Back in the original dot-com bubble, I worked at a place that had the most amazing coffee machine I've ever seen. It was the size of a Coke machine and made ten thousand varieties of boutique coffee, most of which I'd never even heard of, all made to your specifications. It was incredible.
Then one day a guy came in with a hand cart, loaded the coffee machine on it, and rolled it away. A week later the layoffs started.
The lesson here isn't that there's something intangible or magic about free sodas or coffee. It's that when you used to give out free sodas and coffee, and then you stop, you're telling everyone in the company that business isn't as good as it used to be. Beverages are an easy thing for the bean-counters to get approval to cut, so when times get tough, they get cut first. But they're also a small line item, so while they're the first thing to get cut, they're usually not the last.
In other words, the free sodas are the proverbial canary in the coal mine. When they die, it's time to get out if you don't want to die with them.
This is why, when I visit clients these days, I make a point of going with them to their break room to get some coffee before our meeting starts. If their beverage situation has been upgraded since my last visit, they're doing well. If it's been downgraded, I know to be on guard for bean-counters coming after my relationship with them.
It goes a bit further than that - you're asking people to make the shift from a non-monetary transaction to a monetary (quantifiable) transaction. This shift is one-way; once you get people thinking in monetary terms, it's very hard to get them to stop[0].
[0] Of course, you could make the argument that this principle applies on a corporate scale, not just a personal one, which is the point of TFA - Ariely's study just happens to focus on the individual.
A few years ago, they studied a day care center in Israel to determine whether imposing a fine on parents who arrived late to pick up their children was a useful deterrent. Uri and Aldo concluded that the fine didn't work well, and in fact it had long-term negative effects. Why? Before the fine was introduced, the teachers and parents had a social contract, with social norms about being late. Thus, if parents were late — as they occasionally were — they felt guilty about it — and their guilt compelled them to be more prompt in picking up their kids in the future. (In Israel, guilt seems to be an effective way to get compliance.) But once the fine was imposed, the day care center had inadvertently replaced the social norms with market norms. Now that the parents were paying for their tardiness, they interpreted the situation in terms of market norms. In other words, since they were being fined, they could decide for themselves whether to be late or not, and they frequently chose to be late. Needless to say, this was not what the day care center intended.
Right, but I might make the determination that I'm willing to pay that extra on a given day. If that's the market price for it, then I get to say if I'm willing to pay that price. And now my kids' teacher has to stay an hour later.
But if it was just a social contract keeping me from picking my kids up late, I'd feel guilty about it and make sure that it didn't happen again. And the teacher might only have to stay a few minutes later.
In my case, I know that my kids' daycare will charge me if I pick them up late. But I don't know what the fee is, and I don't know if they've ever told me. I don't care... I'm not going to pick them up late (I've been close), because I know their teachers have other things to do, and I consider it rude. If I knew it was $50/hour or $100/hour, if I was working hard on somethings, I, on occasion, may have chosen to be late.
Social contracts are tougher to break than market based contracts.
Exactly. I think it's interesting how high the cost had to get to roughly equal the cost of breaking the "social contract". As in, to end up with roughly the same number of occurrences of late pick ups.
However, one could argue that such an agreement would only represent a codified social contract. Ie it's still "You aren't holding up your end of the bargain" rather than "the contract is for 2 hours/day with an optional extension of $100/hour each day."
My doggie daycare[1] 'closes' at 7pm, but charges $25 per dog per 15 minutes that I'm late. After 7:30pm, they board the dog at the standard "no notice" rate (which is something like another $50).
There have been times when I ended up in SF or BART traffic. I misjudged my commute time and arrived late. (This doesn't happen a lot, maybe 1-2x/year)
Almost without fail, the staff were really negative about my lateness. Some have lectured me about how it messes up their schedule, makes it hard for them to board other dogs, finish cleanup, etc.
My thought on the matter is a simple economic one. If it's not worth it to the business to charge only $25-50 for a late pickup, they should think about what the "right" cost is. They actually have the power in this situation. Raising the cost would a) enable them to staff for this, and b) have a greater impact on habitual "late" arrivals.
As it is, I think,"Is it worth $25-50 to stay on this work call, knowing I may be late?" rather than,"I have to go, because I'll be inconveniencing the people that I trust to look after my dogs."
(Usually, it's more "I want to see my dogs," but you get the point.)
[1] Don't judge. I'd rather have them run around all day with a dozen people, a fountain to splash in, varied toys and 'playground' equipment, and a bunch of well-socialized dogs in their own size range than sit at home all day. :-)
Let's say once a week someone is late and there staff is paid 20$ an hour including all overheads. For that extra 30 minutes it's going to cost them 50$ a week which is about what they do. However, if they instead only pay people when there actually late that's 40$ a week in profit * 52 weeks = ~2k/year which for a low margin business may be significant.
I would say at least as important is that the sodas disappeared without any input from the people using them.
It's a cut of a very small benefit, but it is still a cut. To do this without any prior discussion from the people receiving the benefit will only be taken badly.
I'm not sure market norms vs. social norms apply here (as long as money isn't explicitly mentioned) but it's definitely a shift in the relationship. The "free" stuff is a signal that the company cares about you and when it's taken away you feel like they no longer care.
The other thing that happens here is loss aversion. Losing that "free" coffee or soda is painful.
>The lesson here isn't that there's something intangible or magic about free sodas or coffee. It's that when you used to give out free sodas and coffee, and then you stop, you're telling everyone in the company that business isn't as good as it used to be.
I had a client take cost-cutting to such an extreme, they no longer provided paper cups for employees to drink water. In theory they could've halted the water deliveries, but that was too probably obvious an indicator.
Sadly, them cutting the paper cups fooled a lot of their employees, in which they genuinely didn't think things were that bad. Anecdotally, the ones who thought nothing was wrong with cups being cut were the ones that were laid off weeks later.
Sadly, them cutting the paper cups fooled a lot of their employees, in which they genuinely didn't think things were that bad. Anecdotally, the ones who thought nothing was wrong with cups being cut were the ones that were laid off weeks later.
Makes sense. The ones who didn't parse out the puzzle were probably the employees of lowest relative IQ and savvy, so they were probably the least valuable ones.
Hindsight bias. What if the GP told you he was lying, and that the people who didn't notice were the last ones to get laid off, because they were so absorbed by their work that they didn't have time to notice the cups? Does that make more or less sense than the alternative?
Perhaps the people laid off were the most intelligent but least politically connected because they were focused on their work to the exclusion of water-cooler chatter.
There's a big difference between cutting soda because you're flaming out, and cutting soda because the company hired "professional management". The former is penny stupid, but the latter is pound dumb.
Unless you're filling swimming pools with soda or something, drink and snack expenses are rounding error on the salaries of your people. If it comes down to the free drinks, something else is broken. The real tragedy is when idiot bean-counters take over, and start imposing these sorts of nit-picky cost-controls because "that's what big companies do".
It takes a strong leader to stand up for company culture, because these sorts of issues often look like they're too small to be worth a fight. You grow to 200, 500, 1000 employees, and before long, you have to go out of your way to pull the Senior Bean-Counter for Drink Expenses aside and tell him to back off. That's when the bad stuff happens.
I'm not management, but I've had it described to me like this: cutting soda, while it may be insignificant and certainly isn't going to change a damned thing money-wise for the company, makes the management feel better about the situation. It makes them feel like they're doing something and something is better than nothing. It's also a CYA tactic. If the CEO wants to hold somebody personally accountable, the CFO can say "look, we did everything, we even cut back the soda!"
Diversion warning: it's surprising to me how many management decisions get made solely to make people feel like they have control in a situation where they actually have no control. It's the same mechanism the government exploits when making decisions about the TSA.
I started putting my resume out when the free soda ended too. funny thing was my old boss got angry when I mentioned that as one of the reasons I wasn't happy any longer. He said they didn't take it away they just stop providing it. for the life of me I cannot tell what the difference is.
Maybe he meant it in a way of "The coke is still there, you still can drink it, i just don't pay it for you"? I think that could be a way of thinking about it if you really want to justify it.
"Free Soda" is a perk of the job. That perk was removed. It was 'taken away.' In the end, it's academic to quibble over whether or not the free soda was 'discontinued' or 'taken away.' It doesn't really matter. Free soda is no longer there, and this upsets him. His boss arguing the correct wording isn't going to make him happier.
Exactly. But why would he be touchy about an employee providing feedback? Where I work that's the escalation path, talk to your manager about things that bother you or that you're not comfortable with. A manager refusing to take my criticism means either the manager is failing at his job or that he's incapable of doing his job.
A simple, "I'll bring it up in our next meeting" would soothe me over much more than arguing over semantics and entitlement with me. Or even just being sympathetic: "Yeah, I know it sucks, but them accountants needed something to trim this quarter!".
But the defensive reaction tells me there is something lurking underneath the surface, be it frustration or resentment.
Having had to manage the worst possible situation (multiple rounds of layoffs), it's a shitty situation for everyone.
Obviously, it's the worst for the people who are being terminated. As a human, a good manager wants to assure them that s/he values their contribution, blah blah, but all they hear is what is said in the first 30 seconds. Hit the high points – we are laying you off, you are getting n weeks/months/years of severance, here is all of this in writing, plus your benefits package and final check, do you have any questions?
It's also very unlikely that the manager had much say other than in terms of force ranking people (if that). I found out at 9pm the night before that I would have to cut more people than planned.
Your boss may have been thinking something along the lines of,"20% of our company just lost their jobs and you're worried about the free chair massages???" because their brain is still in the context of not only "I can't protect my team," but also "I had an active role in their termination." They're often in the "bargaining" phase of grief and thinkin,"without x, I could have kept one person," or "One of my leads could do my job with this new team size, so my leaving will save 2-5 jobs in the next round." Those things go through your manager's head.
The best a manager can do is to take the "survivors" away from the office (conference room in another building, on a walk to a local park, whatever) while people have the opportunity to pack their personal effects. Tell the team everything you can about why the layoff took place, who was affected, and get as much of the bad shit out that you can.
They'll rant at their managers, they'll rant at the company, and the managers have to take it. Try to avoid the company party line and give people as realistic a view as possible of what is happening and what will likely happen. Try to bring in the highest execs possible to answer questions, because a manager may or may not know, or be able to tell, some details about the financial forces driving the decisions.
TL;DR - It sucks for everyone, including your manager, so s/he may be crankier than normal. Extend compassion their way as well. If you're a manager, see the blowback coming and get in front of it and be genuine.
