My friend and I were world-competitive at Daytona USA, a SEGA racing game. We were a team whenever anyone else would race against us. Otherwise, we were extremely competitive against each other. However, when we would be done with a racing session, we would deconstruct and disclose our racing with each other. If one of us discovered a new technique for, say, dealing with a particular corner, we shared it with the other. (We also occasionally shared with a broader group, who repaid the favor.)
It's not competition that is the problem. It's score-keeping and secrets. Our competition against each other allowed us to have fun and push ourselves to the point where we took our skills as far as was possible.
A key component of this is that we gave credit where credit was due. My friend didn't get credit for beating me, but for sharing with me the secret of my defeat; and vice versa. Once again on equal footing, we credited each other not with knowledge, but with the skill to apply the knowledge.
That experience has guided me in my life. Sure, in an unhealthy organization people can take advantage and not get back. But healthy competition has paid off more than it's cost me, and I've always thought life was too short to be in any unhealthy relationship, even with employers or coworkers.
> If one of us discovered a new technique for, say, dealing with a particular corner, we shared it with the other.
What is your incentive to do that? I see that as the key. In a company, employees needs an incentive to work together and be constructive. They are not friends.
If you do not get that incentives, if your department success means less budged for mine, if my colleague success puts my job at risk, if your project success creates a problem for mine, I will not be motivated to collaborate.
If you create that incentive of collaboration then the "challenge" factor will be there. I have worked in great teams where we were evaluated as a company, where bonuses were for everybody or no-one. And it was a very competitive environment, I wanted to be as good as any colleague, know as much as they did. And, I wanted them to succeed because it was awesome to see such great projects but also because it was good for myself.
I have not found any healthy company were competition was enforced top-down. Only when collaboration is designed and encouraged top-down then healthy sportsmanship arise from great engineers and teams.
> What is your incentive to do that? I see that as the key. In a company, employees needs an incentive to work together and be constructive. They are not friends.
Remove individual metrics or performance indicators, make team success the important goal. Most of us work in a team of some kind, yet in places like retail sales they often pit employees against eachother with individual budgets instead of store budgets.
If you ever go into a clothing store and wonder why the changerooms look like they haven't been cleaned in weeks, that's probably why. If everyone is trying to meet an individual sales budget no one can afford the time to clean the store since it could cost them a sale. If it doesn't matter who gets the sale as there is only a store budget, they can work together to get all the extra tasks done. One person can clean the change rooms while the other takes sales etc.
When you start tracking a metric there can be all kinds of second order effects, so it's important to pick your metrics and goals wisely.
> Remove individual metrics or performance indicators, make team success the important goal.
This just moves the competitive boundary between teams, rather than individuals. It's not unheard of teams that compete and sabotage each other to make their project the most important and impactful.
The issue with that approach is that incentives are not always aligned. Not everyone is an altruist willing to give up their personal self-interest for the good of the company.
For example, you might have a legacy team whose future headcount growth is negatively impacted by a new team. Whether because this new team is automating tasks of the legacy team, or building a product that will cannibalize sales.
From the perspective of the company, the legacy team should embrace the future and allow themselves to be creatively destroyed.
But in reality, you have some leaders who do not want to give up power and will try to hold on, optimizing for personal incentives.
That's not a problem if the people in the old team understand that their security is tied up with the success of the organisation. I.e. if the new team does well, the organisation does well, and all employees are cared for.
If somehow the people in the old team get into their heads the idea that organisation-wide success stands in conflict with their security, then you have a problem.
But the problem is with management, not the people on the teams.
Edit: in general, it's a common disease in companies to associate people with teams rather than the organisation. People don't become useless because their previous roles are obsoleted. Those are still valuable people and sure, there's a cost to retraining them, but the cost to letting them go (in terms of what it teaches the rest of your employees) is so much greater. (Though unfortunately harder to measure.)
We can thank Jack Welch of GE for that attitude. I thought the same thing in the 80’s when GE was shedding thousands of employees. That those employees should be useable for new endeavors. Turns out retraining is a cost the company can externalize with firings
Each “step” reduces an individual’s power in determining the outcome, and thus their responsibility and commitment. People also know some intuitive game theory; They won’t take an excessive burden for a shared prize, as that will ultimately burn them out in the long run.
Teams don't work in a vacuum and it's not that hard to eventually find the slacker in a team. But you have team goals and individual goals. Team performance management and individual one. This is where good management comes in, to find a way to engage and motivate even a slacker, to get them to deliver at least the same amount of value you put in them.
If the easy things fail (usually the financial or flexibility kind) there are other options. Find them the same position in a different team with different dynamics (a great individual can sink if everyone else on the team is much better, or much worse), find them a different position where they can shine (you can start as a mediocre midfielder and end up a successful goalkeeper), or even have them find a different job entirely.
Recent research shows that financial and other extrinsic motivators actually inhibit performance.
After a worker has achieved a base level of income that makes their life comfortable, any extra treats they receive will decrease their interest in the core function of their work, moving their focus to the extrinsic motivator instead.
I've also heard interpretations of this effect that explain it as: being rewarded can demean the value of work, because it may feel as though the work itself is a chore that nobody would do unless they got rewarded.
In general, I believe that extrinsic motivators lead employees to follow their instincts less and focus on anything that will net them a reward. This means that even if someone has a great idea for improving some aspect of the work a company is doing, it might not get done. They are instead being rewarded for whatever arbitrary KPI that management has decided is important.
In fields where there is a single clear KPI, all processes are mature, management has a clear view of the entire value chain, and workers are focused on a single task that is highly tied to the KPI --- e.g. yields in manufacturing tied to a production line worker --- sure, rewarding high KPI is not a terrible idea (or at least as terrible as it would be otherwise). But whenever a workers focus can be co-opted by bonuses I believe bonuses tied to KPIs are a bad idea.
RE: your second point, I absolutely agree. How well a person "fits" in a team has a high impact on a person's motivation.
It seems I have to qualify "recent", this was already studied in the 70's [1]. But recent material is available as well [2],[3],[4],[6]. [3] provides a view from an economists perspective (incentives), [6] looks at motivation of employees and compares to performance and well-being outcomes.
The psychological question is about intrinsic vs. extrinsic motivation, and has been studied for a long time now, for an overview, see [5] or https://en.wikipedia.org/wiki/Motivation
But you're ignoring the "demotivating" factors. Getting a pay bump might not be a (good) motivator in itself but it may remove a demotivator. So sometime these moves are to release the handbrake rather than make the engine more powerful.
That's correct, that's why I said financial motivators don't matter _after_ you already have a comfortable life (your needs are satisfied). [1] and [6] both argue that rewards that aren't conditioned on performance (e.g. salary) don't detract from intrinsic motivation and that a competitive salary is a good motivator.
