> And worse – he’s confirmed that many Google employees are interviewing with Facebook and Twitter, among others, simply to get a hefty raise. “Many people at Google use Facebook offers in order to get a big raise,” says Buchheit.
I don't understand why this is "worse", i.e. why interviewing purely to get a raise should be thought of as a bad thing. To me, having many (hopefully low cost) interviews simply allows software developers to be efficiently priced as market conditions change.
Now, the natural response, if employee value can move upward more easily, is that employers will be less willing to offer job/salary security. But, on average, this is good, right? Fighting this is like fighting to go back to the old pensions system, which drastically reduced employment flexibility and was a major source of economic friction.
So, would you say it is no different than when companies offshore development to reduce costs? After all, when companies explore cheaper offshore options, it “simply allows software developers to be efficiently priced as market conditions change.”
I’m sure I will get my share of down votes for this, but as a cofounder that has hired several developers, I’ve had people come to me with better offers and give me an ultimatum. I rarely counter as there is no guarantee they won’t come back sometime later with an even higher offer, and so on and so on. What if your employer did the same sort of thing and came to you and said – “hey, someone with equal credentials and experience told me they would do your job for less, so you either need do it for the same or I will replace you.”
Yes I know there is no guarantee that the new person could perform as well, and that there would also be inefficiencies due to having to come up the learning curve, but there is also no guarantee that the other job will be better for the person entertaining the “better” offer. I have had people leave for a “better” job, ended up completely hating it, and then asking if they can come back. Um….no. This isn’t mom’s basement where if it doesn’t work out, you can always move back.
I’ve found to keep people, you need to pay them enough to take the “money” question off the table, and the ensure they have something meaningful and rewarding to do.
> So, would you say it is no different than when companies offshore development to reduce costs?
Yes.
>I rarely counter as there is no guarantee they won’t come back sometime later with an even higher offer, and so on and so on.
If I'm a builder and the price of wood goes up--but it's still the cheapest material for my needs--I keep using it. If it keeps going up, I keep paying more and more until there is a cheaper alternative.
Yes, it can be argued that there are key differences between people and wood, but you haven't identified them and why they are important here.
>What if your employer did the same sort of thing and came to you and said – “hey, someone with equal credentials and experience told me they would do your job for less, so you either need do it for the same or I will replace you.”
I would be bummed I was no longer as valuable of a commodity, but I wouldn't fault the employer.
That's good - many people seem to fault the employer in my experience.
Question though - the wood analogy was yours. You were expecting me to foresee that and list the difference between people and wood? I am also disappointed that your response did not address the differences between companies and....let’s say…Antarctica penguin colonies. ;-)
Well, I just meant that if you treat wood or people as strict commodities, then the fact that the price might continue to rise in the future doesn't really seem to imply that I shouldn't pay a slightly higher price now; you just pay the market price so long as you still make a profit and there isn't a cheaper alternative. (This is the naive, econ-101 analysis.)
But, of course, people are more complicated than wood. So if you wanted to argue that you should refuse to pay the higher price, you would need to explain exactly what the difference between people and wood are, and exactly why it should lead you to reject the naive analysis.
I’ve found to keep people, you need to pay them enough to take the “money” question off the table, and the ensure they have something meaningful and rewarding to do.
I would conclude, then, if employees are seeking substantial[1] raises by whatever tactic, that they're not being paid enough to take the money question off the table.
With Google, that should be no surprise.
[1] There's an assumption of rational behavior here, admittedly.
I agree. Have you seen any of Daniel Pink's talks based on his latest book "Drive"? There are some really interesting insights on money and motivation. In fact, in some of his examples/studies, paying people more actually hindered their performance. Here is a link to a summary of his book on RSA Animate. If you have the time, it is quite intersting: http://comment.rsablogs.org.uk/2010/04/08/rsa-animate-drive/
Specifically, you will be rewarding behavior that has nothing to do with advancing your business. The employee will earn a raise by asking for one rather than you automatically rewarding them for outstanding performance. Why is this bad? Let me count the ways:
1. The other ambitious members of your staff will immediately agitate for raises as well. Note that neither this campaign nor the prior one need be correlated with actual performance. You will now spend time dealing with the political issues rather than actual performance issues. Importantly, if you have a competent board, you will not be able to give them all out-of-cycle raises, so your company executive raises will occur on a first-come, first-serve basis.
2. The less aggressive (but perhaps more competent) members of your team will be denied off-cycle raises simply by being apolitical.
3. The object lesson for your staff and the company will be the squeaky wheel gets the grease and the political employee gets the raise. Get ready for a whole lot of squeaky wheels.
Well, first, this is an argument about why it is bad for the company, not for the correct allocation of resources for society. (Although maybe you could adapt the parts about political inefficiencies to argue also for the latter.)
Second, it seems like all these problems go away (at least to first order) if you simply pay people what they are worth (as defined by the market). Being squeaky only helps if you need to do it to call attention to inadequate compensation.
I was asking myself what I would do in a Googler's situation. Would I game for a significant raise or not. I'm still not sure - I do feel like it's kind of a shady practice, almost like blackmailing your employer.
I wonder if there will be any backlash (unofficial or otherwise) for those employees in the future. Maybe they'll get passed up on future raises or promotions, get less interesting projects etc.
I don't understand why this is "worse", i.e. why interviewing purely to get a raise should be thought of as a bad thing. To me, having many (hopefully low cost) interviews simply allows software developers to be efficiently priced as market conditions change.
Now, the natural response, if employee value can move upward more easily, is that employers will be less willing to offer job/salary security. But, on average, this is good, right? Fighting this is like fighting to go back to the old pensions system, which drastically reduced employment flexibility and was a major source of economic friction.