I view the free soda not so much as a perk, than an indicator that the folks in charge "get it." Without the soda, I can just as well get some from the store, and bring in my own snacks for a negligible amount of money. But the cost to the business due to time wasted doing this must be gigantic. The fact that management doesn't see this is a clear sign that they don't merit respect.
Back in the original dot-com bubble, I worked at a place that, when it was time to flame out, flamed out so fast that management didn't even have time to empty out the break room.
I think seeking to understand the financial state of a company is smart for both employees and consultants, but the assumption that "upgraded beverage selection" unequivocally equates to "doing well" is naive.
Frankly, in my experience, a young company adding a bunch of perks is just as likely to be living beyond its means as it is to be doing very well financially, but that doesn't really matter. As a consultant, you don't mitigate the risk of not getting paid by asking about the soft drink selection or looking at the lunch menu. You mitigate risk by diversifying your client base, negotiating favorable payment terms and watching receivables like a hawk. All things you should be doing anyway regardless of the client or the state of the client's break room.
I think you're reading a little too far into what the parent post said. I can't speak for him, but I'm fairly sure he's not saying that the state of the breakroom is a valid, tested, and factually accurate rule for determing company state. I'm pretty sure that he's saying it's more of a rule of thumb.
In the case of your company, it seems that the loss of the coffee machine was just the start of an impending death spiral (er...or am I judging too much from the preface of "in the original dot-com bubble")...but what about more moderate scenarios?
Take, for example, Tumblr, which right now is a pretty big success. Just a month ago, they laid off their entire editorial team. Who knows if it was at all related to the Yahoo purchase, or if it was a decision made because Tumblr really need to cut expenses? But sometimes companies change course and cut because of ostensibly responsible financial concerns.
In the case when an exciting company has to trim (but not just die), how should it handle the case of having a fancy coffee machine and possibly saving a job? It seems it would be a bit awkward if the company laid people off but kept all of its original ostentatious perks.
If you worked on the editorial team, it was a death spiral for you even if the rest of Tumblr went on to a big exit. (And off-topic, but: I bet those folks who used to work on the editorial team are cheesed they got canned right before the big payday.)
I have no knowledge of Tumblr's internal workings, but I would bet if you talked to the folks who used to be on that editorial team they'd have stories of their own budget being squeezed in trivial ways before the layoff. Laying people off is hard, managers don't like to do it, so they almost always look for other ways to save money before biting the bullet and canning people. And when management decides that a particular division isn't critical to the overall business, it's typical for the bean-counters to be unleashed on that division to look for "economies" that other divisions more beloved by management don't have to bear.
That's like saying it's be a bit awkward if they laid off a bunch of employees but kept all the salaries of the remaining employees the same. Because by removing the little perks they're trimming everyone's salary just a little. You're already asking your remaining employees to work a little harder to make up for the loss. No need to add insult to injury and ask them to do it for a little less as well. In a time of turmoil I'd rather keep as much as possible familiar.
Very good point. This goes hand-in-hand with "cut deep so you cut once." You can't leave that sword hanging over the heads of individual contributors or they'll activate their network and start entertaining offers.
Since the process of layoffs generally involves a rank-and-yank, the people who remain are precisely the ones who have the option of working elsewhere. They can generally (depending on the location) get an offer within a day.
That's also a really good point. I knew someone in that position and he didn't last much longer before bailing on the company. He had no problem getting new offers.
Companies just see an easy line item savings without thinking of the impact on the employees they desperately need to hold onto. On top of any potential insult to the employees, the companies that do this are giving off a terrible impression. "OMG. They can't even afford free soda anymore. This ship is definitely sinking."
I am curious about how much a coffee machine really costs. I don't think it can be that much to merit getting rid of it. People that try to save a few pennies usually waste much more elsewhere...
Typically not that little in bulk, unless you stock your own entire soda machines with syrups and carbonation systems and such. If you had people stocking up from sam's club or a similar 'bulk' store, you'd be looking at per unit costs of 25-60 cents per bottled/canned drink, depending on size.
Coffee - not as familiar with the economics of coffee, but of course dedicated machines will end up costing somewhat less than going directly to starbucks.
And most Cokes in a convenience store are now $1.50 or more, at least where I live.
Let's say 50c per soda. Even if everyone drinks 6 sodas a day you're looking at an increase of $900/year/employee. Call it $100k/year for an engineer and you're talking less than 1%. And that's 6 sodas a day, every day. I bet even with free sodas you average maybe 2 a day.
And if you have an entire team of engineers drinking 6 sodas per day each, your health insurances will balloon (as will their waistlines) in the next couple years.
It's amusing, because a 2L from a supermarket is the same price as a 20oz from a convenience store. Clearly the price is not driven by the cost of the soda.
In the case of Coke, I think the cost of packaging is bigger than the cost of the product, but either way its almost irrelevant to the price - they charge what people are willing to pay. I wouldn't buy a big bottle from a convenience store, a small bottle is more convenient for walking around with. I wouldn't buy a small bottle from a supermarket, I want a big bottle to put in the fridge at home.
Typically the smaller ones are also refrigerated whereas the 2L aren't, precisely because you're expected to grab the former when you're on your way from A to B and are busy.
I remember when Harvard, which had a $25.6 billion endowment at the time, stopped offering free breakfasts for upperclassmen (this was 2009, I don't know if they have reinstated it). It was a big deal at the time; it even made the New York Times.
Trhtrsh, you have been hellbanned as of this [‡] comment. I'm not really sure why; HN might have changed their algorithm for banning, or you might have been banned for a bad submission.
It is always sad when these things happen, but it is not surprising. Many startups spend so much time optimizing for survivability, that they don't optimize for happiness[1, 2].
And that makes sense in the beginning. As Ben Horowitz said[3]:
If you don’t have winning product, it doesn’t matter how well your company is managed, you are done
But as companies grow, that is not enough. Ben Horowitz complements[4]:
Why even bother with management if that is the case? But the truth is: there are several things that are very important:
1: if you get into trouble, and if you have bad management, your company will probably die. Like the people will just quit, they are not bonded to it, the don’t like working there, they never liked working there, and that is that, it is a wrap. ...
2: if you succeed at building a company that everybody just hates working at, what have you done? You just made a whole lot of people a whole lot more miserable in their lives.
Another canary example.. if you ever go to an small independent restaurant and they start using grocery store cheap napkins at the tables when they hadn't before, chances are its days are numbered.
A sure giveaway is to monitor the job board of the company. If they are bullish, they're constantly posting jobs and you can tell exactly what area of the company is growing or shrinking.
We used to get Dove Bars and beers all the time. It felt like free food was on offer at least once a week, usually with a pretense of some small milestone to celebrate. Why did we cut stuff like this? (I know the boring fiscal reasons why. I’m asking the deeper why, as in, “Was it worth the savings? Is Microsoft better now that we’ve cut these costs?”)
One day, a sign appeared on a soda fridge in RedWest saying something to the effect of, “Did you know that drinks cost Microsoft [ed: millions of dollars] a year? Sodas are your perk at work. Don’t bring them home.” This depressed me on too many levels to enumerate, but I’ll toss out a few:
- Someone had enough time to get these signs professionally printed and affixed to our fridges.
- It was someone’s salaried, 40-hour-a-week job to do things like this.
- Someone thought soda smuggling was a big enough “problem” at Microsoft to draw attention to it.
I worked in RedWest a few years ago. People were fired, more than one, because they were caught bringing in -roller luggage- multiple times a week to fill with varying drinks. It was only noticed and a problem because Catering noticed they were needing to refill those fridges more than twice as much (and there were four commercial sliding glass door fridges) - so a group of people were taking multiple fridges a week home. That's probably in the order of a couple of thousand dollars a week.
-That- was the problem. Not people like me who might grab a can of Talking Rain as we left the office for the commute home.
So when the smuggling ""problem"" amounted to thousands of dollars a week of goods going missing from one building/floor alone, then yes, they drew attention to it.
As for his other points:
- Microsoft has its own inhouse printing departments. It was hardly a project in itself to arrange for a small plastic sign to be made and glued.
- Yes, Catering has people whose salaried, 40 hour a week job is to handle the logistics of food ordering, and predict supply and demand. People like this are needed when you have upwards of 50,000 people working in your facility.
- a $100,000/year theft problem is worthy of most people's attention. If you're stealing multiple commercial fridges-worth of soda a week, it's not even that you're taking it home - you're almost certainly reselling it. So it's not even a perk, it's a commercial gain. Maybe I should have been raiding the Office Supplies and selling them, a la Dilbert.
3. Put a notice on the drinks machine that, through use of polite informality, makes it clear what was going on and that it would be appreciated if people didn't take the mickey. ("Inform, don't instruct" should be a rule of management.)
Identify the perpetrators but don't sack them immediately. Investigate them thoroughly. Assuming they're well paid, resorting to carting off a fridge full of soda every week is a disturbing way to behave and I'd want to understand their motivation and identify if they behaved this way in other areas of their work-life. They likely thought (1) they'd not get caught or(/and) (2) the value of the theft was so low that they'd likely not get in trouble. I'd be concerned most about the "I won't get caught" people at any company that a large part of their profits are from selling closed-source software. Sharing loads of source code might also be seen as something they'd think they wouldn't get caught doing. I'd still be concerned about anyone with the moral flexibility to brazenly steal large quantities of even inexpensive items and expect, if caught, to get away with it. At a minimum, that's not the kind of culture you want to spreading and it probably speaks to their intelligence slightly.
Generally, people hate "passive-aggressive notes". At a previous someone placed a note on the sink asking everyone to clean up the microwave after using it. Someone had heated up pasta and left the tomato sauce all over the interior. I took the note down and kindly asked the person responsible to be more careful in the future. It was equally effective, but without pointing the finger at every person on the floor. In the case of the soda, skip any note and let the word spread through informal lateral communication ("gossip" channels are rarely used effectively by management).
Those perpetrators have a strong overlap with people in their last year of vesting who are both coasting at work and running some side business out of their office.
Identifying them for further investigation will generally turn up more ethical and performance issues, safely justifying reassignment or outplacement.
Fountains stops people from emptying the fridge, but it doesn't stop them from filling up two liters. This was a problem at one of the cinemas I worked at as a teenager. Management had to crack down on "abuse of the free soda policy" after they realized we were going through way more syrup than we should be.