> financial motivators don't matter _after_ you already have a comfortable life
Oh, this is a slightly different topic. Of course if your belly is growling money will motivate you a lot, and that motivation tends to go down the more you go past your comfort baseline.
But think of pay disparity for example. Maybe your belly is full but your slacker colleague is making more money than you. That has a good chance of demotivating you, making you ask "why should I try harder?". Reducing this disparity and (perceived) inequity, eliminating the demotivating factor, goes a long way and has a far longer lasting effect than just the same extra money would bring otherwise.
I totally agree, salaries aren't bad, bonuses are.
And pay disparity can be a problem, especially if salary data is hidden. I think most of the time the problem is a lack of openness about salaries and why they are as they are.
Because you don't want to be the one who is dragging down your friends. Because you are proud of providing a first-class service. Because people depend on your effort.
> Remove individual metrics or performance indicators, make team success the important goal.
Why would a high performer stay there? The rest of the team drags him down and there is nothing he can do about it, he will just leave for a position where he doesn't have to pick up the slack of the entire team before he gets acknowledged.
It depends on the specific context of course, but I think there's a fallacy in the assumption that the high performer can perform better than a well working team would. A business is also an organism with many moving parts, if you optimize for just one particular metric and hire high performance individuals based on that, you end up neglecting the other parts of the organisation.
Either way you can make that decision, perhaps your particular business is better off with high performing individuals. Like a door-to-door sales company probably doesn't benefit that much from team dynamics, and you'd definitely get slackers in that context. But a software team more often than not gets impacted negatively by a rockstar billowing out code rather than organizing with the team.
Your incentive is to beat the bigger game, that is, the one that maintains your friendship and keeps the other person playing. If one person is significantly better than the other and wins all the time, the other party will lose interest and will stop playing.
> In a company, employees needs an incentive to work together and be constructive.
I think this is exactly backwards. The overwhelming majority of people I have met in life are by default collaborative and supportive.
What screws this up is the introduction of bad incentives, often unintended ones.
I'm not saying there are no natural incentives to competitiveness etc., but if you artificially introduce more of them it tends to be net negative. Lots of companies do this, even without intending to.
> What is your incentive to do that? I see that as the key. In a company, employees needs an incentive to work together and be constructive. They are not friends.
It all depends on what game you are playing. On one level you can characterize it as zero-sum vs. positive sum, on another level as closed (play once) vs. open ended (keep playing).
When your goal is to keep playing and improving iteratively as a player, it is definitely to the advantage of each player to help their counterpart improve, regardless of who is currently 'winning'.
You can also pose the whole thing as an iterated prisoner's dilemma, where the best overall strategy is tit-for-tat with generosity (default to cooperation as a starting move) and forgiveness (occasionally cooperate even if the other defects).
There are additional iterative loops that could be going on too, like opponent/partner selection even when the game is ostensibly zero-sum (eg. "nobody likes a sore loser"), and finally there is the meta-game of game selection, which can be characterized as 'culture'.
In a business setting the incentive to share your solutions with other teams is the hope/expectation that they'll share theirs.
What good is it if 2 teams are solving the same problems. It's a waste of time when the other team could be solving a different problem. At the end of it you share your solution.
There's too many cases of teams just being walled off from everyone else and then duplicate work being done.
You should be paid enough just for showing up to take money off the table as a concern. If you worry about money, you will not perform at your capacity. You need to be motivated by better things, like sense of accomplishment, the joy of figuring stuff out and solving problems, teamwork, etc.
As a motivator, money is a notch above the whip, of course, but not very good in the grand scheme of things.
The book Drive is very good and discusses the latest evidence around motivation at depth. Obligatory reading for anyone in a leadership like role, in my opinion.
And that book has been a blotch into peoples well being since forever.
Money, no-one shows for work (well almost no-one) if they don't get paid. Everyone I know doesn't give a fuck about a sense of accomplishment. If the choice is 'work for X and get a sense of accomplishment or get 3X without it'. (If I remember correctly) The book's research while valid, leaves out a lot of counter research and selective selects some data over other.
Unless you are curing cancer, give me more money. Want to motivate me? put a 100k bonus at the end of the year. I don't give a fuck about teamwork or to feel accomplished. Money makes the world go around, and that is why I show up for work.
I think I spot several mistakes of reasoning in your comment, but they essentially boil down to this: it sounds like you're too confident in your personal experiences to generalise to humans as a species.
I think -- like you describe -- that many people will go through life only ever motivating their work with money. I think this can happen for any number of reasons, some of which are just personality traits, and that's fine.
In other words, I won't contest your experiences because I fully believe you share them with many other people. However, I also don't think they invalidate the general results that a lot of people could be paid enough in a good enough environment to remove money as a motivator, that would be cheaper for companies, and society would be better off for it.
Maybe you are right, but to be fair, I worked all over Europe in various countries and cultures. Pretty much everyone I worked with in engineering circles would prefer more money over an 'employee of the month' award.
The thing is, when people/self help gurus/whatnot talk about money not bringing happiness and job satisfaction and whatnot, they are using that against you (general you). What is paid enough anyway? If I have 5 kids, and you have none, it will probably be different. Or if your hobby is race cars and for me walking in the park? And the most important is, more money = safer future. If you exclude the FAANGs, most people are underpaid (in the sense of being enough to be happy and safe for the future) and the 75K and money doesn't equal happiness is used against them. It is nothing but owners/managers trying to get the most of the person for the least they can pay (why is taboo to talk about salaries? or you are asked sometimes to not speak of the bonus you got, etc?)
Just assume if a company is trying to 'convince' you for less money (even if you are asking for 500k and they want to offer you 450k 'only) by saying they are good company, teamwork, etc etc, just be sure, 99% of the time the owner/manager wants those 50k for his own bank account/benefit. If money didn't matter, the owners would be super happy to give their profits in forms of higher wages to the employees.
You might be surprised, but I agree with almost all of that.
I want to emphasise that when I talk about motivation higher than money, it is definitely not an employee of the month award. If that is your idea of intrinsic motivation, I can absolutely understand your confusion.
The threshold for how much money is enough money to not be a concern depends on both personal opinions as well as the community around the person, just as you say.
If a company tries to convince me it's worth a pay cut to work there, that's a strong signal they are running an awful environment.
The best places I've worked are the ones where managers say, "If you ever feel economically undervalued, please just ask for a higher salary. It would be so silly to lose you over something we can so easily fix."
When I talk about "money should not be a concern" I really mean that. If they are trying to get you for less money, then clearly money is a concern around there, invalidating everything else about intrinsic motivation.
The reason why so many people are talking past you is almost no one has had a boss that says "just ask for a higher salary" and most bosses act like the king of shit mountain for giving you 1% more than you got last year.
One of the most common pretenses used? Family.
We're a family, we work like a family, everyone here is a family. Wouldn't you work overtime for the family? You should sacrifice for the family. You should die for the family.
