquated. But no company runs like a free market. The OP spends a lot of time identifying "traditional capitalist corporation" with bosses and hierarchy in order to paint Valve as less capitalist, but really it is just less "bossist." To say Valve is "more radical" than a co-op with distributed ownership is ridiculous, and misses Valve's own hierarchy (as my parent points out). Owning and running a company is not just a matter of telling people what to do. It includes hiring and firing, leading through culture and other channels, making executive decisions and generally keeping the lights on. As a Valve employee, can you fire the janitor if he isn't doing a good job? If the building is hit by a tornado, is it your responsibility to get it rebuilt and eat the cost? Being an owner isn't all peaches and gravy. Could you decide you want a non-wheelie desk or to telecommute full-time from the beach? Hopefully you don't want to. Could the owner decrease your compensation or relocate the company offices to Kalamazoo? Hopefully he doesn't want to. The best management is invisible.
- napillo 14y ago
  I could see Valve's structure being good for a game company, but little else. I can't imagine writing business software, and then just publishing it and releasing a service pack and being done with it. When customers ask "when can I get feature X" they don't want to hear "oh our developers stopped working on it because they are working on Project Y, so how about never?".
- kasbah 14y ago
  "You can do as you will but not will as you will"
gruseom 14y ago
I think you and a few others are selling Valve and the article a little short. Varoufakis does give a precise definition of what he means by non-hierarchical: free allocation of individual time. How is that not a radical innovation? Nearly every other corporation is a tyranny by comparison. And it's not just that they happened to hire people who work this way. It was clearly a conscious design decision and probably couldn't have gotten started any other way. (BTW, I don't think you can have an "informal and spontaneous" hierarchy, or a "flat" one. Those are oxymorons. Hierarchy by definition is a formal gradation of ranks. No?) Varoufakis is careful to distinguish this management structure from Valve's ownership structure, which is hierarchical. Many people have pointed out that ultimately there has to be a boss at Valve: the owner. He implies this too when he points out that its management structure depends on the "enlightenment" of the owners "not using their property rights to boss people around". So yes, whatever this experiment is, it isn't communism. That doesn't mean it isn't radical! I think we're hypnotized a bit by having been raised with "capitalism" and "communism" as the only two poles of a binary system, where communism was an obvious failure so therefore the status quo is the only possibility... (not implying that this is your view, just that it's in our water). Besides which it's not obvious that Valve's structure is anti-capitalist. The way Varoufakis describes it, it's an extension and generalization of capitalism: extension because market dynamics are being applied to what has traditionally been monolithic bureaucracy; generalization because something other than price – namely, time – is being used inside Valve to signal value. (Anti-corporatist, sure. And yay! But I digress.) Ownership must have an impact on how the company functions, so there are unanswered questions here. But let's not naively assume that ownership trumps everything. Suppose the owners decided tomorrow, "We tire of this experiment. The experiment is hereby changed to neo-Stalinism." Would people at Valve glumly bow their heads and say, "oh, ok"? Likely not. Some would leave; others would resist. It's not clear what would happen. So yes, vertical ownership does imply power - but not absolute power, except perhaps to destroy the whole thing. Seems to me the big unanswered questions are: (1) relation of ownership and management structures, (2) how hiring and firing really work. The latter is the most important use of management power, so it's the big test of how non-hierarchically Valve really operates. Especially firing. No matter how good their "filters for self-motivated people" are, they can't be perfect. When firing is necessary, how is it really done? A lot of people seem to be imagining that it must work like this: you get called into Gabe's office and Gabe says, "we're not that anarcho-syndicalist, you're fired." That would indeed be hierarchical. But we don't know this. And even if it were true, it wouldn't completely destroy the experiment. I don't think their claims are quite as utopian as some of the more cynical/debunking commenters assume. Thinking about this as "utopia or not" makes it less interesting.