Hm... more like: someone was smuggling sodas out of the building that were offered in good faith as an office perk. Frankly that would affect my morale more than even the removal would. What does it say about an office culture where that kind of petty thievery is tolerated? Honestly my feeling (and to be clear: like this whole subject this is subjective) would be that this response is not enough: better to name and shame the offenders.
Smuggling? Really? Why does Microsoft care where I drink my soda? My brain doesn't turn off at 5pm: last night I was up until 3am, at home, figuring out some bug my change introduced. Yes, I drank an employer-provided Diet Mountain Dew that I brought home. No, my employer doesn't care. Perks are for people, not locations: as long as I'm drinking the soda, Google doesn't care where I drink it.
That would be ridiculous right you could be thinking, programming and improving the product to get a better bonus in the end rather than sell soda off of craigslist or ebay.
But you see that is how they think about it. You are stealing it and could be doing <insert the worst possible thing>. That is what management might come to conclusion about.
Another perspective + a story. (Warning: getting a bit prejudiced here). I have heard of foreign H-1B workers (won't name a country will stop at a vague level of prejudice) stuff their backpacks with soda. Stay late, look around, see if anyone is looking start shoving soda cans to fill the backpack up as much as they can carry.
It wasn't that management was upset, you see, it was other co-workers that were disturbed by that. Why? Because they realize they are working with "that" person. That would be disturbing to me. Is the company not paying them enough. Are they a kleptomaniac. Did they grow up poor and learned to steal food. What else are they stealing? Are they sabotaging our product? Do I want them around? Questions like that.
They complain. How does management react. Well they could lay off so and so. But heck he is chugging along programming and we got him on H-1B sponsorship. Laying him off because of a soda issue is worse than just making everyone pay for soda and, in return we get to save couple of thousand dollars a year.
That is how I heard about* (from another party, so this might have been made up, I don't know, take it for what it is worth).
I don't think your story is prejudiced. I can only imagine how coming to work at [major tech company] from [developing nation] would be such a mind-fuck that the person may honesty have no idea what the intent of the 'complimentary sodas in the kitchen' policy actually is.
Putting a sign up in the kitchen is always the wrong solution.
God damn that was depressing to read. I've seen various levels of cheapness but this takes the cake. Stuff like this makes me ashamed of being an Indian, really. Oh well..
And I don't think what you said was prejudiced either.
> I've seen various levels of cheapness but this takes the cake. Stuff like this makes me ashamed of being an Indian, really.
Don't feel ashamed, this level of cheapness has nothing to do with your nationality.
My dad was a physician, born and raised in the US. He earned a good living, worked very hard (he never had fewer than 2 jobs the whole 3 decades I knew him), and saved money religiously. And he was very frugal as well: he never went into debt for anything, drove cars till well after they fell apart, had clothing that I know was older than I which he wore till the day he died.
One of his great loves, though, was to steal things from the hospitals he worked at. Anything that wasn't bolted down - office supplies, filing cabinets, tables, chairs, desk lamps. At one point, he was bringing home hard boiled eggs that he pocketed in the staff room, because obviously we couldn't afford food. Several times when we were doing remodeling at home, I got to keep a lookout for security while we snuck bags of construction waste into the dumpsters at work.
Now, you didn't know the guy so it might not be obvious, but this was all about not spending a cent more than he had to. So, don't feel ashamed because some of your fellow country men are taking soda from work.
I don't think this has nothing to do with nationality. I work in a MNC in India and we have free sodas. I have never seen any one raid the soda at the end of the day. In fact there are lot of sodas left at the end of the day even though they stock only as much required for one day of consumption. Bottom line there are ass holes everywhere, nothing to do with nationality or race.
I find it seriously backwards that no one had the spine to walk up to the person, talk with him about courtesy, cultural norms, and basically use "implied shame" to do the rest. If the behavior continued, a more direct approach "I saw you take the sodas last night" could also suffice.
I mean, why would putting a suitcase full of sodas == sabotaging product? It's pathological behavior in the over-abundance environment, but seriously?
It's generally not considered Googley to smuggle soda out of the office. Nobody will stop you because Google by-and-large trusts their employees, but I've heard coworkers complain about people who take home food from the microkitchens, and I've gotten friendly ribbing when I brought a microkitchen soda to an off-site where everyone else was drinking beer (which I don't drink).
Not so much in Seattle, but in MTV people seemed to raid the MKs on their way out of the office. It felt like some sort of communal effort to ensure that the next day's stock would all be fresh.
I think this may have been one of those cultural changes that happens when you double the size of the company in 2 years and norms are not explicitly stated...
I started as a Noogler in 2009 and my original cubemate was a pre-IPO Googler who started around 2002. I asked him what some of the biggest changes have been since he started, and he said that there was less of a feeling of community and more of one of entitlement. The snacks in the microkitchen was a specific example he used, that in the beginning everyone understood they were for office use only but around 2006-2007 he started to see people stockpiling them.
More generally - the perks you get as a Googler are not because you were so awesome that Google decided to hire you. They're there to build a sense of community and common purpose. General guideline for when something's okay: Are you in this together with your coworkers, or are you in it alone?
As others suspected, and partially confirmed above, someone was abusing the free soda, by taking significant quantities of it home. If Microsoft has to refill their fridges every day because someone takes home all of the extra soda at the end of the day, is this supposed to be 'part of the culture?'
If someone is rolling out suitcases full of soda, it might not warrant removing the free soda perk, but it definitely warrants calling attention to it, and finding out who is doing it (and possibly giving them the boot).
Its even worse at Microsoft China: they empty fridges after 6 PM or so, and they never stock them very fully. So if you work at night or on the weekend, you are pretty much SOL on anything but hot or luke warm water (its a Chinese thing, I would kill for a water cooler), or taking a 10 minute walk to the nearest convenience store outside the building. Suffice it to say, I never overtime at the office, its just too much of a logistical nightmare if I get thirsty.
But I guess they did have a big theft problem N years ago that justifies this behavior. It wouldn't surprise me at all if this would be a real problem.
What's the difference? Or rather, what do you mean by Chai? As far as I know, that's just a different word for tea. I guess you might mean some drink that has milk?
For what it's worth, I bring in my own leaves to the office.
OK, I was just asking, because Chai is also e.g. the Turkish word for tea. (I guess it's just that some cultures we use the chai-based word for tea instead of the tea-based word use more milk. In Mongolio it's chai as well, and they have lots of milk and butter and salt and pepper.)
As a former contractor, I saw the occasional bag full of milk cartons. I find it weird. I don't think it's worth a crackdown or treating the employees like babies, though.
It is true that no matter how much you pay a person, they can still be cheap and "exploit" a resource. I don't think it's important enough to worry about on the whole.
It sounds to me like you're suggesting that this sign went up because somebody took a single Diet Mountain Dew home. I strongly suspect that some joker took a case of Diet Mountain Dew home and said "what!? they're free!" when he or she was caught. And I don't think you're suggesting that it's okay to take a case of soda from work.
It's a software company, after all, not a grocery store.
I'm curious what the dividing line is. I don't think taking a drink or even two with you for the drive home is particularly bad (I've certainly done it when visiting various places). Cases of soda for home, bad. Office supplies which are used for work at home, probably fine, but could look bad.
From checking into this more -- one of the other issues is tax treatment (at least in the US). It's favorable to give employees free food/drinks at work. If you're giving people stuff to take home, it potentially becomes a taxable benefit. Feeding people for benefit of employer outside work is partially taxable. So, even if you had a tacit understanding with employees of "we buy soda in huge quantities, so take as much as you want home, and we'll just reduce salaries by approximately the amount taken home", you'd have a problem. (which is absurd for soda, but I'd be fine with making $2-5k/yr less if I got to fill up my car at a work-provided gas pump, which is analogous).
In my perhaps limited experience, people rarely ride the line. As they get away with things, they get more brazen, so there turns out not to be much middle ground in practice between the OK "one for the road" and carting things out by the case.
It's also often the case that most participants are playing fair, but there are one or two who step way over the line.
A friend of mine used to work in a place selling baked goods. One of the perks was that if there were any cookies left over at the end of a shift then the staff could take some before the batch got dumped. This went on happily for years until one day an email came in from head-office, stating that all food was to be dumped at the end, no freebies, etc. turned out that a manager at another store had been deliberately baking up huge batches of food to be taken home at the end of the night (think a few crates of cookies to cover the neighbours kids birthday that weekend), far beyond what had been considered fair game by the company.
These kinds of perks always seem to get ruined by that one idiot who goes overboard.
This was how we lost a discount on GE appliances at Microsoft; too many employees buying and flipping the appliances. Same thing with our (super sweet) video card discounts; 75% off video cards straight from nVidia lasted about six months.
I don't understand that reaction, one person did it so EVERYONE must be punished? Why not simply fire the person, charge them with theft, and sue them to recover costs making an example of them for anyone else who may consider doing it?
Jack Welch called it the corporate immune system. Once you've been hurt, you tend to over-bureaucratize the response to ensure that it never happens again. I think it has to do with the fact that human psychology tends to over-value possible negative outcomes vs. possible positive outcomes, as well as a certain amount of future discounting, plus social signaling to show the problem is being taken seriously: you put a stop to the very visible, very current, negative event with little regard for a possible, future, positive loss due to bureaucratic build-up.
It's irrational, but so is most management in practice.
The line is almost always one of quantity, but there are other rules.
(1) Will it cause a substantial loss/burden if everyone did what I'm doing. Everyone taking a case of soda home regularly would be a pretty huge burden. Everyone taking a can or two home every once in a while would not. You can apply that to pens, a pad of post-it notes, etc.
(2) Would I be embarrassed if someone saw me taking this item home and knew it was for my personal use. Generally, if you feel like you have to hide that behavior, that's a good point to stop and ask "why". You may not always come back with "I shouldn't do it" but you probably will most of the time.
(3) Assuming the first two aren't true, would my usage of the item embarrass my employer to their customers. This probably doesn't apply to the soda thief but does apply to a lot of other decisions of this nature. The best example I can think is "I ran out of paper, so I'll just use company letterhead to advocate people attend the annual KKK rally at city hall". I'm sure there's less extreme examples, but absurdity goes a long way toward making a point.
As for office supplies which are used for work at home, I'm guessing you mean more than just pens and paper. If the total take is over $20, I'd probably ask permission, but I've never been in this situation. My office supply is my laptop and these were officially given to me for work (and must be returned when I'm done working there), everything else I already have at home.
And hence the issue. Those that take advantage of a system never feel that they are.