I like to imagine that if I felt I had my needs taken care of, I would not care about the money. But because money is linked to things which feel like existential threats like not finding a mate or losing the roof over my head, pursuing it is 'a notch above the whip'.
But what is 'my needs taken care of'? You never have to work a day in your life and will have enough money to maintain your desired style of living?
That is why 'my needs taken care of' issue comes up to me. Yes, 100% of the jobs I worked paid me enough to have a decent life, but if I got fired and couldn't find a job, I would be on the street after a few months. That is why the 75K USD or whatever it was in the book saying it didn't improve happiness is bollocks. You might not starve in SF with 75K, but I assure you an extra 20k would make you much happier, even if not for the peace of mind that you could save it for a rainy day.
If we talk about UBI or millionaires, sure, money stops being a concern, but I also don't see a lot of millionaires going over job boards trying to find a job that gives them a sense of accomplishment. They are doing their own things to achieve that happiness, and I doubt is working for someone else (some exceptions of course)
Not to be facetious, but I referred to the feeling of having my needs taken care of because I know that I often am not a rational actor. If all we did was forage for nuts and shared them because we felt that everybody did their part, I would probably be very happy sharing those communal meals. When someone drives by in a huge yacht spewing diesel fumes and soot, the enjoyment I got from our humble communal meals is easily vanquished. The meal did not change in any appreciable way, but understanding that a huge amount of the resources we need to survive is wasted on an outsider's frivolous amusement leads to discontentment.
In practice, the worst extreme of this dynamic seems to be the use of pale-skinned models for advertising in areas where people have dark skin. The reasoning might be as simple as pale skin showing up brighter in print, but the outcome is otherwise perfectly healthy people getting body dysphoria.
I rarely want to do something someone else tells me to do. I have my own dreams and ambitions.
The only reason I work for others is money. Money is a path to freedom.
It doesn't help that half of the forces in our industry are concerned with accruing power at the expense of individuals. I want nothing to do with that sort of thing.
I'm not sure what your comment means. Yes, there's a whole philosophical debate of what is value and does it make sense to sell your labour at all. That's not what I meant.
All I said is that if you instruct people to do a job and tell them "Every time your work is of excellent quality, you will get a temporary increase in payment, and every time it is of bad quality, you will get a temporary decrease in payment", on average, one of three things will happen:
1. The quality of their work stays the same. (For example because the environment is not set up such that it's in their power to do a better job, or you're measuring quality on a different dimension than is relevant to this person.)
2. The quality of their work declines. (For example because they don't agree with the exchange rate you're offering on money-for-quality.)
3. They find a way to cheat the system to make it look like the quality of their work improves even though it does not. (Because you have made money rather than quality the goal to chase after.)
You'll note that the desired outcome just isn't there. This is for many diverse reasons in different circumstances and the book I mentioned goes into each.
If instead you instruct people to do a job and create an environment in which they can feel proud over good work, in which they can fulfill themselves, and be a valued and active part of something bigger, you'll on average see one outcome:
1. The quality of their work improves. (Because that's the only way for them to trigger their internal reward circuits.)
Well, not quite. It takes one more thing: in order for the quality of their work to improve, they must feel secure, both physically, and fiscally. If you threaten them with the whip, or there's not enough money to make their ends comfortably meet, the quality of their work won't improve.
Also it's very well known that most people are willing to accept salaries below market rates to work on topics/goal/environments they really care about.
Equally, many work in ethically controversial organizations because of higher salaries.
The modern engineer treats their salary as a birthright, worried only that it is not large enough to justify their true best efforts.
But seriously, the psychology of worker incentives has been studied. Things like employee of the month and yearly bonuses exist because salary alone did less. You compete internally to be promoted, recognised as a top mind, paid more. These things are to your direct advantage.
Obviously at a small startup you want it to not go bust. Your incentive for getting paid next month is real. Once you are at facebook, well it is going to keep paying you. You don't have tangible real impact on company outcome. So you start optimising yours
> Things like employee of the month and yearly bonuses exist
I thought they existed because it's cheaper to hand out worthless certificates and occasional one-off payments than actually increase employees' wages. Which is why "employee of the month" and other non-monetary rewards are popular minimum/low wage workplaces.
Agreed from me. I would be surprised if these things didn't exist before research into them happened. And then I would be further surprised if the research want just a post hoc justification of the idea.
I wouldn't be shocked to find out I am wrong. Just surprised.
If I get paid more if your project fails because there is more budged for my project. My motivation is against collaboration.
I do it for the money. And the company, thru forcing me to compete with my colleagues for budged, and bonuses, gives me an incentive to not help, or in the worse case scenario, to sabotage their work.
And managers cannot do much about it if there is a strong economic incentive to be hostile to your colleagues.
Only if more pay follows teamwork and constructive work. In many places it does not.
For example, say that there is one team lead position available. It probably pays more. My incentive as an employee is do what it takes to get that position even if it damages my company.
> It's not competition that is the problem. It's score-keeping and secrets.
IMO the healthy interpersonal dynamic between you and your friend will not scale beyond say 10 people. That is the problem.
No matter how well managed an organisation is internal competitions turn vicious in no time and drain the company of its precious resources. Co-operation must be constantly fostered from the top management and the first sign of competition must be dealt with. In today's age of promotion-driven-development it isn't easy. Everyone wants to build the new and shiny service.
I think you are self-contradicting yourself here. "No matter how well managed an organisation is" versus "Co-operation must be constantly fostered from the top management".
You're basically saying "this can't be fixed by management" and then saying "it must be fixed by management".
I'm probably just misunderstanding you. Could you clarify?
FWIW, in the organization I'm working at, I don't have that problem. There are literally hundreds of other sw engineers that could do exactly my job, and we all have the same title, and collaboration works really well between everybody. There are some personal differences here and there, but the overall environment is excellent and we don't compete internally. We try to learn from each other and push each other forward.
You are right, I expressed that poorly. I wanted to disagree with the GP's following assertion.
> in an unhealthy organization people can take advantage and not get back.
I interpreted it as "unhealthy competition is a result of unhealthy organisation". My take is internal competition is a big reason that results in unhealthy organisation. The point I wanted to make was if the management is not careful to snuff out competition at early stages it'll get bad and that the upper management must constantly foster co-operation, not just by talking about it but by showing it in action. For instance if leaf level workers see that there are two VPs with overlapping charters who are sort of having a rift then they will copy their behaviour.
And in your org it's clear that co-operation is being fostered, a great example is everyone having the same title. It's a terrific way to show to everyone that the management means what they say.
A racing game has clear criteria for who is better.
Software development does not even have clear criteria for when a project is done (for us, it's typically when the customer stops threatening legal action on a weekly basis).
Internal "competition" absolutely makes no sense for the 90% of SW shops that do not have infinite SV money.
