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Technology Rewriting the Rules of Business
theStorminMormon writes "Fortune magazine is running a story describing the overthrow of Jack Welch's old rules of business. (Welch responds here.) Although the article lists Google and Apple as two paragons of the new rules of business, it fails to note that the old rules of business originated from straight manufacturing firms while the new rules of business are coming from the (more service-oriented) tech sector." From the article: "Steve Jobs has emphasized that Apple hires only people who are passionate about what they do (something that, to be fair, Welch also talked about). At Genentech, CEO Art Levinson says he actually screens out job applicants who ask too many questions about titles and options, because he wants only people who are driven to make drugs that help patients fight cancer."
If you are passionate about what you do, you'll get out of bed in the morning and actually look forward to going to work. Passion also drives you to do your best, not to just get by so you can collect a paycheck.
If "disco" means "I learn" in Latin, does "discothèque" mean "I learn technology"?
I work to live not live to work. I will do my job to the fullest, but I want a life. I don't want to wake up when I'm old and find that I'm alone and regretting that I didn't live my life instead of wasting it in the office.
I surely hope they have other methods of screening applicants, because I think that some people are easily able to fool interviewers and sound passionate.
They are are just waiting to get hired and once they are, they lay back and start making all kinds of demands.
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"Although the article lists Google and Apple as two paragons of the new rules of business, it fails to note that the old rules of business originated from straight manufacturing firms while the new rules of business are coming from the (more service-oriented) tech sector."
Of course the "service sector" revolves around IP and the creation and maintainance of it.* The other kind of "service" is "would you like fries with that", but you can't build much of an economy on that.
*Billions and billions of dollars as compared to the "buggy whip" sector.
just a few people want to play with words to make ideas their own. As he pointed out in his rebuttal a lot of the ideas that are being set out for today are compatible if not part of the ideas he espoused.
I do agree with one item, weed out your worst. It is true. You will come to find that that passionate ones will not be lost in this. I'm in a company which doesn't do this, its a good old boy club. As such we still make money but never really move forward. We have so much deadwood it stifles innovation. The only time things change is when someone dies or retires.
* Winners compare their achievements to their goals, losers compare theirs to that of others.
Whenever I hear the phrase "passionate about what you do" I get this eery feeling that they're going to offer up far more "passion" in their compensation package than "salary". Passion is all and well, and enjoying work is naturally important, but a large number of employers (especially in tech sectors) love to use the "passion" card as a way of underpaying their staff. If employees ever complain about meagre wages the employer can always counter with "But you LOVE this work! You should be glad to be doing this for a living!"
There's a fine line between passion and simple exploitation of that passion to get stuff done for cheap. And I don't trust most businessmen to look out for my best interests when cutting a deal.
I work to live not live to work. I will do my job to the fullest, but I want a life. I don't want to wake up when I'm old and find that I'm alone and regretting that I didn't live my life instead of wasting it in the office.
If your mission in life is best accomplished at the office, then how can spending your time there be a waste? If you are genuinely afraid that, when you are old, you will regret the time you spent at work, then maybe you chose your career poorly.
Many or even most people choose their career poorly. Sometimes this is avoidable. Sometimes it is not. Sometimes the best occupation is one that pays poorly or not at all. Too many don't even try. They just chase the money instead. But those who do manage to unify their passion with their career are more effective employees.
How dare someone be interested in their own benefits!?!?!
Some of you are confusing passion with obsession. A passionate employee loves his or her job and strives to do a good job - they don't necessarily devote their entire life to it. I know plenty of passionate people who have lives outside of the office. You can really love your job and try really hard without even taking it out of the office.
In my experience some of the people who are obsessed with their job (spending nights / weekends) actually hate it.
Does anyone else see a creepy Apple vs. Microsoft comparison here? I know a couple of managers at Microsoft, and the "old" rules sound exactly like what they do.
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Well they can say what they want but, in my experience, the corporate sector thrives on mediocrity. Most companies want to hire average people and pay them an average amount of money, or a bit less if they can get away with it. I don't claim that this is necessarily wrong, just hypocritical.
They can go on about "passion" and wanting "the best people" but they know that passionate people can be difficult to deal with and the best people not only want the best money and benefits but they want some say in how things get done.
And would they hire someone "passionate" in their late forties or is this merely another codeword for "naive new graduate"?
Ame
Apple on the other hand is so clearly old line. Make quality and useful products targeted to an audience willing to pay for the products. Charge enough for the product to create a good profit. Give good service before, during, and after the sale. Charge enough so that at the end one has enough to pay for fixed costs, manufactureing, service, overhead, and research and development. Do not be afraid to change the product to meet demands, and throw in a bit of flash. This probably had not changed since Ford innovated the car in on color Black, with evolved into the mustang of many colors. I think the old Ford put some big dogs out of bussiness as well.