Look at why it is provided. It's not a prize or a bonus. It is to keep you happy and productive while you work. The company feels that is worth the cost. Where in there does someone drinking soda on the way home figure? It doesn't.
If I were the person providing the free soda I would be upset at being taken advantage of.
Finishing your soda on the way home, sure. Grabbing an unopened one and walking out the door... that seems to me to be a good place to draw a line.
I would draw the line a little further away than a drink for the ride home, or even taking one or two drinks home with me for the drive the next morning. It's in their best interests if you make it to and from work happily and safely. If a drink makes the commute easier, it's worth it.
As an example, I asked my employer if I could borrow my steel toed boots meant for site visits to use during some work outside to help a friend for a weekend. I told them if I damaged them I would gladly pay to replace them. My boss told me that they would lose much more value from me missing work injured than those boots would cost to replace, so not to worry about it and then gave me a fatherly lecture about being safe using a chainsaw before digging out safety glasses to send with me.
It's hard to make a bright line for abuse, but for a general rule I won't take anything or take advantage of anything I wouldn't pay for myself without asking ahead of time.
I'd say that grabbing an unopened one on the way out the door is in the grey area, but more than that definitely goes past the line. And frankly, if people were grabbing an unopened soda (that probably costs the company 25 - 75 cents) on the way out, nobody would notice or care. If the company is 'cracking down' on these single-soda offences, then it's probably just as good an indicator of things going downhill as the removal of the 'free soda' perk altogether.
I'm not sure why "carrying one out" is the line here. Surely it's better to have an employee carry out one soda a day, than to have the same employee drink six sodas every day at the office?
Personally I stick to water because HFCS is bad for you.
The strategy somewhere (google?) where they charge or otherwise disincent consumption of unhealthy food and encourage healthy food is kind of interesting.
My beverage of choice is Ito-En bottled green tea. I'd prefer if it came in glass vs. plastic bottles, though, and it is $1/bottle even at Costco, so at home or office I tend to just make my own using either matcha teabags (also from costco) or looseleaf green tea.
Going back to the topic of expense to the company - healthier foods are also generally more expensive than junk food. But if you think it's worthwhile to keep employees at optimal performance, it's a small price to pay...
Define smuggling. If I pick up a soda when leaving the office, I don't think I'm doing anything wrong. If I start taking boxes, that might be an issue.
I think we both know that's not the situation at hand. Even Microsoft isn't going to go around writing HR nonsense about the occasional soda taken home.
Really, this attitude is precisely the problem. You're looking at this as a confrontation from the start. Perks like this only work if they're offered and accepted in good faith. If you don't trust your employer to interpret your soda consumption charitably, your employer is getting no benefit from offering it.
Basically, if you want your employer to offer snacks and soda, be grateful about it and don't look for trouble.
> Even Microsoft isn't going to go around writing HR nonsense about the occasional soda taken home.
Well, if they're spending millions on it in general then many employees taking 1 or 2 home every day is actually probably a much greater financial 'burden' on them than a handful of employees taking entire flats every now and then.
And you also don't tend to put up signs like that unless your goal is to change everyone's behaviour.
> And you also don't tend to put up signs like that unless your goal is to change everyone's behaviour.
Yes, "you" do. You specificaly may not do that, probably most people around here will not do that, but lots and lots of people do, enough so that most signs are put down by this kind of people.
And yet if those employees wanted soda, what's another truck out of what must be hundreds already, coming to the company? Yes, it'd be 90k * 2 * the rock-bottom wholesale price of a can of pop, but if your employees want it and it saves them time in their salaried day, it's likely worth it.
Those 90,000 employees cost about $45M a day to employ, $35k on drinks is meaningless. Especially against the PR disaster of a thread full of potential employees hearing you hide the soda at night.
But, as someone said, if someone is stealing from you and views it that way you should deal with them personally, directly, and immediately. Passive-aggressively hiding soda is only going to make them switch to office supplies, if you're lucky.
Only an extreme level of soda-stealing would be an actual financial problem, but I agree that the office culture would be the real issue.
It's the same with any perk. Flexible schedules are nice, but not if people don't work at all. An equipment budget is nice, but not if people use it to buy stuff for their friends.
If my teammates were dishonest like this, I'd feel uncomfortable working with them. But in any case, I much prefer that those individuals be confronted than that the perk be taken away from everyone.
Right. If my co-worker has no problem stealing hundreds of dollars or more a week of stuff, perhaps they have no problem stealing from me, my backpack, or my wallet.
Even more important for the company, such a person shouldn't be trusted with SSH access, database access, etc. Another reason to fire them rather than penalize everyone.
Yeah, I worked at a small company where someone was taking boxes of snacks home. It's quite noticeable and managers can't keep up with that, nor can they really guard it.
How about this. I'll kick in $10-20 a month (how much does a soda can cost in bulk, 25 cents?), you don't ruin morale because someone is "smuggling" soda out of the office.
If I catch you walking out with a case of soda unpunished, my morale is already "ruined" and that $20 is just an insult. That's not how you see things? Too bad. Morale is subjective.
The point here, which you missed, is that all these perks only work if everyone plays by a sane set of rules and doesn't try to stretch things to their advantage. Having free soda is fine. Playing games with what you're allowed to get away with wrecks things for all of us even if you never get punished.
But if they do catch the person taking the soda, is that the kind of person that you want working with you? Maybe it depends for you, but some people would be uncomfortable with that.
I've worked with psychopaths. Like, straight up would slaughter you in your sleep for your last dollar. So yeah, smuggling pop? I couldn't give less fucks.
And if you were working with clones of yourself, that would be a sensible argument. As it is, we're talking about the workplace as a whole. And dismissing the people who give more fucks as "whiners" is hardly helping. Basically: you're part of the problem, and one of the reasons companies find it hard to offer perks like this.
Cans of soda. That's what we're arguing about. Its a rounding error on a balance sheet. If you can't offer perks because you're worried you're going to lose less than what a decent cellphone plan for 1 person costs monthly, find somewhere else to work than tech. People are people, and getting bent out of shape over soda is insane.
I've heard stories of long internal flamewars over this. Apparently loading a case of free bottled water into the trunk of your car is not very "Googly".
That's how the free pop at RIM ended. The story I heard is that Mike L saw an employee loading flats of coke into the trunk of their car one day, and the free pop ended shortly after that.
That's interesting. The story here is always "taking away free sodas is just an indicator that things are screwed up and the company has lost its way." I wonder if it actually goes one step deeper -- the fact that employees are willing or feel justified in lifting flats of free soda is the first indicator that the company is screwed; taking away free drinks is just the more visible manifestation of that.
> I wonder if it actually goes one step deeper -- the fact that employees are willing or feel justified in lifting flats of free soda is the first indicator that the company is screwed
I would guess it's got more to do with size than anything else.
When you're in a startup with 50 people and you know the guy who orders the office groceries by name, very few people would start taking home crates of soda. Such an act would have observable consequences (no soda for your team-mates, or office grocery bill goes up very noticeably and you feel like you're ripping off everyone else).
If you work in an office building of 5,000 people, taking home crates of soda doesn't have observable consequences in the same way. Perhaps the office grocery bill goes up 0.5% or one of your teammates has to walk 20 yards to the next fridge over to grab a soda, but from your perspective the effects are marginally indistinguishable from 0. It becomes "wrong" in abstract principle rather than "wrong" in observable effects.
>the fact that employees are willing or feel justified in lifting flats of free soda is the first indicator that the company is screwed
Interesting theory but the major flaw I see is that the Employee Is Not Always Right. Often times, you get someone who is just a Jerk. Such people often think along the lines of, "Free soda is a perk, there is no explicit rule limiting the amount of soda I can use so I am within my rights to take as much as I can carry."
I wonder what the fraction of such people is, in an average company.
I've encountered people before whose feeling is "if there's no written rule against it, I'm entitled to do it." Is the best solution to the "soda problem" just to fire those people and be done with it? I'm sure they take liberties with more than just sodas.
Certainly seems like. My reaction to someone loading boxes of company soda into his car is not to take away free soda, but rather fire the malefactor (perhaps after giving him a warning for the first incident). Maybe a bit harsh, but on the other hand, the guy is stealing company property.
It seems like a good solution to someone abusing this system would be to call them out on it. It stops because of social pressure (hopefully) and you don't have to take away everybody's fun. Something like an email that reads "We noticed Jim Jenkins hauling out a case of pop last week. This is not acceptable. Don't abuse the system so we can continue to have nice things. Thanks."
People's behavior is also partially a function of their environment. I know that in poisonous workplaces, I've developed bad habits; perhaps if people are boosting soda sufficient to cause alarms to go off, an audit of how they're being treated is a worthwhile place to start?
>I wonder what the fraction of such people is, in an average company
As all things, it depends on the type of position. In a hospital, it's probably not common for surgeons to be hauling Pepsi out to their car every day. In a call center, you'll probably get close to 80% of people that would abuse such a privilege based on my first-hand experience.
>Is the best solution to the "soda problem" just to fire those people and be done with it? I'm sure they take liberties with more than just sodas.
I think this is an excellent point. I think that personality defects like abusing privileges is one of many variables to consider in hiring, promoting and firing. As you said, if someone is spending their time scheming on saving a few dollars per week then they have serious moral as well as priorities issues.
>"if there's no written rule against it, I'm entitled to do it."
This is a variation on "it's better to ask for forgiveness than permission", a disappointingly common point of view within the tech and startup communities.
It's better to ask for forgiveness than permission
I use this statement somewhat regularly, though the simplicity of the statement makes it confusing.
Acceptable: My son and I were at a grocery store. He started complaining about his stomach and had thrown up several hours prior. I knew the bathroom at this store was located in an employees-only area. I also knew that one of the managers was a jerk. I could take him to the toilet to discretely regurgitate or ask the manager, risk getting turned down (or just in the time it would take, risk not making it in time) or just walk right past the sign and prevent him from projectile vomiting in the aisle. That was the first phrase I thought of, and I bolted.
On the flip side, if I'm on a White House tour and am told that I must stay with the tour group at all times, I'll be sticking with the tour group at all times, thanks.
In the context of tech companies, I recall a talk Scott Hanselman gave (very paraphrased) where he said he decided one night to just setup a site for Visual Studio fan art (I think he used Tumblr) which he later shared with his boss and was received very positively. He knew if he had proposed the idea that fifteen departments, thousands of dollars and several weeks would be involved (should we really use Tumblr? would corporate branding be upset? Don't forget to run it by legal! What if someone makes porn of it!). Corporate policy (asking permission) wasn't followed, but the result was infinitely better than if the process was followed and I, personally, loved the site.