>> However, when we would be done with a racing session, we would deconstruct and disclose our racing with each other.
That is one of the things I miss most about racing, during the race the horns did come out and the competition was tough, before and after we did help each other and enjoyed spending time with others having the same hobby. Nothing like having a laugh while helping someone you crashed into fix their car to get it ready for the next heat
One of my favorite books is Slack, and I have this quote highlighted: "There is no such thing as healthy competition within a knowledge organization; all internal competition is destructive."
One anecdote I faced once was talking to a senior engineer at a FAANG company who was complaining that he just discovered another organization building the identical product his team had spent over a year on, saying that management was so disorganized it must have not realized it. A couple weeks later I happened to talk to a VP up his chain of command, and mentioned this to him, and he chuckled and said "oh yeah that's by design, I'd rather have internal competition than external, it's worth the cost". Was a good reminder for me to avoid large companies.
> A couple weeks later I happened to talk to a VP up his chain of command, and mentioned this to him, and he chuckled and said "oh yeah that's by design, I'd rather have internal competition than external, it's worth the cost". Was a good reminder for me to avoid large companies.
Rather than just outright dismissing what he said without any justification, did you consider that he actually had evidence/experience that it indeed did reduce the cost? In terms of risk in particular, having two teams work on the same product significantly reduces the chance of not having a viable product by the deadline. Assuming e.g. a 50% chance of failure, having two teams reduces this chance to 25%.
That's the cold number's game. But that excludes a lot of factors which the original article is about. The moment you have internal competition, you build conflicts and distrust. The fallout on both teams may be much worse, in the long run.
Maybe you get this one project out the door, one team wins, the other one loses. Great. And then what? Half the other team quits since they didn't get that bonus and feel betrayed by management. The other half stays, but resents both management and the "winning" team. Now you reshuffle, and those guys have to work with each other. Start the game anew, with a new project? Great, now people know what's up and will play their cards accordingly. Infighting is guaranteed. That's a terrible way to manage teams. Short-term gain? Maybe. Long-term destruction? Basically guaranteed.
The "without any justification" part of your answer dismisses that that's exactly what the original article is about that we are discussing here. That alone is justification and it matches many people's experience.
I'm personally experiencing the exact opposite these days. I'm thriving on my company not doing this nonsense and we are doing fantastic!
>The fallout on both teams may be much worse, in the long run.
The key thing is that nobody's presented any evidence, just some anecdotes. Clearly there are places that have internal competition and have done quite well, like Amazon (compared to e.g. GCP), or many trading firms.
I so far haven't heard an anecdote from somebody claiming "I experienced internal competition and it was sooo great!".
It's anecdotes from people having experienced anxiety, toxicity and overall bad work climate leading them to either quit or seriously consider it themselves or hearing it from their colleagues.
And it's other anecdotes saying "some companies have done quite well".
I personally have experienced it and I won't go back. And I have also personally experienced the opposite and now I'm having a blast without this nonsense.
But sure, let's just say "nobody has evidence, maybe it's great, maybe it's not".
Then you didn't read well. User tovej presented pretty good arguments about intrinsic vs extrinsic motivators, including a bunch of cited studies.
Your argument that Amazon does great does not provide evidence. Maybe they's do even better without this crap, or maybe the employees would be happier.
> Assuming e.g. a 50% chance of failure, having two teams reduces this chance to 25%.
...if failure is independent, sure. Not only is independence generally a dangerous assumption, but in particular when it comes to software engineering, it's been shown that problems are not independent. I don't have the reference at hand, but if I did, I could show you that completely separate teams tend to make the same mistakes.
This makes sense. Both teams must work with the same organisational rules, the same infrastructure, the same 'enterprise' technology strategy, often the same geographic constraints, the same marketing organisation, the same customer preconceptions about the company, etc, etc.
Nono it doesn’t make sense. What are the chances that both 50% failure chances of both teams overlap on 49% of each other? Bad luck! but it is rarely random: Start at the wrong time of the economic cycle for example. Also what are the chances each team poaches resources that the other needs? Then you increase failure rate to 75%…
and if the product's market only allows for say 2-3 dominant actors, the lack of focus might even mean that you lowered your chances of success quite a bit. just look at Google's multitude of misc chat and meeting solutions.
That's not how risk management works, and it's also not how costs work. You're (more or less) doubling costs, but the biggest risk factors may be outside the control of both teams.
The opportunity cost is the productivity of an entire team of developers who might well be better employed doing something useful.
>That's not how risk management works, and it's also not how costs work.
It's how it works in a lot of successful trading firms; Jump Tower and Citadel for instance have competing internal teams. Reduces the risk to the firm because if one team's approach fails, chances are another will still be doing okay.
I'd think sharing the plan of building two versions of the same thing and tasking the teams to come up with two distinct implementation strategies would provide a better outcome. This way there's still competition, but of a friendly kind. The risk is further diminished by communication of lessons learned and not having to step on the same rake multiple times.
It destroys at least one team’s morale and increases attrition directly. If a company cares only about results and has a good supply line of employees like for FAANG companies have, it might work. But for most companies, it would only lead to implosion.
Agree on sometimes having good reasons. Not just time to market, but also different approach. As long as in the end only the better one is shipped and the "losing" team is managed well through the decision, it could be a win.
There can be good reasons for redundancy, like you mentioned. I think that not even telling different teams about the others working on the same thing goes a bit far though. Eventually people will find out anyway and then they will feel like management has lied to them. The fallout of that situation will probably more than erase the benefits from having multiple teams.
Yes, that's exactly what it was. Keep them squibbling among each other so they wouldn't get any ideas of disposing of him. At least that's the consensus nowadays. Not sure if there's any proof of his intent.
I remember reading from a Googler somewhere that exactly how Google Pay was built. Several regions were asked to build Google Pay product and finally the version built for India by Singapore team won so Google made that as the default version to everyone. And I guess many from original US Pay team quit or went to other projects or something like that.
> 2 is still pretty good for a lot of things though.
It doesn't stop at 2. When I left Amazon about a decade ago there were at least half a dozen digital money services/products. Each vertical (retail, 3-p retail, Kindle, Gaming etc.,) all had their own stored-value service managing a slightly different version of the same digital money (gift-card, merchant balance, game coins). The feature sets overlapped ~95%. It may well turn out alright for the company but if you are an engineer or manager tasked with building yet another such service it's no fun at all.
"Two is one, and one is none" is a phrase I've heard for critical survival equipment in several contexts. For example two regulators when scuba diving,
two tie-offs when securing gear to a pack,
It's not like they had any systems competing, unless we're talking competition between Boeing and FAA, where one fights for profit by destroying evidence and fudging results, and the other tries to fight for safety (nominally).