I understand what the article is saying, but the article is talking about established firm. Apple, as an established firm, did exactly what it was supposed to do. That is fixed itself. Apple has been, and is, a major manufacturer of consumer and proffesional intergrated computer solution. So is Dell. MS only supplies software. Apple is and will continue to be, at least in the near future, a to manufacuturer of high tech solutions. The have proven that they will adjust to meet new needs, just as old bussiness says they should. The article cites IBM, which also did what it needed to do. Refocus on the customer, develop customer oriented products that provided real value. They talk about how the iPod is unique, but how many new catagories of product did IBM help create? The selectric, the PC, SQL, GML, etc.
It is ludicrous to think that anything other than good products or services matter, or that creating new products is something new. IBM exists because it started creating products and focused on customers.
As far as google, that is a story yet to be wrote. They have an Enron like grasp on the ad market, unregulated, not transparent, unpredicatable. The success may be last remant of the dot com boom, or they may be able to leverage advertisers in the same way that TV did. If they are succesful, it will be nothing but bussiness as usual. Create a product, namely adwords, charge enough for it to generate a profit, and use some of the cash to innovate.
I think what happened, especially in the 70's and 80's, was the sense of entitlement of the big corporations. That somehow Americans were obligated to purchase the products no matter how horrible they were. In a perverse way, they were applying the soviet model to capitalism, where the people had to buy what they state supplied, except in out case capatilism provided such an oversupply that we had the illusion of choice. This was illustated with the government bailout of chrysler. In fact, some of the few comapnies that haven't leared thier lesson are in the auto industry. Chrsyler has so given up and is running ads featuring it German owner. In the end what we may be seeing is not new rules of bussiness, but the return to the basics. Make a product, sell a product at a fair price, and realize the consumer is the boss.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
The grass is only greener, if you don't take care of your own lawn.
When I read his rebuttal:
When has there ever been a divergence between shareholders and customers? No one is out saying, "Let's screw this customer today, and if we do, our share price might go up 20 cents." They're just not doing it.
I thought "Well he's obviously never bought a Sony product"...
For the vast majority of coders, business pays their salary.
That being said, I agree that this is an article for suits (well, what do you expect from Fortune) and it's packed with business jargon that means very little. A lot of non-tech types make fun of techie jargon, but the jargon means something; when we say "TCP/IP," it's because it's a lot quicker than saying "transmission control protocol and internet protocol," and a whole lot quicker than spelling out, in detail, what each of those terms actually means. Suits have long had a habit of either taking technical jargon (from various fields, not just CS) and twisting it until it doesn't mean anything, or just making up jargon that didn't mean anything in the first place.
"Six sigma," mentioned in the article, is a fine example of this. How many suits really understand what a "sigma" is in this (or any) context, or why six of them is an interesting quantity? Then the six-sigma crowd compounded their sins by using the phrase "black belt." And of course there's all the military talk they love to throw around, this bunch of lifelong civilians who wouldn't know which end of an M16 the bullet comes out of. As a mathematician, a martial artist, and a veteran, I find this particular combination to be the Holy Trinity of bad suit-speak.
So the answer to the question, "Why should we care?" is, "Because that's where the money is" -- but that shouldn't keep us from pointing out what a bunch of jackasses they are.
The correlation between ignorance of statistics and using "correlation is not causation" as an argument is close to 1.
See, i disagree. If you got into IT for creativity, you should have looked into marketing. IT is about standards, best practices, and things 'just working' for your customers (ie the company's internal people). Yes, there are places where creativity is good, but no more than any other 'office job' at the same company.
Lets see, i need a fool-proof disaster recovery scheme. Best practices or art? I choose best practices. File server? Yep, best practicies. Email? Exchange, please.
Like i said, there is room for creativity, but only here and there. IT is not alchemy by any stretch.
Han shot first.
With regard to hiring. . . After a company reaches a certain level of success and public recognition, large numbers of people start applying for jobs just because they want to work for a successful company -- not because they want to help make the company successful. In other words, they want to ride the gravy train. Those are the ones you have to weed out.
Start-ups and small companies rarely have this problem. It's after your company turns out to be Google, then everybody wants to climb on board.
In your example Bob IS the passionate person. From the factors the manager listed there is no way he hates his job and can write top code and work well with everybody. Being passionate about what you do isn't about saying how much you love it, its about waking up in the morning and WANTING to go to work and get stuff accomplished.
