Only in 2009 can you have the intersection of game balance kvetching, business ethics, and charts about the Great Recession. And believe it or not, this time it’s not even me!
This was brought to my attention by a hit on my referral logs from my earlier primal scream about the omnipresent spectre of the gaming industry collapsing into a Schwarzchild radius of incompetency; namely that I’m a big whiny baby pounding at the keyboard with my hamfists.
If there is a product to work on today, the employee will have his salary. Tomorrow is another day. If there is no need for so many workers, they will no longer be employed. It’s that simple. Obviously if there will be need for some workers, the company tries to keep the better ones, fireing the underperformers. It’s obvious self-interest.
If the employee thought of his employer as a friend, his coworkers as a group of friends, he will feel betrayed. But whose fault it is? Actually I’ve never heard any company’s slogan to be “We are here to make our employees feel good”. They usually say “we are here to serve our customers” and mean “we are here to serve our customer’s money to our owners”. No one, ever offered the employee a “freindly helpfull group of peeps”.
Well, if your coworkers aren’t a subset of your group of friends, it may well be because you are an antisocial package of chemicals that everyone installed IM at work for specifically so they could make lunch plans without you overhearing. Most of us that have moved past the point in life where we have to wear nametags and hairnets when going to work, and now work in ‘teams’. Teams of like-minded individuals, selected in part due to personal compatibility. A key part of any employment interview process, after all, is “can we work with this person?”, which should appear closely behind “can this person actually do the job we’re looking to fill”. Both, after all, are important.
But beyond that, there is a small matter of business ethics to consider. There are some, like Mr. Greedy Gecko, er Goblin, who consider the only responsibility of a company to be its bottom line. Profit uber alles, and devil take the hindmost. It’s a fairly common viewpoint – who needs ethics when simple mathematics determines the victor!
But of course, there are other factors, or should be in a world that people not goblins may want to live in. Profit is all well and good and necessary, but at some point, someone may figure out that it’s cost-effective to dilute your milk with, say, I don’t know, something wacky like plastic. Of course long term, killing off your customers may hinder your bottom line. There are long term considerations.
One of those considerations involves the welfare of your employees. These are people who have engaged in a very clear bargain with you – for a given amount of money per week, they will spend that time helping you collect wealth. It’s a standard economic transaction, on the face of it. And for lower level employees, that’s also where it stops. Someone else pays you more, you move on. Shrug.
But past the point where you wear name tags and hair nets, it becomes incumbent on you to treat your assets as assets – and your team members are definitely assets. Because when the economy isn’t busy melting down into goo, they do have options – they can move elsewhere, say to places that don’t treat them as industrial cogs. So there is a certain level of capitalist self-interest there – you keep your assets happy, your assets stay with you and don’t become someone else’s.
But that’s not all of it, at least for most of us. Most effective managers see themselves as responsible for their team. Their team members rely on them to keep the engines running so that the explicit part of the bargain – come to work daily, get paid bi-weekly – continues to happen. That carries with it responsibility. The effective managers make sure their teams, and their projects, are successful, not only because it’s part of their job description to run a successful project and generate wealth, but also because your team members are relying on you to steer that ship through icebergs. Effective managers worry about this. Effective managers lose a lot of sleep about this — and I guarantee you, it’s not because they might deliver 22% less profit to the Mothership. It’s because they’re ethical.
This is not something you’d think would have to be explained in such grueling detail, but you’d be wrong. You’d be wrong because apparently the latest craze in Pinhead Public Company Management 101 involves divesting yourself of as many employees as you can before earnings reports so that your balance sheet looks good – regardless of whether or not you’re actually making a profit. Which is disturbing enough, but then you get apologetics like this who think that there’s nothing at all wrong with throwing your ‘assets’ over the side, and invalidating your implicit contract with them, solely to make a bar on a chart move from 43 to 48. You see – it’s really your fault.
However most of us get into situations when incompetent managers order us to do something obviously stupid and harmful to the company. Creating a malfunctioning product is not a crime unless it is dangerous to people’s health, yet it is stupid. The punishment for stupidity is market loss and the subsequent layoffs.