I'll admit, though, that the line between overstepping with this thinking and doing something very wrong can be very, very, hazy and can land you in serious trouble (often legally).
Whats worrying is that people are using that as an excuse to "get things done" that shouldn't ever have been started in the first place. The permission givers are more often than not there for a reason, and more often then not they are saying no for a reason.
Compliance is amazingly important because getting it wrong can virtually end your company, yet developers get annoyed when the project they are on is delayed as PCI compliance is checked.. etc. The moment they take the "ask forgiveness" approach they put the company at risk of a serious fine, or worse, company limiting restrictions. [Check Path out for an example].
To everybody that has used this mantra: If you don't understand exactly why you are being blocked by the "permission givers" then don't assume that they will freely give forgiveness when you royally screw something up.
That's because asking forgiveness rather than permission is a good way of actually getting things done, rather than having everything blocked by permission-givers.
As long as you're not being a dick, forgiveness beats permission any day.
Only if you understand the impact of the decision you are making. Most people that use this mantra don't!
Its one thing when its "Tony is out of town, I will borrow his lawn mower and ask for permission later." Its completely different when you don't understand the implications of the thing you are doing.
I have been the "permission granter" thousands of times where permission couldn't be granted due to everything from in feasibility of the request [There are not that many widgets to give], prioritization [its not worth taking from the main product to feet your pet project], compliance [doing what you want will get us fined], to flat out legality.
Developers with this attitude RARELY understand the implications, even in a company of 20 people. They assume that they are getting things done but really they are just moving the problem to a team further down the stack.
Within a company, going around a permission giver is almost always a good way to be labeled a "dick" by the people cleaning up after you.
A person who always follows the "ask permission" strategy ends up with an ingrained unconscious belief that most things they could do are ultimately bad ideas. They end up limiting themselves and only taking actions that are safe, uncontroversial, and unlikely to result in a "no".
A person who always follows the "ask forgiveness" strategy will end up getting slapped down a few times and occasionally get a reputation as a dick and have to find new people to work with. But over time, he'll learn a good intuitive sense of both what the limits are (because he's broken them so many times) and why the limits are there (because he's seen the consequences of breaking them).
All this means that eventually, the person who asked forgiveness a whole lot eventually ends up being the "permission granter". Eventually he ends up taking an opportunity that the "ask permission" folks deemed was too risky and it works out, and people remember the one huge success more than the dozens of minor messes.
So while you may be justified in labeling the "ask forgiveness" guy a dick, that won't stop him from replacing you. Life is sometimes unfair, and assholes sometimes win.
I see the other pattern - the forgiveness guy grows a rep as the guy who broke stuff, while the "ask permission" guy often finds out people say "yes". The end result is people are happier working with the ask permission guy.
Asking forgiveness entails taking a personal risk. If it works out, you're wonderful. If it doesn't work out, you have to answer for your bad judgment.
Asking permission is a way of hedging against your own judgment. In other words, it's a great thing to do when you're genuinely not sure. But if you are right, you don't get results as efficiently, since you have to let everyone bikeshed first. Maybe you don't even get results at all.
I find another pattern works well. You ask permission for ridiculous things, in order to focus other people on what you want to do and how they can help.
It's really simple. Don't open with what you want to do, open with what you'd like to get, and make sure that you're mentioning 2 or 3 things you're willing to give up. Don't say "I want to write a complex mobile app for the delivery department", say "I need a $200k to hire 2 programmers, buy 30 different phones, and 6 months of nothing on my plate, you got 15 minutes ?".
Obviously, you do this once every 6 months or so at most, preferably less, and follow through.
It's amazing, especially in America, how mentioning dollar amounts focuses people on solving problems and looking at opportunities instead of looking for excuses. Finding excuses is universal in organizations, especially big ones, and the higher ups have as much trouble with it at the cleaning lady. Plus, the fact that you even know how much to ask and have a plan for the negotiation means you have built a business case (don't go in without one).
Obviously if you're doing something with compliance/legality/security implications it's worth asking permission. And obviously, you should build processes around those areas in your company. But healthy companies also heavily encourage individual initiative to achieve results rather than relying on top-down command-and-control. If you're a startup, it's doubly important because you just don't have enough people to set up a bureaucracy of permission-givers.
If your employees don't have the judgment to know when to ask for forgiveness rather than permission, fire them and hire people who do have good judgment. Don't use process to protect yourself from hiring bozos. Just don't hire bozos.
Much of the time you should ask forgiveness rather than permission, you're not really required to ask permission in the first place and you just end up creating useless bikeshedding discussions. If there's a process that requires you to ask permission, and the process is genuinely important, it's a different matter.
It's worth noting that the first person to say "it's easier to ask forgiveness than to get permission" was Grace Hopper, who not only wrote the first compiler, but served for four decades in the Navy. So you can accomplish a lot of things and still somehow not get fired from even stodgy bureaucratic institutions with this mentality.
I'm sorry you've had to work with a lot of dicks and bozos. I had a coworker like that once too. Had. I've used, and seen used, "forgiveness before permission" many times in my career and aside from that guy it always worked out.
Maybe. I have certainly had moments where this seemed appropriate. But everyone has flaws and blind spots. It's far too easy to be blind to your own mistakes and to rationalize unsavory behavior.
I think that's a factor of people being assholes. I've worked in places large and small, public and private sectors.
There's always an idiot who will do something that ruins things for others. In one case I was exposed to, it was an attorney making north of $150k stealing change from people's desks, and trying to frame the cleaning crew. In another, it was a person taking advantage of time & attendance rules. In another, it was a guy pilfering silverware from the lunchroom.
It could be racism, in the case that the cleaners are of an ethnicity the attorney despises.
It could be bullying, in the case that the people whose change he is stealing deliberately leave cash in their desks for paying vending machines, or because they know they are prone to leaving their wallets at home.
It could be that he was so well off that he couldn't see the problem with taking a few dollars from a desk to pay a parking meter or whatever; then became embarrassed when confronted.
Feelings of wealth vs poverty are not absolute. If the attorney has an expensive plastic surgery habit, all his friends are on $500K, and he can only afford two trips to Klosters this year because his yacht needs servicing; the money may have utility to him in an "every little helps" kind of way. He might feel that everyone else is better off than he is.
If this is a big office, you could probably make $100-$200 in a session of theft (I know there is normally at least £15 in desks in my office of 8 people). If his salary is paid into a joint account, and he wants to pay for something without the knowledge of his partner (e.g. charlie and hookers), then stealing cash might be the easiest way he can see to conceal this spending.
I'm sure every 'asshole' will sooner or later be diagnosed, at least in US. Might as well declassify every diagnosis not related to obvious physical damage back to the level of 'assholes needing cultural education'.
That's a really interesting point, actually. Though I should mention that the free pop ended long before RIM hit their peak. It was gone by 2007 (along with the Wednesday movie nights), but I don't know exactly when either of those ended.
I think a good approach would be to immediately tell the employee that this is stealing and a fireable offence. Either fire them, or give them a warning.
That is much better than punishing everyone for the crimes of one (or some).
The employee who is carting out cases of free drinks is also the employee who will sue you for wrongful termination because the drinks were free and there were no guidelines to the contrary.
The right thing to do is either to have a quiet, informal chat with the employee in question (if you know who they are) or to send a broader message with the appropriate chagrin ("We wish we didn't have to send this email, but...").
So in an argument about following both the letter and spirit of an agreement (e.g., free drink perks), the solution is to be underhanded about why they're being fired?
Playing devil's advocate, I know. Statistically, the guy carting cases of Coke out the back door is probably doing more than just that.
Honestly, I think after reading this thread, I am set on offering free perks like this when I start a business just so that I can see who would engage in this type of behavior and fire them. I think the qualities that would lead you to blatantly steal something provided for free as a convenience by your employer would also lead a person to be the kind of callous, selfish team member that no one enjoys working with.
Its so hard to believe that someone like that would be allowed to keep their job after such an incident that I think the story is false. It was a made up (or exaggerated) excuse to justify the removal of the free soda.
My experience at Microsoft was having a fellow FTE loading up a cooler full of "free drinks" and shopping bags of kitchen supplies to use at home, then make weak excuses when asked WTF he was doing.
RedWest was kind of like,"Not really Microsoft" to those of us on the main campus. You were closer to Nintendo than you were to us. :-)
I remember taking the campus bus there not long after it opened and it was a much different world. It was a very clear sign that MSFT had become a "big" company. Passing dozens of "Herbalife" signs on the way just reinforced that.
The biggest "cost" issue we had was a) don't print if you don't have to, and b) if you have to, use the back side of previously printed paper. That was more environmental-green vs financial-green, though.
Then I went to Amazon, and it was a whole new world of getting no perks whatsoever. Non-adjustable "desks", the slowest development machines possible, and a bunch of false economies around operations and infrastructure.
That's possibly true. However, having had the experience of someone show up to a disciplinary meeting to argue that he couldn't be sacked for spending hours a week looking at porn on his work computer, because there wasn't a specific line item in the workplace manuals or codes of conduct saying so, you'd be surprised at what people will argue to avoid getting fired when they're doing something anyone without some serious mental or moral impairment would recognise as not OK.
Or, to put it another way, every bizarre rule or sign usually has a story behind it.
I've seen such things happen, and I almost universally blame the founders and top level leadership when this kind of thing happens.
Dedicated CFOs and accounting types are simply doing their job. Their singular focus is often the bottom line and the company's financial health. It's not their job to maintain, foster, or enhance company culture. That is the job of the CEO.
In situations like this, it's the CEO's responsibility to make statements like "there are intangible benefits to free snacks and sodas. Small things like that help people that make money for the company stay focused longer and help them get through their day."
Help the accountants understand where the cost cutting boundaries are early, so you don't have to micromanage every decision they make later on. Over time they'll start to "get it" with your culture and they'll focus their attention on real problems like getting financing, making sure invoices are paid, setting up M&A deals, etc that they were hired to do.
I'd strongly disagree that it's not the CFO's job to foster and enhance company culture. If your CFO is a cost-cutting machine, I hope he's not highly compensated. Any qualified first-year accountant can do that job.
It's a good CFO's job to make sure that resources are invested strategically. Indeed, it's every executive's job to work together towards a shared vision and goal. If someone is working towards a different goal, you're inviting unnecessary conflict. No one should need to be micromanaged - at any point - if they share the goal and the culture along with the rest of the employees.