P.S. It didn't start with McDonnell-Douglas acquisition - 737MAX is not the first 737 with deadly design failure - the first one was the original one. Except there Boeing also destroyed evidence from wreckages to hide the issue.
I remember reading somewhere that Bill Gates once said that Microsoft would rather pay for developers to do nothing at Microsoft, than having them leave and work for the competition.
If all competition withing an organisation is destructive, is it still destructive if it happens withing parliament? Thats a single organisation that needs to get things done. What about withing a government or a political party?
What about withing a country, is that not an organisation? Organisation is not defined by the payroll department after all
> A couple weeks later I happened to talk to a VP up his chain of command, and mentioned this to him, and he chuckled and said "oh yeah that's by design, I'd rather have internal competition than external, it's worth the cost". Was a good reminder for me to avoid large companies.
I had the exact same interaction with a VPish person. The concern in my tone didn't even register with him. He said, let them all build, and may the best tool/service/library win. There is no such thing as healthy competition; it always tends to get vicious and ends up really badly for one of the teams.
I believe that a management culture where teams and projects had to compete against each other was also one of the causes of the downfall of Nokia’s phone empire.
I suppose from the perspective of those higher up the chain of command, it’s not much different than acquiring competing companies as soon as possible.
If you acquire a competing company, you ideally assimilate the employee work force and integrate them into your organization. You welcome them and make them feel home from day one. At least those that you keep. There are likely a few that you let go. But it's really important not to get hard feelings in there, 2-tier engineering, internal competition. I'd quit immediately any organization that doesn't understand this.
I think it does. I'm not just talking about politics here, though I do think company size and level of politics are correlated. I'm talking about purposefully designed internal competition. That's very rare to see at smaller companies.
I saw a lot of this when I worked at Google, both with internal-facing products and external-facing ones (software, though, not hardware). Organization A would build their own query engine, for example, but then organization B would build their own competing one because A's solution didn't quite work in the ways that they wanted it to. The result, of course, was that now you have a proliferation of query engines, and if you're a neutral party, you just end up being confused about which to pick since they all have tradeoffs, and none of them have sufficient headcount to build out more complete functionality. In terms of external products, there's a long line of competing chat, video calling, payment, etc. solutions, most of which have been killed off by now.
My takeaway was that I wish leadership had thought more critically about how to invest resources across organizations to build fewer but more adaptable products, but I don't think the right incentives existed :/
I’ve never been more motivated to quit than when on the other side of this. The thing that already exists only seems from a distance like it does what I need. It makes different trade offs, it’s poor quality, the team that owns it is far away, and they “agree in principle” with all my proposed changes but “it’s a question of resources.” On smaller projects I have sucked it up, and wow. Something special about tying yourself up in knots to do work you’re ashamed of in the end.
On the bigger projects I’ve always managed to wriggle out, thank god. Usually by building something domain specific so as to avoid the appearance of direct competition. Language and branding are crucial here. If your design doc uses the words “rules engine” half the company perks up. Why aren’t you using ours? On the other hand “configuration” is totally fine.
I'm hopeful that if people were to look at the same data the teams would not have such vastly different ideas about what problem they are trying to solve. I presume that these organizations generate overlapping products because they don't communicate, but shared data is a kind of top-down communication which works even if the teams feel that they can not coordinate.
Generally the existing system is appropriate to the business context it was first built for. The problem is that the owning team would like to claim the “impact” of you reusing their solution in a new domain, while maintaining a “not my problem” disposition towards the unique constraints of your domain, and towards the daily ergonomics of your life in their codebase. What’s needed is a proper platform team that can serve both customers.
Seems like there's a pretty big difference between two groups duplicating the work of a handful of engineers, like in your query engine example, and billion dollar programs like in the article. My personal favorite example of the former were workflow systems; somewhere around 2009 Google had like 15 different ones. But obviously the reason was that nobody had foreseen such a need early enough, a lot groups ended up building their own solutions, and with so much fragmentation none of them could reach critical mass organically.
In terms of large scale and crippling internal competition, Nokia comes to mind with their utterly non-cooperating consumer vs. business mobile phone divisions back in the day.
I don’t think it is so much that they don’t have better things to do as it is that their primary project is blocked by some distant tool not quite doing what they need and unwilling or unable to make it do what they need.
So the engineers roll their own. It works perfectly well for their narrow use case , but is also half-baked for the general case.
Then a year later some distant team sees that you half baked solution would work for them if it were generalized a bit, but you don’t have the time or resources to help this distant team. So yet another half baked solution appears.
IMO the alternative is not clearly better either. A certain amount of internal competition and diversity is healthy, but not too much nor too little. Putting “all your eggs in one basket” can also end in disaster, and the worst case is arguably worse.
"Eddie Lampert broke the company into 30 plus autonomous businesses, each with its own president, chief marketing officer, board, and separately measured profit and loss.
His idea was to harness the power of the free market, and to produce better and deeper data than anyone else.
But the radical restructuring went horribly wrong, as divisions engaged in cutthroat competition against each other"
I really wish I could, but unfortunately I read it all back-to-back, along with related material from Shewhart and authors writing about Deming's writing, and it all kind of blends together in my head.
I do plan on re-reading Out of the Crisis to begin with, though, so maybe there's some (good? bad?) subconscious reason I want to start with that.
Can you summarize at a high level, specifically, his philosophy against individual rankings/bonuses? If I, a hypothetical high achiever, knew that my average co-worker was to receive the same bonus as me, sure I may be more collaborative and work towards the overall success of the team, but I personally sure would be demotivated to work as hard as I may have otherwise.
First off, individual rankings often do not measure actual performance, but rather statistical noise. Awarding Alex with a bonus because Alex happened to be the luckiest in what was essentially a lottery (that's what the maximum of statistical noise is) tends to breed frustration, first in everyone else for not getting the bonus despite doing almost everything the same as Alex. But the next year, some people will start doing things like Alex did them, and they'll still not get the bonus because they didn't also have the luck of the draw. Alex will also get frustrated because Alex might have continued to do things exactly the same as before, except now ranked much worse!
When you're rewarding statistical noise, you're effectively holding a lottery. That's weird, but probably not so bad. When you tell your employees that it's based on performance, you're flinging your company into a cycle of despair and confusion -- or, at best, indifference.
But wait, there's more!
Let's pretend that you work for a company that is careful to ensure that performance is statistically significant before awarding any bonuses or ranking people. Companies don't do this, but we're free to imagine them to.
Even in this case, Kim's outperformance is often possible only because Kim's team propped them up and assisted them. Rewarding only Kim and not their team breeds discontent in their team. You might argue that "if Kim wants to continue outperforming, obviously it is Kim who should share the bonus with the team." Sure, but do you ever think that happens? What happens is that the team will start hiding information from Kim.
And then people start to game the system. They go for the easy sells to customers who are bad fits. They ship things that shouldn't be shipped. They cherry-pick metrics to support their performance. When you make a ranking or a bonus a goal, that's what you're telling people to aim for, not quality of work.