While employees acted as instruments of managers, this “instrument state” do not relieve them from the responsibility of their actions. They could write a memo to the higher management or simply say that “this management is stupid, I quit and find another job”. While it was a strong ape-subroutine that made them obey, they had free will to act differently. The fact that the managers would deserve layoffs more than the employees, does not change that the employees deserve it too.
I read things like this, complete with pseudo-scientific references to “ape subroutines”, and wonder if 50 years ago this guy would have been on the Warsaw Judenrat. There’s apologetics, and then there’s disturbing apologetics. (And hey, he went all Godwin first, with a somewhat disturbing equation of dissenting employees and the Nuremburg trials. I’m just finishing the neuron loop!)
Of course, many of us aren’t in the position exhorted by this blogger and MMO bloggers everywhere, namely that if you disagree with the direction of the company/design decisions/overuse of the color brown you should hand in your walking papers forthwith. As pointed out by a commenter to his blog:
I don’t know if you have a family that relies on you for its income, but tell me again that I’m free to quit a job at any time with 2 kids and a wife relying no me as the sole support of income.
To which the blogger responded:
Kids are investment to the future, cost a lot today but pay back well later. However a wife is a grown person who shall be able to support herself AND half of the kids. If YOU made the choice of supporting a grown person than it’s you who have to live with the consequences.
Hey, he’s got a point. I recommend octuplets. Better return on investment, donchaknow.
I realize this entire long blog post was the rhetorical equivalent of punching a baby, but business ethics has been something on my mind lately for fairly obvious reasons. Said blogger’s image of me as a caterwauling child ramming the keyboard with my forehead aside, I have been in the position of my failures as a team member and manager being in some way responsible for people losing their jobs. Interestingly enough, the fact that it was an eminently justifiable business decision – and in one memorable case, one I personally recommended – did nothing to help me sleep that week. Because I failed. Despite the fact that recommending a course of action that resulted in layoffs was, in a business sense the right decision – that was a failure.
And the rampant, smug self justification that we’re seeing with this year’s model of layoffs and cutbacks and corporate jets and stimulus explosions is telling me that there’s quite a few people who have no problem whatsoever sleeping. And that bothers me.
Enough to slam the keyboard with my hamfists.
#1 by Rog on February 12th, 2009
@maess: You missed the 4th option, although arguably one of the harder ones to achieve: *gasp* Change the system.
I know it sounds ridiculous to some, but this “Pinhead Public Company Management 101″ status quo hasn’t existed forevermore. It’s hopefully temporary and only by people refusing to accept it, or at least demonstrating a dislike / distrust / disgust with it, is it ever likely to change.
My take on the whole economy is that we’ve somehow, during the pursuit of a ‘free market’, ended up with a system that rewards sacrificing long term stability for short term gains. In the games industry especially, this is really evident.
The sort of commentary Scott is making is valuable.
#2 by Soulflame on February 12th, 2009
Why weren’t you paying them 65k in the first place?
#3 by JuJutsu on February 12th, 2009
“Why weren’t you paying them 65k in the first place?”
I’m willing to pay SOE $15/month for a game. Does that mean that everyone should be willing to as well?
#4 by Soulflame on February 12th, 2009
Why are you comparing an MMOG fee to a salary? Do you practice regularly to be that stupid, or is it an inborn talent?
#5 by kavika on February 12th, 2009
I think a lot the problem today is that we’ve over-extended ourselves in a geographic sense. We have de-sensitized ourselves by placing large geographic gap between us and the people we have interactions with, whether they be financial, personal, or other. This is an overexaggeration, but take the recent salmonella contaminations for example. And let’s say that the peanut plant only delivered peanuts locally, and only hired people who lived nearby, and those employees’ families ate peanuts everyday. Don’t you think they would’ve been a little more careful about sending out contaminated goods? But in the real world, they didn’t care because they still got paid, and didn’t have to face the people who got the bad peanuts. The same is true with the BearStearns guys who sold off bad loans…they wouldn’t have done that if they actually had to go into town and interact with the people they ripped off. I think it’s time to get less global, and get more localized.
#6 by Veritas Gax on February 12th, 2009
Going back to the original argument of when an “asset” leaves a company to make more money elsewhere — this really only happens if a company refuses to pay someone what they think they’re worth, and another company agrees that the person IS worth that much.