When you bring in an outside CFO, chances are that you're getting a highly paid individual whose main incentive is to increase the valuation of your company to make it look good for an acquisition, increasing revenues substantially, or going public.
Cost cutting is just one tool in their toolbelt to work towards it. But it's the sharpest and most easily understood tool they have so that's why they will reach for it so often.
In an ideal world, you'll get a CFO that totally jives with you culturally, accepts a lower salary (or limited equity stake), and just handles all the paperwork. But such people will rarely carry the title of CFO.
> "In an ideal world, you'll get a CFO that totally jives with you culturally, accepts a lower salary (or limited equity stake), and just handles all the paperwork."
Again, I have to disagree. Ideally you get a proactive CFO who understands the value of the company culture, and works to encourage it. Yes, even if that costs more money. A paper pusher who stays out of your way does not approach the value of a good CFO who gets what the company is about and what they're trying to do.
Anyone who hires a paper-pushing-bean-counting CFO should not be surprised when that CFO tries to sacrifice long-term success for short-term balance sheet exhibition.
> Anyone who hires a paper-pushing-bean-counting CFO should not be surprised when that CFO tries to sacrifice long-term success for short-term balance sheet exhibition.
This is the point. You are not to be surprised, but as CEO be ready that your CFO will require guidance while doing otherwise useful things.
Should a CFO be singularly focused on bean counting to the detriment of company culture? No.
Is that often the reality when you bring in an outsider as CFO well after your company culture is established? Yes.
CEOs just need to be aware of this fact and work closely with any outsider who gets hired into a CFO position in their first 6 months on the job to make sure that all interests are aligned. It would be great to find someone up front that totally gets it and is willing to be a dedicated CFO, but I think such individuals are extremely hard to find.
The sad fact is, many CEOs only bring in a CFO when they're trying to find a way to cash out. Company culture usually takes a back seat at that point.
I couldn't agree more. People complain that non technical people don't understand or value everything that goes in to our work other than 'writing code' -- look around, you are probably doing the same for other roles as well, including your 'bean-counters'.
I remember hearing the joke about "How do you make a startup profitable? Fire the CFO" because over-paid outside hired executives are bad for company culture.
The case I heard about, the CFO was was fixated on hassling people over business lunch costs (meeting with industry contacts etc.), and not creating value or the company or preparing the company for larger investors etc.
That's not how things work in reality. Look at the original post. The CFO was handling compliance with all sorts of insane regulatory minefields, the kind where a mistake can lead to the government destroying your company. No, a first-year accountant can not do that job.
But different jobs require different sets of cognitive biases. The ability to handle the regulatory compliance is very unlikely to reside in the same brain as the ability to understand that cutting small perks costs more in morale than it saves on the budget, so if the CEO isn't keeping the CFO on a leash, the CEO is not doing his job.
I remember being told that one of the CEO's of British Telecom is said to have said to his CFO "thank you for telling me what the cost of things are but I know the value of them"
Ironically BT a huge company started to go towards free tea and coffee but this was stopped by HMRC (the taxman) who wanted to charge tax on this benefit in kind - and you think the IRS is bad.
I think you might be confusing the fact that [non luxury] food and drink are [generally] zero-rated for VAT purposes with the assessment of a value for food and drink provided as a "benefit in kind" for income tax and NICs purposes.
>An employer may provide its employees with access in the workplace to tea, coffee or water from a cooling dispenser. If this refreshment is available generally to all employees, the benefit is exempt from charge (EIM21670). If the exemption does not apply, you should accept that these refreshments represent a trivial benefit." //
But it very much depends on how the benefit is provided, voucher schemes work differently and there is an assessment of the value of the benefit involved.
No, I'm not confusing anything, I'm not talking about VAT at all. I'm talking about the pretty explicit guidance on the page I linked. And rather ironically on the pages you linked. No income tax to pay on the benefit.
Read the parent I replied to. He was claiming HMRC was trying to get BT to charge income tax for a benefit of tea and coffee.
I challenged it because I was interested if this was ever true and also it's never good to let rumours like this to exist, the UK is a great place to start a business and misinformation like this shouldn't go unchallenged.
>He was claiming HMRC was trying to get BT to charge income tax for a benefit of tea and coffee. //
The page I linked says that it's not normally the case. But it's clear in the guidance that a not unusual construction of such a scheme, eg using vouchers and an external provider, would make it that tax/NICs were due on the hot-drinks a a benefit-in-kind.
It's not provably misinformation but it is deficient and doesn't demonstrate the verity of the claim.
I hate this fucking excuse, and I killed it in my current company because it leads to administrative overhead and all kinds of bullshit discussions about who contributes how much, just to save a few bucks.
Yes, the company has to pay tax over the free food we give our employees because it's considered part of their pay. In the grand scheme of things: big fucking deal.
It's cool in a larger company where you have a well-stocked cafeteria where you can buy good food at heavily subsidized prices.
But in small companies this micro bean counter attitude in order to avoid taxes is actually more demotivating and divisive than not providing free food at all. Especially if you're in the middle of the city and people have dozens of options to go out for lunch.
Then you'll need to track exact value of food each employee spent, send them invoice and pay them the same amount each month to cover that amount. I can't see how that can be simpler than "free food".
I saw the letter on company letter head so I doubt HR/IR was lying - the cost of being found out woudl have been to great.
And HMRC have form in this area when the company had a high level query about some thing they wanted to implement HMRC said no - So the CFO implemented profit related pay which reduced the tax take as a fuck you to the taxman.
They really should be taxed in the US, too. They are compensation.
The IRS has a guideline that says (not exact words) "if it's too petty to keep track of, like someone using the Xerox machine for personal use, don't worry about it." Free cans of soda probably fall in that petty category.
Here in Brazil such kinds of compensation are explicitly non-taxable. The employer can even give it in an specific moretary instrument (not money, but something traceable), and won't pay taxes over it.
I'll disagree that a CFO shouldn't have insight into company culture.
I think the problem with CFOs in general is they are just ledger monkeys - there's red ink and black ink. Development is always in the red even though it's the place where the real value is derived. So bonuses are an extraneous cost, food is an extraneous cost, healthcare is an extraneous cost. If you don't have a CFO who realizes that simple cuts to development, and all employees in general, will affect the black ink down the line, then you are in trouble.
>Dedicated CFOs and accounting types are simply doing their job. Their singular focus is often the bottom line and the company's financial health.
I disagree that anyone in a corporation should have a "singular focus". As an IT person at an investment bank I've seen numerous times IT people just "do what they're told to do" rather than offer a true consultative relationship to the business. A truly successful person realizes their limitations but offers reasonable suggestions on things that other people may have missed.
I used to work at publicly traded insurance companies and there was often a marketing vs. underwriting struggle but nobody on either side ever had a "singular focus" because it's the lazy way to bankruptcy for the corporation.
My wife was a software engineer at a very big company (Fortune 50 / Dow Jones Industrial). At one point they decided to take the water coolers out of several buildings -- a move estimated to save half a million dollars a year. But one top-notch software engineer adds a lot more than that to the company's bottom line, so the move can very quickly become value-subtracting if it pushes someone over the edge to "I'm going to go to [competitor]" or "I'm going to go become a contractor".
Even if they don't leave, there's a morale penalty applied every day when someone walks past where there used to be refreshments, and has to keep walking another 30 feet to the water fountain or vending machine.
If there's one thing every company should understand about software, it's that top-notch people operating at high levels of morale are great for your bottom line. Being cheap about things like refreshments and office equipment ("you have to buy your own second monitor") is a morale killer.
It occurs to me that it's not just about morale and retention. Refreshment sites are also where people communicate. So I wonder how many dollars someone in the company was paying management consultants to foster better internal communication when someone else pulled out the water coolers!
The place I work understands this. We have a company-wide lunch every week (not every day), and the intention is to get people together who wouldn't ordinarily be talking.
It seems to work. I try to sit with new people then, rather than with my immediate cow-orkers, and I usually learn interesting things.
I work for a small company looking for a more space. When the president asked what one thing I would request from a new office space my answer was a dedicated place to sit and eat. What we lose by not socializing and chatting about projects is immense. And standing in the hall or in our small kitchen can really be a disruptor.
"there's a morale penalty applied every day when someone walks past where there used to be refreshments, and has to keep walking another 30 feet to the water fountain or vending machine."
True, but there's a measurable labor cost. My dept bathroom is at least 300 feet away. (You'd think that would be a building code violation or something). Anyway its a good extra 2 or 3 minutes of walking per visit. Lets say I stretch my legs 4 times per day. Thats perhaps 6 minutes per day for me, but in a 20 person department that's 2 developer hours per day.
Lets say 2 hrs/day * $50/hr * 5 days/week * 52 weeks/yr = 26 grand per year. Remodeling to put a door in the wall to cut 2 minutes off the walk via a direct route might cost $5K, only 10 weeks till pure profit for the company.
From a health standpoint I get up and walk every couple hours (no interest in experiencing leg embolisms or whatever, plus plain ole health reasons) so this wouldn't actually work, I'd just find another way to walk for about 1 minute every hour. But it shows the math is pretty fuzzy.
In your situation the cooler situation was "several" and 500K/yr. Either you were getting overcharged or we're talking about more like 50, not "several". I live in an area where we have more fresh water than we know what to do with, I know its not like that out west, so I could see costs being a little higher, but not like Frank Herbert "Dune" level. Anyway from a purely financial standpoint I'm not sure in your example that they're actually saving even one penny of money.
I'm not sure you can really do this kind of math when it comes to knowledge/creative work. One could argue that the 600 foot round-trip walk (vs a 60 ft walk), which is almost an eighth mile, contributes positively to your health and ability to concentrate by getting the blood flowing and boosting your seratonin and dopamine levels. I.e. the result of taking extra 3 minutes translates into higher $ productivity for the rest of the day.
> "Either you were getting overcharged or we're talking about more like 50, not "several""
I don't know the number of buildings, but I suppose "many" is more accurate than "several". The company had over 80,000 employees in the region, and worldwide revenue measured in the tens of billions.
Not surprisingly, there were some layoffs shortly after the water cooler cost-cutting debacle.
Assuming the $500K hydrated all 80K employees, that's over $6 per employee which sounds about right for bottled delivery.
You can buy a bottle-less cooler for about $400 but then you pay for filters and repair, or pay about $10/mo per cooler but they take care of everything.
So about right for bottles, a big high for bottle-less.