There are more arguments here like how bonuses are not as motivating as you think -- unless you pay people too little to begin with in the first place, but I think Deming's arguments end with the above.
I can see how having the team rewarded for "your" performance can suck. In a healthy team, "your" performance wouldn't be possible without your team anyway, so it's not so odd as it may sound. In an unhealthy team, the work of improvement maybe has to start somewhere else.
Coincidentally I re-watched The Looming Tower[1] yesterday night. While it may have dramatised the rift between CIA and FBI based on what I have read it was quite vicious at that time.
Another great example is how Apple beat Sony to iPod. Sony had key pieces in place -- terrific content and an iconic portable music device (Walkman). Yet the company's DNA and culture meant they wouldn't talk to each other (for whatever reason) to integrate them both to launch the next generation portal music device. Some VP may have felt awesome at winning a turf war but look what happened at a bigger game.
> There were no layoffs, no reassignments to different groups, they just let everything float for pretty much the summer. It must have cost a fortune, and I highly doubt anything would go down like this ever again in today’s tech business world.
This has happened to me before at Microsoft. Eventually people were given the 90 day "find a new internal position or you'll be let go" but IIRC it was a good 2 months or so of doing nothing before that kicked in.
It’s very common. Top management in large political orgs do not want to be associated with a failed project. They will spend the first days actively covering their tracks. Once this is done, they usually send HR to clean house. Unions stay low too because on the paper this good for the employees (salary is there, more time is given to pivot, etc).
It can happen at smaller scale in small companies, too. In my first serious job, when the CEO left after a merge his assistant/secretary was left behind but with nothing to do, and was forgotten. At some point someone realised that she had spent several months doing nothing but playing solitaire on her PC. She didn't complain because she was afraid to simply be fired, obviously.
In my experience, internal competition in a sufficiently large organization is inevitable. This may be a hot take but I think it can be healthy. Also trying to eliminate internal competition can often be worse than internal competition.
Why? Because management ends up anointing a "winner" when there are competing proposals before anyone has built anything. This rewards people who are good at getting projects approved rather than execution. And I've seen so many bad projects, late projects and projects that fail that come out of a process like this. More often than not, those who started the project have long since claimed credit and moved on to other projects or companies so any failures get blamed on execution.
Additionally, the process of anointing a winner takes time and resources you don't necessarily have. Those decisions are typically based on factors that don't matter or wrong assumptions you'll only find out when the rubber hits the road.
Look at iOS and MacOS. A certain breed of manager would've decided this internal competition was "bad" and would've spent a year figuring out which one to invest in because "two OSs are bad". Rather than getting paralyzed with indecision, it's nearly always better to ship earlier and figure out what to do later.
Look no further than Windows to see why. Steve Ballmer, who came up as the business head of Windows, saw everything through the lens of Windows everywhere. So when smartphones became a thing, what did he do? Adapt the Windows OS to phones of course. Microsoft lost time to market and Windows Phone went nowhere. Years earlier Microsoft bought the then popular Sidekick and rather than rolling with it they spent years figuring out how to move it to Windows.
This can of course go wrong. Anything can. But in a sufficiently large organization your attitude should be how to handle internal competition not how do you eliminate it. The latter is a fool's errand.
At my previous job I didn't experience the internal conflict thing as much, we were lucky in that regard. But I did experience the "doing nothing for a while" thing. Within a couple of weeks my boss and his boss both left the company and it took forever to find replacements. Our team finished up our work that original boss had assigned and then...we were told to just keep doing what we were doing...which for the most part was playing call of duty on our company machines all day...
At my current job there is a ton of internal competition and near constant reorganization. This very week my team was rolled into a new organization, and we're working as hard as we can to out position another team so that we don't get rolled under them (or replaced by them). We've positioned architects strategically and work well outside the chain of command to socialize our roadmaps and designs. We every so slightly bend policy where we can. Anything to gain an edge on "the competition" (who are vastly more well funded but who service a considerably smaller section of the enterprise). It's extremely stressful and not productive and absolutely not why I joined this company two years ago. So I'm interviewing at our actual competition. I've spoken with their HR and the person I'll report to already (if I get an offer). Next week I have three more panels and then hopefully I'll know something soon. If it works out I'm going to knowledge dump to my team, tell them to update their linkedin and GitHub, and then I'm going to burn off my PTO and drop my two weeks.
> There were no layoffs, no reassignments to different groups, they just let everything float for pretty much the summer. It must have cost a fortune, and I highly doubt anything would go down like this ever again in today’s tech business world.
Oh lol I’m kind of experiencing this right now. I think it’s more common than you might think.
This was a great story and it reminds me once again that little in the world of business is new. I wanted to share some thoughts on this paragraph:
> Today I find it ridiculous that a major corporation would allow huge groups to silo to this degree, to fail to communicate, cooperate, and share, and to allow them to build overlapping and competing products. To allow this kind of animosity to build between employees of the same company. We’re talking about thousands of engineers involved here, between the two divisions. Seems like something that could have only happened in the crazy 1980’s, but I am betting if enough people read this far, we will see comments to the contrary.
This happens very regularly and it is to the detriment of both the company and employees. I'll take the tech giants as an example, although this probably applies to other enormous organizations as well. Google displays this internal competition in one way, with a scattered, inconsistent, and ever-changing strategy for products like Chat that many on HN have joked is caused by promotion-driven engineering and cut-throat focus on personal gain. Amazon allows multiple teams to go after the same opportunities, with the mentality that it is better to have two horses in the race. Microsoft had inter-org competitive dynamics throughout the 2000s that was captured in the famous organizational chart of tech companies (https://www.businessinsider.com/big-tech-org-charts-2011-6) - although that culture may have changed under Satya Nadella's leadership.
Large companies are less like small businesses and more like small countries or governments. So naturally, politics arises - but companies are new to it and do a bad job of dealing with political dynamics. So when they allow internal competition, they don't even manage to create a "fair" playing field. More typically, there might one team that is chosen to be the "survivor" by an arbitrary executive decision, or there might be a part of the company with more resources that out-paces the others, or the company may just make effectively random choices, or whatever else. This can leave talented teams and employees jaded, frustrated, and burned out. It can also create immense distrust that those affected carry forward with them into subsequent jobs or their personal life. As for the products and the company - the best ideas don't necessarily survive this, and the loss of talent eventually accumulates towards the fall of a big company from its peaks.
I worked at a shop with a psycho-in-chief who thought he was Frank Underwood on House of Cards. Internal competitions were one of his favorite things, but he generally had a pre-ordained winner.