;P
The manager you imagined is just an example of a bad manager, and not how I imagine hiring passionate employees at all. I would imagine the manager hiring Bob and hearing Bob talk with enthusiasm about all the ideas he has to implement. Hed probably pass over the cookie cutter from Nabisco
"how can they call it a MINE if everything here is THEIRS?!?!" -Straight Jacket
Sure, you believe ... it's easy to believe.
Where's the benchmark for "passion"? How do I prove I have it? How does a manager evaluate me for it? If Dave was hired because of his passion, and Bob was hired because of his passion, which one gets to head up the project? Which one has more passion and which could work on his passion a little bit?
For that matter, is it even possible to "work on" your passion? If you were hired with just a little less passion than Dave, is there some kind of program or training course the company can offer you that will increase your passion levels? Or are you just doomed to not succeed because, hell, it's about hiring the most passionate people you can find?
This is what I mean by touchy-feely management. Yes, in today's more compassionate America, nobody wants to look like a bully. God forbid we should be competitive, or aggressive, or challenge ourselves and our coworkers to do better work even if we're working on something that we're maybe not all that passionate about. But come on -- do you really want to work for a company whose mantra is "Admire us for our soul?" I feel oily just thinking about it.
I'd much rather work for Jack Welch than the people who wrote this list of tips. Jack's world may not be the most forgiving one, but at least he doesn't mince words with this kind of New Age garbage. At least he shoots straight.
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I think that you basic 'problem' is with the word 'passion', and I'll agree that it is just about the vaguest 'concept word', and open to interpretation. Grading someone an 'A', 'B', 'C', etc, is also highly subjective as well. Jack and his team picked, promoted, and nurtured some pretty good people, but others who have superficially implemented 'his style' have not been so successful. Articles like this are good for self-examination, and should not be used as a manifesto. Of course someone will use it as such, and will likely miss the meaning altogether, surely even resulting in yet another example of your complaint. I wonder how many good coders were rated a 'B' because they lacked 'managerial' qualities.
And I also believe that using one's moderating term of speech against them is rude. Particularly without a smileyThe grass is only greener, if you don't take care of your own lawn.
If there were, you'd hear a fuck of a lot less of that.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
This keeps getting repeated. "Old way is inferior to the new way." With the new way always being a more laid back, less money oriented approach.
I have news for that will just shock the world. Companies like Google and Apple are run just like every other company. People are hired for what they can do, and are let go for not living up to their potential. CEOs do what makes them more money. The only difference, is the that "new way" hides their intent behind an "employee friendly facade." How can Apple be part of the new way when Jobs is notorious for being the typical power hungry boss who will ridicule you in front of your coworkers? How is that the "new way"?
Google and Apple are not some awesome place where everyone just relaxes all day being "creative" and yet somehow still make money. At both companies, goals are set and if they are met people get in trouble or even fired. Just like at every other company. These companies also live and die by their stock value. Who was that bough an oversized company jet and decided to refit it? Was that some greedy boss at Bellsouth or Enron? Nope, it was the good natured guys at Google who don't care about money, right?
I worked twice for GE as a contractor and I can tell you having a 'A' there has nothing to do with talent, but more with 'visibility', in other word, powerpoint and buzzwords.
The main rule is to remember what a business exists for. And that is not "to make money." Within three weeks of starting b-school we were being told that that was the route to disaster, because although that may be why people invest money or labour in the company, that is their reason, not the company.
The real purpose of a company is satisfy the wants and/or needs of a market segment at a price that the market segment is willing to pay. If you can do this and turn a profit, the company will continue. The market (And here, I mean the customer base, not the stock market.) does not care if you are making a profit. It does not care that your shareholders want ever-increasing profitability.
One of the thing about the "old rules" in the article is its emphasis on the stock price. This is to take your eye off of your market, and I contend that this is the major cause of most of the septic corporate behaviour in the world today.
In fairness to the CEOs, the market and thus the boards of directors insist on this devotion to share price. From the article: "Never before has a CEO more needed to take risks, but rarely has Wall Street been less receptive. A recent Booz Allen study found that a CEO is vulnerable to ouster if his stock price has lagged behind the S&P 500 by an average of 2 percent since he took the top job." (God forbid we should take a momentary hit is stock price because we are developing a new market.) "Cisco Systems CEO John Chambers says he knows a number of colleagues who are planning to step down because of the difficulty of balancing the shortterm pressures of the Street with what's in the longterm best interest of the company."
Despite what many people think about the "intelligence" of the stock market, the function of investment funds is only to make money. There is no incentive in the stock market to take the long view.
In the book "Up the Organization", the author, Robert Townsend, relates that when he was hired to be the CEO of Avis, he insisted on one condition: "Don't talk to me about the stock price for two years!" He didn't want to be distracted from the long term goals by worrying about the vagaries of the stock market. I have alwys thought Mr Townsend to be a very smart man.