It’s not a foregone conclusion that just because someone thinks they’re worth more money that they must leave the company they currently work for. In fact, I would wager that salary is rarely the reason game developers leave their companies.
Also — you don’t get paid what you’re worth. You get paid what you negotiate. That said, people who negotiate for amazing salaries are rarely asked to take a pay cut when things get lean — usually they are simply laid off. It’s a double edged sword.
#7 by Jezebeau on February 12th, 2009
Lum, Godwin’s Law refers to comparisons to Hitler or Nazis. Gevlon referenced the Nuremburg Trials to state the legal perspective on a theory of behavioural psychology. You compared him to war criminals. Your foul.
#8 by The Claw on February 12th, 2009
“Your foul.”
Given that Gevlon’s entire schtick is carrying on about how misanthropic he is, because high school and college kids think that’s KEWL, he doesn’t have a huge amount of high moral ground to stand on when he gets compared to the greatest misanthropes of our time.
#9 by Gevlon on February 13th, 2009
Dear Lum,
I guess you have a problem. You think that you and your friends are somehow better than those people who “wear name tags and hair nets”.
You are not. And the world will remind you again and again to that obvious fact.
Thanks to you, I understand now why does layoffs break people. It’s not the loss of income, after all we all have savings enough for at least half year. It’s the loss of self-esteem. One day you *thought* that you are a respected member of a team, next day you are an “unemployed nobody”.
I was fired and will be fired (especially if I write comments to blogs in work like I do now). However it did not affected me, because I lost only an income.
Despite my PHD, I don’t think I’m better man than a farmer or a kitchen-hand. I don’t deserve special treatment, I don’t have VIP privileges. I sell my workforce like they do. My workforce is maybe more valueable, so I get more for it than a kitchen-hand. However if my work is not needed, I’ll be fired, and I’ll take it as a normal part of life. I’m sure I’ll get a new job quick as I always did.
#10 by IainC on February 13th, 2009
Dear Gevlon.
You still don’t get it.
#11 by JuJutsu on February 13th, 2009
“Why are you comparing an MMOG fee to a salary? Do you practice regularly to be that stupid, or is it an inborn talent?”
Let me get this straight, you think that because company #1 is willing to pay someone a 65K that company #2 should also pay that someone a 65k salary…that all companies should be willing to pay that someone 65k?
What do you do for a living when you’re not being a fool on the internet?
I’m going to type very slow so you’ll maybe understand. I made a parallel to your argument. Just as some people value game #1 more than game #2 and are willing to pay more, some companies will value an employee more than other companies.
I’ll give you an example so maybe you’ll comprehend. Let’s say that JuJutsu is going to school learning how to write software. While he’s in school he’s working at a pharmacy helping with stock and running the cash register. He graduates and gets an offer from a software company for 3 times the money. You think the pharmacy should match it even though it doesn’t need anyone to develop software? Oh right, you do because your a fracking retard.
#12 by JuJutsu on February 13th, 2009
@Veritas
“Going back to the original argument of when an “asset” leaves a company to make more money elsewhere — this really only happens if a company refuses to pay someone what they think they’re worth, and another company agrees that the person IS worth that much.”
I agree.
#13 by J M Grey on February 13th, 2009
I totally agree with your assessments here; your logos matches your pathos here rhetorically, unlike Gevlon who is clearly missing both.
Regarding the part about the Judenrat: it was 70 years ago. At least, I’m fairly sure Golmulka’s Poland was liberal enough to abandon Nazi practices come 1959.
#14 by yunk on February 13th, 2009
“Let me get this straight, you think that because company #1 is willing to pay someone a 65K that company #2 should also pay that someone a 65k salary…that all companies should be willing to pay that someone 65k?”
Yes and your little metaphor is so completely flawed you don’t understand what he’s saying. If a company needs a box boy they won’t hire a developer at all, they won’t make a developer an offer but for less money.
Just as if a company is only interested in part of my experience they would offer me a lower salary, but the truth is they would not make me an offer in the first place – they’d say I’m overqualified and hire someone who has only the experience they need that would take the offer and be happy.
People don’t go out and take jobs for lower salaries, and companies don’t make offers to people for lower salaries than they are making. If the person is worth more in the market then they are worth more in the market, regardless of whether they are worth more to you or not. When the person is worth more than you can or want to pay, then they will leave as soon as they figure it out. So you’d better pay them what the MARKET says they are worth, not what YOU think they are worth, if you want to keep them, or else lay them off and hire someone worth less but that matches your needs.