In one example we had two teams asked to deliver the same calculation enginer:
- Team A: 1 dev, ~1000 lines of code, ~ 3 months but in a tech he personally hated
vs
- Team B: 15 dev, project manager, 100k lines of code, 18 months.. and they stole someone from Team A to basically explain the business logic to them
Team Bs solution was also on delivery 10x slower.
Team B won.
A year later once he was gone, it was all scrapped and given back to Team A.
I'm going through this same thing this very month. I personally am responsible for architecting and building a complex data store, data pipelines, and interface. This is to be used for complex targeting based on rapidly changing data.
I am doing it by myself. I'm the architect and I'm the engineer. I'm drafting the design and building it. And I did it. By myself. Inside of a month.
At the same time, another team is working on the same thing. Dozens of people on the team. Architects and engineers and a couple of data scientists. They took three months to get their first design out and it failed during testing. Their estimate to next iteration is two more months.
My design passed all the tests but one in the first trial and I fixed the remaining bugs inside of a week.
There's a good chance that the other team is going to have their product pushed into production ahead of mine, which will negate the need for mine so my code will get pushed to some archive server and sit there gathering dust.
Same goes for the azure work that I'm doing. Again alone and without any support vs our internal IT apparatus who has infinite money and can spin up temp teams with the push of a button.
I understand some managerial shenanigans in this scenario where you might view Team A of 1 as being something of a McGyver solution. I'd expect the natural step though if you have someone solving a problem in with 10% of the staff, 1% of the code and 2x the performance would be to shift some resources to them to productionize/productize/whateverize the thing.
While in the open market the best or first product doesn't always win, it's at least a competition of cost/value/quality/marketing/timing.
Internal competition is largely personalities and politics, with a predictable winner before the timer starts. In the long run if there is enough management turnover the rational solution can win, but you are basically playing chicken with senior management to see who quits first!
What SHOULD happen in DEC was your two platforms competing to deliver a better product, and if they crossed into each other's sales turf, whatever.
But of course such things never happen, Middle Management Machiavellis fight for their personal empires and it falls apart.
I personally think large corps that acquire a bunch of separate Datacenter groups shouldn't consolidate them, instead they should set them up for internal competition to serve groups. Well, and AWS, although that is probably a losing battle.
But again at the upper management levels, they can't tell who is doing well, so it goes the way of politics.
The free market... eventually, delivers the death blows.
I think the key thing is to encourage communication and cooperation between internal competitors, even if they're competing.
Maybe datacenter groups A and B have very different ideas about how to run their network, but they probably both need good SFP+ tranceivers and could pool orders or diagnostics or lists of parts to avoid.
They might not want to run as a single AS, but maybe they can share peering contacts or stats, and sometimes pass traffic for each other to tricky networks.
Sometimes, the right thing to do is to consolidate, and if it comes from both sides of the consolidation, then it's more likely to work well.
There's some danger of confusing customers if the competing teams are customer facing, so that needs to be handled with care, but it's doable.
The notion of cooperative competition seems impossible on the face of things. Perhaps an extremely detail-oriented upper management or structure that exists above or outside the budgetary turfs of both entities could do that, but to do that properly would impose an extensive meeting overhead on both organizations to maintain comms with this other group or the upper management.
And then any action taken on that would feel like a sword falling at any moment on groups, often disbanding them or redirecting them in what feels like an unfair and politically motivated moment.
Remember that people in corporations gain some degree of emotional investment in what they are working on simply due to the economic reasons that they are getting paid to do that, and getting paid is survival, especially in the layoff-happy no-universal-healthcare no-social-safety-net American economy. You work or your life falls apart.
So when I say knife fight, of course it isn't literal knives, but the motivations and survival instincts are the same. People can feel like this is life and death.
Probably why back in the day places like DEC and IBM didn't fire people. You can alleviate some of the life-and-death paranoia underscoring budgetary knife fights with the knowledge that you won't be fired and you can work somewhere else in the company.
The incentives come as a package. If you motivate them to compete, it incentivizes them to not help the other team regarding "good SFP+ tranceivers and could pool orders or diagnostics or lists of parts to avoid" and perhaps even sabotage them as long as it doesn't look like sabotage.
Internal competition can be ok if the cost is low. For example, having multiple ‘two pizza’ teams working on the same problem domain can reduce risk and help explore the solution space more quickly - multiple paths can be explored in parallel.
Knowledge can be shared or teams merged when at least one approach is found to be successful.
The problem in the article was that the competing silos were very large and expensive. And it sounds like a tribal atmosphere, where the effort of the competing silo was derided. That seems orthogonal to competition: competition can be friendly with the right framing from management.
The "I am better than you" culture in an organisation is funny. In the end both of them get paid below what they should be paid and they don't even own any stake in the organisation.
However, turning people against each other in an organisation, blinds them to the fact they are being exploited.
How else can you explain that you can't even afford a deposit to buy a house and at the same time the organisation is boasting about another billion of profits?
Tech people should get together and unionise, as they are the modern slaves.
Competition between employees can be really bad as well. In general you want to be working in a non-judgmental environment where people are not afraid to ask questions, share their ignorance, and teach others what they need to know.
If you often find yourself not daring to ask questions, or display your ignorance, maybe you should think about moving on.
I worked at an Investment Bank that did stack ranking and I worked with very smart people. So smart they figured out that helping out new guys on the team did absolutely nothing for them- any time spent not working on their specific OKRs was just detrimental to them. There was no incentive to help new guys on the team, and they were happy to just let them sink or swim.
I couldn't stand to see that, so I would help mentor the new guys, and it often did cost me a lot of time and affected my deliverables.
The joke was on us though- everyone was fighting for a bonus pool that largely didn't exist (this was in the aftermath of the financial crisis). Your only way "up" was to get out.
Any competition, by its very nature, competes with the idea of cooperation. One, after all, competes to win.
The perennial challenge is how to develop and maintain a healthy internal competition environment, especially when there are high monetary and non-monetary stakes involved.
I don't think this issue has been resolved or that it's unlikely to be resolved anytime soon.
One thing that I generally believe to be true is that internal competition is better than no competition.
If a company doesn't have internal competition, it may be prone to group think. It is also highly likely that it will face an existential threat from external players who are not an thinking alike.
There is a popular narrative being reproduced that Walmart is a bigger planned economy than the Soviet Union ever was, and that they tried an internal market and that it was a disaster. Meanwhile the narrative says Sears was run into the ground by over-zealous capitalist idealism and blind fate in the free market.