> If there's one thing every company should understand about software, it's that top-notch people operating at high levels of morale are great for your bottom line. Being cheap about things like refreshments and office equipment ("you have to buy your own second monitor") is a morale killer.
You write "in software" and I thought about whether that applies to other areas as well and I do think there is a universal truth concerning creative work. But then it reminded me of the discussion about manager bonuses in banking around 2008 (and there has been one, occasionally, ever since).
Now, in their case, we were talking about a constant stream of million dollar bonuses with the occasional hookers and blow. I guess the bottom line is: There are limits to what is sensible.
The company I'm with now recently started implementing "cost cutting measures." Coffee is no longer free (.50 cents per cup). Annoying, but not really a huge deal. You can pay once a month and get it out of the way instead of having to keep quarters on hand.
The bigger issue, to me, is that management decided to stop using a cleaning service. The 30-employee workforce is now part of a cleaning rotation. So, once a week, we are all expected to stop what we're doing and spend 30 minutes to 2 hours cleaning something, depending on our assigned area.
How can that possibly be cost efficient? You derail the thought processes of all 30 of your employees for at least a half hour every week. 15+ man hours that your highly skilled employees could be using elsewhere. In the case of the half-dozen programmers here, it's even less efficient. It takes a lot of concentration for me to get into a mental state conducive to good programming. 30+ minutes of cleaning is enough to get me out of that programming "mode", and it is very difficult to regain that state of mind once lost.
I think that's at least part of the reason why these progammers were so up in arms about the soda machine: Because now they have to think about it. The company has introduced an annoyance and distraction (I'll admit, a trivial one) into their work day, for very little apparent effect on the company's bottom line.
> I think that's at least part of the reason why these progammers were so up in arms about the soda machine: Because now they have to think about it.
You rise a very important point here. The benefit of free soda or food at work is not that employees can save money; it's that they don't have to think about food. It is abstracted away.
One of the reason those problems appear is probably the wrong mindset of management layer. They think of themselves as the bosses, while they should be thinking they're doing service jobs. Software companies sell software to make money. Software is made by developers (and designers), and sold by sales people. Anything else is support structure. Developer abstraction layer [0] to help translate software to money. But often the structure is inverted, and managers become "shit funnels" instead of "shit umbrellas" [1] - forcing developers to be concerned with things not related to developing. And then productivity declines and good devs leave.
There is nothing wrong with cleaning offices for a living. It's good, hard, honest work. But did you really bust your ass learning to program just to clean toilets so that somebody getting paid more than you can make the numbers on their spreadsheet look nicer?
There are good reasons for you to leave that situation. For one, the fact that your employer can't afford a cleaning service is a very bad omen. Secondly, programmers don't usually like being deprived of their programming like that, so even if your employer isn't about to go under, it's likely that some of your colleagues are planning their own exits. It's also almost certainly a departure from the job description you signed up for.
I have to admit, I am wondering why you're still working there. There must be some good mitigating circumstances, right?
> I have to admit, I am wondering why you're still working there.
Several reasons. These cost cutting measures are new, and I've been trying to decide whether they are a big enough reg flag for me to start getting serious about finding a new job (I've decided they are). Also, I have some personal life changes coming up in the next 6 months as well, and I'm hesitant to add a job change to those big personal life changes unless I have no choice.
> There must be some good mitigating circumstances, right?
Definitely. I like the team I'm working with, and other than the slightly ridiculous cost cutting, the work environment is remarkably low stress and friendly.
It can be cost effective if there is currently no way to fully monetize the full productivity of the team, and the company is trying to survive without lay-offs.
The only issue is that if you have a valuable workforce that has the option to leave instead of desperately needing the job, you need everyone's buy-in, or at least full understanding of the circumstances.
Apparently that hasn't been done, which is incredibly stupid, especially in such a relatively small company, but not uncommon.
A simple alternative would be to let one programmer go, and start hiring again when business picks up. However, once you go down that road, it's a lot harder to rebuild the team again. With that as the alternative, it shouldn't be too hard to sell, at least not in the short term.
50 cents per cup? That's gotta be with a profit even. Charging for coffee is not really acceptable to me. What I could see as fair is not providing unhealthy stuff like soda and snacks (because it creates unhealthy habits), but at least replace it with coffee, tea, fruits and nuts.
I'll clean my own desk, but make me clean the office and I'm out of there, unless it's a scrappy start-up in which case it's OK. I hope your company has many other redeeming qualities, cause they sure sound cheap!
If you don't set out to make a profit, you're probably going to have a loss. So, unless the true cost of a cup of coffee is below 25 cents (I don't think it makes much sense to charge in between, although I could be wrong), it's not necessarily unreasonable (ignoring all issues if that's a change from free coffee).
No. There's mixed evidence about whether coffee is moderately good/moderately bad/neutral for you in sane quantities (i.e. a few cups a day). There's plenty of evidence that eating salty/sugary sodas and snacks is bad for you in similar quantities.
Indeed. The ROI on providing coffee free of charge to employees has to be huge. All that (free) caffeine works wonders for helping people stay awake and productive.
We call that the "we're paying them anyway" fallacy. The idea is that once you've paid someone a salary, its a sunk cost so assigning them any extra task is "free".
The bigger issue, to me, is that management decided to stop using a cleaning service. The 30-employee workforce is now part of a cleaning rotation. So, once a week, we are all expected to stop what we're doing and spend 30 minutes to 2 hours cleaning something, depending on our assigned area.
Wow. You only clean (aside from desk clutter and kitchen spills) at work if:
(A) Your job is literally to be a full-time cleaner.
(B) You are a partner in the company (0.05% stock options don't count.)
Ask for (B)-- being a real owner means you do some of that unpleasant stuff-- but if that doesn't happen, then quit.
See, here's the thing: I'm actually pretty torn about whether I think the cleaning is an unreasonable request. On the surface, being asked to clean is not a big deal. I clean my bathroom at home, cleaning the one I use at work doesn't seem like a big deal. At the same time, as snooty as it sounds, my job is to write code, not to spray cleaner on a toilet bowl.
But it's what it says about the company that concerns me. It seems like they're saving pennies at the risk of employee happiness.
> On the surface, being asked to clean is not a big deal. I clean my bathroom at home...
You're tricking yourself into a false comparison here. It's your responsibility to clean up after yourself. You spill coffee in the break room, go get a paper towel and clean it up.
It's not your responsibility to clean for your company. Unless you applied to an unusual job posting, it never was. Vacuuming the hallways and scrubbing the office toilets is not cleaning up after yourself. It is cleaning up for your company.
> my job is to write code, not to spray cleaner on a toilet bowl.
There's nothing snooty about this. How do you think a janitor would react if their first day on the job they were sat down in a call center and told to answer phones?
Your company doesn't care about you and your job description has changed. Time to head for the exit.
EDIT: obviously if you're a partner in the company as Michael mentions things are different, but it certainly doesn't sound like you are.
Right; then what you describe sounds like nuclear-silo-klaxon warnings to me. If the decision-makers want to replace $x/hour janitors with $xx/hour developers, they probably understand neither the price nor value of anything.
Some deluded executives think that since developers aren't paid by the hour, their time is "free" (just tell the developers to work more hours per week to make up for the cleaning time). They'd never ask a consultant who billed by the hour to clean the bathrooms, since that would cost "real money".
They're surely not making savings. Your time doing your job is more valuable than cleaning things. They make a small (but easily defined saving) by not hiring a cleaner, and a much larger loss by having their staff stop doing their (presumably more expensive, skilled work) to clean things. What's your hourly rate? More than a cleaner?
It's not an unreasonable request to you, in that the company buys your time and this is what they want you to do. It's a fantastically unreasonable request if they're actually in business to make money and you should take a good look around at the company; this could be an early warning to jump ship. Be assured that other people are already thinking this, and that in such situations the people leaving first are the smarter, better employees; as each one leaves, the company will struggle a little bit more.
Edit: As I read your post, I heard this low blaring horn kind of noise, getting louder and louder, much as during Heath Ledger's scenes in Dark Knight. :p
I reckon you could probably have a go at estimating the new cost of cleaning by estimating how much time everyone spends cleaning and what their hourly rate is - this might give you a better idea of how badly things are really going. It might be really scary :)
> It's not an unreasonable request to you, in that the company buys your time and this is what they want you to do.
I disagree here. His company almost certainly hired him for a stated purpose, and that stated purpose almost certainly didn't mention a part-time stint as a janitor. The company doesn't (IMO) get to change the bounds of the employment agreement on a whim.
Wait a minute, I think I see what they're doing here. If they make these "requests" and you say no, then you're somehow a bad person for it. You don't want to come off as "dirty" or "snooty" or whatever, so you give in willingly. How evil!
Personally, as for having to clean a bathroom shared with 30 people at work? No way. Not unless I own the place, and can fire the bad ones who mess it up.
Also, it's up to you how you get your home cleaning done. You can hire a once-a-week maid service (it's not that expensive). You get to decide how clean you want your toilet bowl to be. It's your choice, though, and the only people you have to answer to (if applicable) are your family.
Having someone who can turn off your income and damage your professional reputation tell you that you have to drop everything at 4:00 and clean a toilet is a different thing altogether. That's ridiculous.
Again, if you're a real partner/owner (0.05% equity does not count) you do a bunch of undesirable work (including cleaning toilets, if it makes sense) because the buck stops with you. If you're an employee, you simply should not stand for this.
I once worked at a startup where the company gave an "across the board" 10% raise to the engineering team in a way that caused 3 key people to leave.
Essentially in a company meeting that reviews were being delayed for 3 months because of how crazy things were but there was an across the board raise of 10% to make us competitive. The catch, the raises took effect immediately but would not be paid until reviews were done, then everybody would get a lump sum catch up payment along with any increases from the raise.
The meeting dissolved into a huge mess where engineers kept asking "Why not give us the 10% raise now" and the VP Engineering got increasingly irate at the ingratitude without ever adequately explaining the delay.
I went after the meeting and asked the CFO what the hell was going on. Basically, changing all of payroll was a pain in the ass, had a fee of $25 per headcount, and it was going to take a week for our overworked accounting department to accomplish. So they didn't want to take the hit in accounting twice in such a short period of time. I went back and explained it to my team and things were all better.
Reasonable, and if the VP had just said that, all the engineers would have nodded and said "Good thinking!" but the damage had been done. 2 key developers resigned that same day and one two days later.
There are people in this industry who can send emails to their network and get a new, good job in the space of an afternoon. Don't do stupid crap to them.