#15 by yunk on February 13th, 2009
@Rog this “Pinhead Public Company Management 101″ hasn’t been around forever
I figure it’s been around since Frederick Taylor at least. For awhile the Japanese oddly enough seemed to break that pattern.
If you strip out the (seeming) self righteousness the Goblin/Gevlon’s advice is very sound: take as much charge of your life as you can. Notice the warning signs and start looking for a new job if you can’t change yours. Have an emergency fund for the unexpected, etc. I was looking already when I got laid off last year, but I had my emergency fund and was not even worried about my future. The thing is there is only so much you can do.
I stopped leaving companies because of idiotic management, because I’d end up in yet another company with the same problem. At small companies it still happens since often they have no policies or procedures or professionalism – they are usually organized via “hero culture”. In a larger company you can convince your own manager that we should do things differently but often that doesn’t mean anything. And quite frankly I don’t want to go into management to deal with those issues – I’m a technical person.
But there’s a way to say things and a way not to say them, which I think is the problem he is having.
#16 by Mark on February 13th, 2009
Many issues involved in this – but a lot can be tracked back to the bean-counters of the 1970’s who decided that companies could save money by shifting from retirement plans to 401-K’s, IRA’s, etc. That put into motion a lot of things, and really reshaped dynamics of “company loyalty”. On the cusp of the Y2K issue, job-hopping amongst programmers was a daily occurrence – at one point the average time for programmers in a company was six months. I know my personal sentiment as a consequence of all of this has to become extremely mercenary in my work, but not always on matters of pay. Leastwise, there has been little or no basis for the better part of 3-4 decades to depend upon ANY company to be there for you when times get rough.
I live outside the United States, but know that it is a very rough climate there. If it’s rough in the United States, it is very rough outside of it. Greece went through month-long riots, Iceland went bankrupt and had riots. There are riots in Russia, worker strikes in England. Impossible to paint a pretty picture anywhere and every indication is that things will get worse – some are estimating that EU banks have $24 Trillion in toxic debt and that the politics of the matter could bring the EU to dissolve.
Not to be a doomsayer, just saying what is going on outside of the US. In normal circumstances, companies with the money would be buying the companies without it. Not so under the government plans. We are rewarding incompetence and unethical practices of bad people/companies with the money from taxpayers and good/ethical people/companies.
Defending EA/Mythic is not my job, but I think it is appropriate to point out that their making hard decisions and taking actions to avoid the fate of companies like Leyman Brothers is reasonable and justified. Someone is doing their job at EA/Mythic – whether popular or not. At many companies, people were not doing their jobs. They went from “we’re doing perfectly fine, no cause for worry” – to “Help, if we don’t get a few BILLION dollars…the entire market will crash!” – almost overnight. No one questioned or took decisive action when the problem was a mere $500 million?
So…as a taxpayer, who would you reward with your investment dollars? The consolation is that your tax dollars won’t be going to help Electronic Arts.
#17 by Robin Kestrel on February 13th, 2009
Who would have guessed that an amoral self-centered catasser would have such a childlike-view of the employer-employee relationship?
It would be great if reality worked like Gevlon thinks it does and employers treated employees exactly like they do any other article of capital, but that’s not how it goes above a ceratin professional level, as Lum and others keep gently pointing out.
An employer would not expect a truck to travel x more miles without putting y more gallons of gas in it, but routinely expects employees to perform x more effort without receiving y more dollars compensation.
An employer would not expect a fax machine to permanently replace a photocopier (hey, both can make copies, right?), but routinely expects employees to absorb the duties of other employees who are not replaced, without a loss of productivity, of course.
The idea that employees are interchangeable machines who can be turned on and off at will and powered solely with a salary is so beyond the pale I don’t even think Dilbert’s pointy-haired boss swallows it. Even a totaly incompentent employer recognizes that, beyond the “do you want fries with that?” level, there is more to retaining good people and getting good work out of them then putting them in a slot and handing them a paycheck.
On the flip side of that, an employee who’s only apparent concern is his own bottom line is not going to get far, either. Said employee will probably end up with a toxic resume and lot of time on his hands to play WoW.