> There is a popular narrative being reproduced that Walmart is a bigger planned economy than the Soviet Union ever was, and that they tried an internal market and that it was a disaster
Honestly, this misses the point entirely. Both planned economies and unplanned economies have organizations doing the producing and these organizations are obviously planned internally. But in a free market economy there is competition, so when these bureaucracies (inevitably) become sclerotic or dysfunctional, they are driven out of the market by new competitors, and so competition is what keeps things efficient. Whereas in planned economies there is no competition. If you want a car, you go to the state auto company. And when that bureaucracy becomes sclerotic, you can't defect and launch your own competitor. Nor can the state motorcycle company decide it wants to pivot into autos and drive the state auto company into the ground by offering a better product at a lower cost. There is simply no competition and thus no alternative for consumers. Therefore you see this typical pattern in planned economies where there is an initial boom and things even look really good but over a generation all these bureacracies become dysfunctional and require more and more inputs to produce a single output, at which point you start seeing chronic shortages and terrible quality problems.
Arguing that the actual bureaucracy doing the production is "planned" and thus there is no difference between an economy based on competition and a planned economy with no competition is not to understand why one of these is superior than the other. It does not matter how big Amazon is, what matters is that there is competition to Amazon and that Amazon can be driven out of business once is starts to become massively inefficient.
This is a simplified view of the differences, to the point of maybe being oversimplified. (But you probably know that already.)
Something "free markets" provide over planned economies is free(er) flow of information.
Markets/economies are often incredibly complex. Allowing individual actors to signal information through pricing and competition, and allowing risk takers to exploit differences in these opinions of people to profit and simultaneously even out the differences in the direction that best corresponds to reality builds a system where it's much more likely the right things are done by the right people for the right reasons. It's just too complex to plan for. And besides, without the free markets there to give you feedback, you won't know what it is you're planning for.
A (socially fair) free market is also a proper scoring rule for forecasts. It rewards people who are good at seeing into the future, and punishes those who are bad at it, in proportion to the costs of their errors. (This goes back to de Finetti's operational definition of probability.)
Note that this is rather abstractly, in some sort of perfect microcosm. In practise, all free markets are distorted by privileged rent-seeking and other inefficiencies. I fully understand anyone who would be offended when I say that a free market punishes people who are bad at seeing into the future (hell, just reading that offends me!) because in reality, it also punishes all sorts of people, and often people who are great forecasters are precluded from exploiting their abilities in the free market, and so on and so forth. Please read my message not as social commentary or political bias, but the mathematical/cybernetic principles underlying this stuff, if executed well.
And obviously, this doesn't even begin to explain the Sears/Walmart story, so I suspect there are other factors underlying that, too.
Right but the person you are replying to is talking about company internals. If companies are planned then what happens if a department becomes sclerotic (great word btw) or dysfunctional? Surely by free market rhetoric the most efficient way to deal with that is by having a company internal free market that cuts away the sclerotic parts through competition?
If that doesn’t work well then what does that say about the wider free market approach? If it’s better to deal with internal department dysfunction in a different way why isn’t that process applicable to a wider planned economy?
“If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, two people were going to get a great review, seven were going to get mediocre reviews, and one was going to get a terrible review.” “It leads to employees focusing on competing with each other rather than competing with other companies.”
I totally agree... a large part of Rome's decline was the intensity of 3rd century crises, and the civil wars that happen at that century between factions/self named emperors vying for power.
This happens in any large organization to a degree...
The article thoroughly fails to prove its claim. They had two separate divisions working on competing projects, sure. Was that bad? Did that actually hurt them? The idea that they would have built something better if they'd been on friendlier terms, if they'd talked to each other more, seems to just be blindly assumed.
It gets even more interesting when you think that by definition, our economy is supposed to be a long term win by having completely separated companies building the same thing competitively.
If its poor allocation for the company, why is it a good allocation method for our economy as a whole?
If its a good allocation of resources for our economy, then what makes it bad for a company to do it internally?
Competition in an economy works because the market picks the winners and allocates resources to them. Often that means several winners because different competitors have complementary strengths and weaknesses. Nobody knows their requirements and price tolerance better than the customer. Incentives of the producer and customer are aligned.
Inside an organisation there’s no real mechanism equivalent to a market within which these alternatives can compete. It almost entirely comes down to politics, not relative cost, features and technical suitability. If a team’s solution is adopted by another department does their revenue go up? Do they get extra resources? How do they advertise their product? What’s their incentive to provide customer service and support? If they get a new project or strategic direction and this ‘product’ doesn’t fit their vision anymore what’s to stop them just dropping it? After all none of their budget actually comes from this ‘product’ no matter how many other teams use it.
It’s not that these problems can’t be solved, but there’s no real market or real revenue stream there so market forces have to be consciously emulated by management fiat. If enough layers of management lose focus on that, or management changes, it all breaks down.
It’s basically the same problem as with planned economies.
With internal completion aren’t there internal customers, or even external customers too? I think you bring up some interesting points, but think there’s some deeper considerations than market vs planned.
For instance at a macro scale, China has a hybrid approach and for many planned industrial growth areas have been successful from furniture to solar to being on their way with chips.
Planned investment is arguably how many companies work very successfully.
I’m not arguing for all planned control, but suspect some set of features that make some competitive approaches work well and some planned approaches work well.
> With internal completion aren’t there internal customers, or even external customers too?
Internal "customers" are generally spending someone else's "money" and their own success or failure is often more dependent on politics than their merits.
Competition works if your success metrics are measuring the right thing. But internal popularity often isn't.
It’s risk vs. efficiency. Duplicating work lowers risk at the cost of efficiency. Without redundancy, the market is unstable.
Look at the pipeline shortages of the past year. A chip shortage screws up many industries because all eggs are in one basket. Farmers have government incentives to overproduce for to prevent food instability.
A company always has competition due to promotions, by the way. Competing at a team level makes sense for R&D, since products can end up different. But I’m not sure how it makes sense for a big, resource heavy project.
Yep. If they had all coordinated their efforts then they might have settled on some inferior design and stuck with it for longer than necessary. That third group might not have been around to look into that CMOS stuff
I hear you, but I don't think the article is that specific.. It's an internal article.. I happen to agree. Along the lines of Era, a greek, you could put stoicism in there. But writing about it wouldnt be stoic.
When the title is "Internal competition can often be the most dangerous kind", I would expect some sort of support for the idea that internal competition is dangerous. I didn't find it. They had internal competition, their product failed, but there's only the vaguest handwave towards relating these two facts together.
What I see when I look back at things is often product lines only partly overlap. Other times with mass produced products the NRE is actually a small percentage of the unit cost. This is even more true when in markets where technology gets amortized over long periods.
It's not competition that is the problem. It's score-keeping and secrets. Our competition against each other allowed us to have fun and push ourselves to the point where we took our skills as far as was possible.
A key component of this is that we gave credit where credit was due. My friend didn't get credit for beating me, but for sharing with me the secret of my defeat; and vice versa. Once again on equal footing, we credited each other not with knowledge, but with the skill to apply the knowledge.
That experience has guided me in my life. Sure, in an unhealthy organization people can take advantage and not get back. But healthy competition has paid off more than it's cost me, and I've always thought life was too short to be in any unhealthy relationship, even with employers or coworkers.