by mhartl 14y ago

dgreensp 14y ago

Indeed, every person is different, and every job is different. Corporations already create a huge diversity of jobs that can't be equated across companies. I can hire 100 programmers and say "your job description is to do whatever you want," and there is nothing inherently anti-capitalist or post-capitalist about my company. If I can make it productive by virtue of cultural and social pressures alone rather than bossing people around, that's great. As the OP points out himself, corporations are "islands" as far as the larger economic system. There aren't really inherent constraints on how you organize them internally. There are handed-down "best practices" for management that are probably long overdue for rethinking; for example, perhaps the notion of today's "boss" or middle manager will come to seem antiquated. But no company runs like a free market. The OP spends a lot of time identifying "traditional capitalist corporation" with bosses and hierarchy in order to paint Valve as less capitalist, but really it is just less "bossist." To say Valve is "more radical" than a co-op with distributed ownership is ridiculous, and misses Valve's own hierarchy (as my parent points out). Owning and running a company is not just a matter of telling people what to do. It includes hiring and firing, leading through culture and other channels, making executive decisions and generally keeping the lights on. As a Valve employee, can you fire the janitor if he isn't doing a good job? If the building is hit by a tornado, is it your responsibility to get it rebuilt and eat the cost? Being an owner isn't all peaches and gravy. Could you decide you want a non-wheelie desk or to telecommute full-time from the beach? Hopefully you don't want to. Could the owner decrease your compensation or relocate the company offices to Kalamazoo? Hopefully he doesn't want to. The best management is invisible.

napillo 14y ago
I could see Valve's structure being good for a game company, but little else. I can't imagine writing business software, and then just publishing it and releasing a service pack and being done with it. When customers ask "when can I get feature X" they don't want to hear "oh our developers stopped working on it because they are working on Project Y, so how about never?".
kasbah 14y ago
"You can do as you will but not will as you will"

gruseom 14y ago

I think you and a few others are selling Valve and the article a little short. Varoufakis does give a precise definition of what he means by non-hierarchical: free allocation of individual time. How is that not a radical innovation? Nearly every other corporation is a tyranny by comparison. And it's not just that they happened to hire people who work this way. It was clearly a conscious design decision and probably couldn't have gotten started any other way. (BTW, I don't think you can have an "informal and spontaneous" hierarchy, or a "flat" one. Those are oxymorons. Hierarchy by definition is a formal gradation of ranks. No?) Varoufakis is careful to distinguish this management structure from Valve's ownership structure, which is hierarchical. Many people have pointed out that ultimately there has to be a boss at Valve: the owner. He implies this too when he points out that its management structure depends on the "enlightenment" of the owners "not using their property rights to boss people around". So yes, whatever this experiment is, it isn't communism. That doesn't mean it isn't radical! I think we're hypnotized a bit by having been raised with "capitalism" and "communism" as the only two poles of a binary system, where communism was an obvious failure so therefore the status quo is the only possibility... (not implying that this is your view, just that it's in our water). Besides which it's not obvious that Valve's structure is anti-capitalist. The way Varoufakis describes it, it's an extension and generalization of capitalism: extension because market dynamics are being applied to what has traditionally been monolithic bureaucracy; generalization because something other than price – namely, time – is being used inside Valve to signal value. (Anti-corporatist, sure. And yay! But I digress.) Ownership must have an impact on how the company functions, so there are unanswered questions here. But let's not naively assume that ownership trumps everything. Suppose the owners decided tomorrow, "We tire of this experiment. The experiment is hereby changed to neo-Stalinism." Would people at Valve glumly bow their heads and say, "oh, ok"? Likely not. Some would leave; others would resist. It's not clear what would happen. So yes, vertical ownership does imply power - but not absolute power, except perhaps to destroy the whole thing. Seems to me the big unanswered questions are: (1) relation of ownership and management structures, (2) how hiring and firing really work. The latter is the most important use of management power, so it's the big test of how non-hierarchically Valve really operates. Especially firing. No matter how good their "filters for self-motivated people" are, they can't be perfect. When firing is necessary, how is it really done? A lot of people seem to be imagining that it must work like this: you get called into Gabe's office and Gabe says, "we're not that anarcho-syndicalist, you're fired." That would indeed be hierarchical. But we don't know this. And even if it were true, it wouldn't completely destroy the experiment. I don't think their claims are quite as utopian as some of the more cynical/debunking commenters assume. Thinking about this as "utopia or not" makes it less interesting.