5 ms·

It's funny because more than anything I would say the people that were most misaligned with the outcomes of the business are actually most of the engineering le

by hobs 2y ago

It's funny because more than anything I would say the people that were most misaligned with the outcomes of the business are actually most of the engineering leaders I have worked with. The amount of short-termism and chasing press releases and caring about what your golf buddies think really clogged up a lot of companies, and it doesn't feel like THAT part is changing anytime soon, zirp or no zirp.

Nextgrid 2y ago
It happened at every level - software engineers optimized for career outcomes which meant accumulating the right buzzwords. Managers optimized for their own career outcomes which meant increasing their number of direct reports. Engineering leaders optimized for their own buzzwords which means org-level complexity and a steady stream of (self-inflicted) problems to solve and brag about on their engineering blog to attract even more software engineers, and executives/founders merely optimize for securing the next funding round (because there is no and was never a viable business there to begin with), which is easier to do if you're seen as solving hard problems (even if they are self-inflicted), and investors happily oblige because they had no other choice in this distorted market. Note that incentive mismatch at the middle-management level happens everywhere to this day and isn't strictly a ZIRP-induced phenomenon, but most real businesses that need to earn a profit thus have a natural cap on how much inefficiency they can support. In ZIRP however, the complete lack of any requirement to make profit (in some cases because the business is never viable and its sole purpose is to give a good lifestyle and resume to everyone involved) exacerbated the problem.
rachofsunshine 2y ago
It's not just golf buddies - it's investors. Capital often outstrips actual business acumen as a factor in the success of a business. That's partly because we live in a world where word of mouth, reviews, online presence, etc. are all commodified, partly because tech (like the Industrial Revolution before it) has greatly increased the growth potential and concentration of capital, partly because of investors actively intervening to ensure the success of their other investments, partly because of increasing and increasingly-naked corruption, and partly because of the importance of network effects. (I don't know which of these factors is the most important.) The more important capital becomes relative to the actual functioning of a product, the more disconnected from reality a business can (perhaps must) get. Their actual business becomes selling a pitch to investors, not selling SaaS, because their actual product is investor returns, not long-term viability or value. And because a big part of that pitch to investors is the rockstar founding team, founders have to (or at least feel they have to) do the golf-buddy shit. It's literally their job, or at least, they think it is. Post-ZIRP doesn't kill that because capital being scarce just increases demand for it even more.
- oytis 2y ago
  Probably the best comment overall. Many people assume that because ZIRP was unhealthy, present situation returns us to being practical, down to earth, and caring more about engineering that the buzz. It's not what I see around myself, and not what I'm reading either. If anything, businesses become less interested in engineering quality, and there is probably less understanding than ever about how to make a good business out of engineering.

by hobs 2y ago

Nextgrid 2y ago

It happened at every level - software engineers optimized for career outcomes which meant accumulating the right buzzwords. Managers optimized for their own career outcomes which meant increasing their number of direct reports. Engineering leaders optimized for their own buzzwords which means org-level complexity and a steady stream of (self-inflicted) problems to solve and brag about on their engineering blog to attract even more software engineers, and executives/founders merely optimize for securing the next funding round (because there is no and was never a viable business there to begin with), which is easier to do if you're seen as solving hard problems (even if they are self-inflicted), and investors happily oblige because they had no other choice in this distorted market. Note that incentive mismatch at the middle-management level happens everywhere to this day and isn't strictly a ZIRP-induced phenomenon, but most real businesses that need to earn a profit thus have a natural cap on how much inefficiency they can support. In ZIRP however, the complete lack of any requirement to make profit (in some cases because the business is never viable and its sole purpose is to give a good lifestyle and resume to everyone involved) exacerbated the problem.

rachofsunshine 2y ago

It's not just golf buddies - it's investors. Capital often outstrips actual business acumen as a factor in the success of a business. That's partly because we live in a world where word of mouth, reviews, online presence, etc. are all commodified, partly because tech (like the Industrial Revolution before it) has greatly increased the growth potential and concentration of capital, partly because of investors actively intervening to ensure the success of their other investments, partly because of increasing and increasingly-naked corruption, and partly because of the importance of network effects. (I don't know which of these factors is the most important.) The more important capital becomes relative to the actual functioning of a product, the more disconnected from reality a business can (perhaps must) get. Their actual business becomes selling a pitch to investors, not selling SaaS, because their actual product is investor returns, not long-term viability or value. And because a big part of that pitch to investors is the rockstar founding team, founders have to (or at least feel they have to) do the golf-buddy shit. It's literally their job, or at least, they think it is. Post-ZIRP doesn't kill that because capital being scarce just increases demand for it even more.

oytis 2y ago
Probably the best comment overall. Many people assume that because ZIRP was unhealthy, present situation returns us to being practical, down to earth, and caring more about engineering that the buzz. It's not what I see around myself, and not what I'm reading either. If anything, businesses become less interested in engineering quality, and there is probably less understanding than ever about how to make a good business out of engineering.