#18 by JuJutsu on February 13th, 2009
@yunk
“If the person is worth more in the market then they are worth more in the market, regardless of whether they are worth more to you or not.”
Umm ok. The fact that they are worth more to some other employer still doesn’t make them worth any more to me. An employee can have different value to different employers…I get that but apparently it’s beyond soulflame’s grasp. His question was “Why weren’t you paying them 65k in the first place? The answer is simple: just because he’s worth 65k to someone else, doesn’t mean he’s worth 65k to me.
“When the person is worth more than you can or want to pay, then they will leave as soon as they figure it out.”
umm yes.
“So you’d better pay them what the MARKET says they are worth, not what YOU think they are worth, if you want to keep them, or else lay them off and hire someone worth less but that matches your needs.”
No, I pay them what they are worth TO ME. Period. If someone else is willing to pay them more then they can leave.
I’m sorry you don’t care for my metaphor. If you give me the quote where I suggested in any way that companies would try to hire developers for lower salaries to fill the job of a boxboy or anything like that I’ll make a more specific apology. If you have a better example of an employee with different value to different employers post it and I’ll use it instead.
#19 by Iconic on February 14th, 2009
JuJutsu has it right, and I think it’s interesting that any one is even going to argue it, because that’s BASIC micro economics: marginal cost vs marginal profit. When the cost of hiring (or continuing to employ) an employee exceeds the profit they’re earning for you, then you let them go. It doesn’t matter what some one else is willing the pay them, only what they will work for, what they can produce, and whether that makes sense for YOU.
#20 by Verilazic on February 16th, 2009
Love the writing, as usual. Just thought I’d recommend a book to scan through sometime if you drop by a bookstore: The Speed of Trust. Currently finishing it, and it seems like it might speak directly to this little issue. Well, more like, it would speak directly to Gevlon. I’d recommend it to him, but I think there’s better luck in preaching to the choir this time. =/
#21 by SumDumGuy on February 16th, 2009
@JuJutsu
The basic flaw with your analogy is that there is a salary point at which you won’t find qualified candidates. Let’s say that an employee with a certain skillset is only worth $25k/year for you, but the general salary for people with those skills is going for about $75k/year. Why in the world would someone want to work for such a meager salary?
Oh wait – I guess I just described why some of the big Tech companies want to increase the annual amount of h1b visas. Apparently there are some folks willing to do so.
#22 by JuJutsu on February 16th, 2009
@SumDumGuy
The h1b visas are one alternative, people without any kind of documentation are another. I take your point, if the potential employee is only worth 25K to me and 75k to many other employees I’m screwed. The answer isn’t to pay them 75k though, it’s time to redo the business or find a new line of business.
#23 by Iconic on February 16th, 2009
“@JuJutsu
The basic flaw with your analogy is that there is a salary point at which you won’t find qualified candidates. Let’s say that an employee with a certain skillset is only worth $25k/year for you, but the general salary for people with those skills is going for about $75k/year.”
If your business depends on cheap labor that’s not available then your business is not viable. THat doesn’t mean you pretend your business is viable and spend more than you can afford.
#24 by Brask Mumei on February 17th, 2009
The answer may to also rethink how honest you were being with yourself when you thought they were worth only $25k. Trying to calculate ROI per employee is a black art at best. While you might only see $25k in direct profit or savings by hiring the employee (In which case, incidentally, you can’t afford a $25k employee anyways since the overhead is much higher than that, but I’ll join the conflation of employee paycheque with employer costs as it does simplify things), presumably the developer is also enabling other aspects of your business. Sort of like how your lawyer has a negative ROI, but you can’t run your business without one, so you subsidize the cost with other profitable parts of your business.
#25 by Iconic on February 18th, 2009
“Sort of like how your lawyer has a negative ROI, but you can’t run your business without one, so you subsidize the cost with other profitable parts of your business.”
The lawyer has a value. His value is the expected cost in legal fees and fines that you avoid by employing him.
Like anything else in business, calculating that value is tricky because of the entire premise that you, the decision maker, can make reasonable predictions about future possibilities. Obviously not every executive has that ability. Some have even argued that the entire premise is futile, and that virtually all business planning is the equivalent of putting your money on red and spinning the wheel.