Benefits should be added slowly and if they must be taken away it should not be piecemeal. Few things offend people as a continuous loss of status.
Machevelli,the Prince (From obtaining a state by Wickedness!)..
Hence it is to be remarked that, in seizing a state, the usurper ought to examine closely into all those injuries which it is necessary for him to inflict, and to do them all at one stroke so as not to have to repeat them daily; and thus by not unsettling men he will be able to reassure them, and win them to himself by benefits. He who does otherwise, either from timidity or evil advice, is always compelled to keep the knife in his hand; neither can he rely on his subjects, nor can they attach themselves to him, owing to their continued and repeated wrongs. For injuries ought to be done all at one time, so that, being tasted less, they offend less; benefits ought to be given little by little, so that the flavour of them may last longer.
Its really weird. I feel like the business school experience for most people was like "look at a balance sheet, find costs to cut". The program I did, at a not very prestigious school (my employer paid) the focus was much more on the long term impact and trade offs of the decisions you make. So you think "Ok, we will save 10k, but what will we lose?" When the answer is "we will lose the happiness of our team" this becomes an obvious bad idea. As an employer this is such an easy way to make your employees happy and reward them for working super hard for you. Once you lose sight of that and look at it as a cost to cut you might as well just not run a business because you're missing the bigger picture.
Trick is, much of the business world is measured by (and thus optimized for) quantifiable short-term impact.
The short term positive impact of cutting out snacks is immediate and obvious. The costs are less obvious and longer term. Do enough long-term planning in a place like that and people start getting tired of long-term answers to short-term numbers not moving.
Further complicating this stuff: say a 'good' CFO saw the value in a snack budget and implemented one where it didn't exist before. How do you even measure the impact of the improved work that goes along with improved morale? How do you credit a manager for nixing a 'cut the snack budget' suggestion? How do you measure the negatives that were never incurred?
It's very easy to see 'cut snacks, saved 10k; 3 engineers got the wake-up call, grumbled about 'stuff like this' and left, 4 projects now behind".
It's pretty tricky to ever say "this project is now on track because we added a food budget and put in a foosball table". [1]
[1] Which is why those items tend to be focused on as recruitment expenses. It's simply easier to measure/justify in that context.
Which is also why they tend to go away when the company reaches that size where further staffing is composed primarily of employees coming from jobs that also do not have snacks and games, so their necessity for recruitment is basically gone.
Agree. Unless you're the only tech shop in town, I think the complimentary sodas in the kitchen going away is primarily a sign of a decision to not be competitive in the recruitment process.
I don't think this is the b-school experience, more likely it's a result of management consulting experience.
Consultants often get into this mindset that they need to find a way to show their value in the most immediate way to their clients, in order to justify their high fees. Basically showing how quickly they "pay for themselves".
Coming in as a brand new CFO, you have to prove yourself quickly and justify the high salary you just took. The easiest way is to do that, is to find cost savings within the company and implement them expediently.
>> Coming in as a brand new CFO, you have to prove yourself quickly and justify the high salary you just took. The easiest way is to do that, is to find cost savings within the company and implement them expediently.
Right. I bet the CFO in the story had a two- to five-year time horizon for this job before he/she was planning to move out and up. As such, the CFO needed to make an impact in the first year or two in order to get noticed by bigger players in years two through five.
There are various aspects to that. For example, I recently took over a project, where the hardware part needs to be cost optimised. Basically, when the product was put together, two elements pushed the cost higher than I'd like:
1) Both software and hardware teams like using the best components possible, without necessarily putting enough thought into the target market, which the product is serving. I'm not saying that the product should be as cheap as possible, compromising on quality, but there needs to be a ceiling, depending on the market requirements.
2) Not enough thought was put into the most efficient structuring of the supply chain, resulting in unnecessarily high shipment and tax expenses.
So, the first exercise was very much similar to what you're describing - go through the bill of materials and one by one try to identify any cost savings. This is causing some loss of happiness (treading on people's toes, having to push for different solutions, in their eyes compromising on quality) but is necessary in making a better product.
I think that a lot of times these sorts of things come down to peoples inability to rationalize large numbers.
It reminds me of a story posted a while ago about the City of Boston moving from Microsoft products to Google Cloud products. One of the prime motivators of this move was claimed to be cost. Boston would save $280,000 in the move. $280,000 seems like a lot of money, a quarter million dollars. However, the story also quoted that there were 20,000 employees using the software. This means that the city would actually be saving $14 per year per employee, or a little more than a dollar per month.
If the employee spent more than a minute or two of paid time learning to use the new system, a year's worth of savings would be eliminated. Now, it's possible that the city would see efficiency improvements by using google apps, but that wasn't the reason claimed for the move. The reason claimed was that the switch would cost only $800,000 but save $280,000 per year. Within 3 years they would recover those costs and realize some savings.
When a new CFO comes in and sees that your 100 employees consume $50,000 worth of soda in a year, it looks like an easy place to recover a nice chunk of change. However, in reality the difference is a couple of dollars a day per employee. If those employees now end up going across the street to the coffee shop instead of getting free soda in the office you've just wiped out any gains.
The larger the organization gets, the bigger this feels. 1 employee spending $500/year on soda is not worth considering. 10 employees spending $5,000 per year on soda isn't really a big deal. 100 employees spending $50,000 on soda raises some eyebrows. 2,000 employees spending $1,000,000 on soda means it's going to get cut and someone's going to get a sweet bonus for cutting it.
Every one of these Windows/Office -> Linux/Cloud/Google analysis I've looked at included staff retraining and retrofitting costs. Not saying they aren't rosy estimates, but CIO's tend not to be complete idiots.
The costs of retraining and retrofitting was mentioned and bundled in at $800,000.
My point wasn't that they didn't do their calculations, nor do I mean to show bias towards MS or Google. My point was that the amount of savings they would realize ($280,000 per year) was so marginal when the number of affected employees were taken into account.
If I came up to you and said "I can give you a piece of software that will save you $1.17 per month, but I will have to sell it to you for $40", would that be a good deal?
Why is it that when you multiply those numbers by 20,000 that it all of a sudden becomes a good deal? Especially when you can't be 100% certain that your cost projections are perfectly accurate, being a bit too optimistic can wipe out any hope of any savings.
My point was just that because the numbers are big they look really important. But when you look at them spread across the workforce it looks different. Saving $280,000/year after 3 years is just fine. Saving $14/year after 3 years is fine too. One looks far more important than the other.
If the news story said that it would save them $1.17 per user per month after 34 months, would it have the same impact?
If a company says they spend 2 million dollars a year on free soda for staff, that sounds excessive. If they spend 2 million dollars per year on soda but they say that they spend 45 cents per day on average on soda per employee, does that have the same impact?
In the former, you don't have any point of reference 2 million dollars is a lot of money. In the latter you immediately consider things like how much the employee's wage is, how much electricity they use, how much water they use washing their hands after using the toilet. If you have someone using a Xerox copier that charges a few cents per copied page, now their copier usage is majorly competing with the cost of soda.
In the grand scheme of things though, a couple of dollars per day per employee, for professionals, can be pretty much ignored. But if you think of it instead of $1,000,000 per year, it's harder to ignore, even though it's the same thing.
The original article was about taking some thing away from employees and saving a small amount of money and doing that having negative impacts morale way beyond the savings.
In this case the city is GIVING the employees something and saving a small amount of money.
Oates said: "This decision represents an important step forward for the City. We want to equip all city employees with easy-to-use tools that allow them be more productive and innovative in their jobs, as well as a system that can scale to keep up with the city's demands."[1]
Not even rationalize large numbers, but when concentrating on details the vision of the greater whole can be lost. One of the reason startups are so efficient is that ideally the founders wake up every day with a definite goal in mind to work toward the larger objective. When people only understand a portion of the whole concept, they can make decisions that work in their sphere, but don't contribute to the whole.
In the story you cite, for example, the city didn't come in and say, "How can we be most effective," they were saying, "what costs can we cut" or perhaps "Oh goodness we sure spend a lot on that."
This brings to mind the classic "the airline that cut one olive on every Martini and save millions". Yes, it sorts of justifies the salary of an executive, but it's peanuts when you take a look at the whole company...
There's an understated point in this article- that once they get beyond a certain point, startups rely on the obliviousness of early employees to blind them from negative changes that surround them.
I mean, sure, the sodas were the wake up call that made engineers realise they wanted to leave. But the article seems to suggest that leaving the sodas free would solve the problem. Surely the core problem is that the company has changed, not that the engineers noticed it?
To me the point was more that the higher-ups had no idea how precarious their hold on their engineers was, nor how important certain everyday things (like free drinks) become to their idea of the company they work for. Had they realized any of this, they likely would have kept the free drinks (or at least been less cavalier about discontinuing them).
That struck me also. The mistake wasn't removing a perk per se, it was signaling that things had changed. But surely the employees would have noticed that sooner or later? So it seems there is a deeper problem, with no advice about how to address it.
The deeper problem is companies change. You can't have the same organization, culture, environment at 10, 100, 1000. You really can't. Laws change. The CEO no longer has time to talk to everyone. Structure must be applied or company becomes unmanageable mess.
The lesson is you will loose waves of talent at certain transition points. This can't be helped (other than by not growing). Leaders need to be aware and plan for this.
Might be a far out idea, but I wonder if around this stage, bringing in an anthropologist to study the culture of the company and suggest ways how to preserve some of the characteristics that originally attracted the first engineers would help address this problem.
I worked for a company that brought in an organizational psychologist who tried to get a handle on what ways the company worked well and didn't work well. It seemed like an interesting exercise.
And then we were purchased by a company run by insecure petty tyrants who alternated between neglect and micro-management, so none of it mattered. Sigh.
When I hear "free soda" I hear "free diabetes and heart disease". Free soda is the worst kind of encouragement to have your employees living a healthy lifestyle. I'd love to hear about a company who seeks to provide fresh local fruits and vegetables at its snack table.
I really don't mean to come off as a Debbie Downer, but soda is such a terrible scourge on society as a whole.
Free... soda, selzer water, coffee, Naked juice, fruit baskets daily...
The point is that these stupid small things make (or not make) you feel appreciated.
Although I don't hardly drink soda, having free soda available would allow me to believe that the company is willing to spend a few K/yr to say "We appreciate your hard work, have something small as a token of our appreciation"
Ummm, I've never been at a (small) firm that didn't offer diet soda if anyone wanted it.
Heck, I got at least one place to get caffeine free with sugar Coke, since I don't like the effects of the former and (at least back then) didn't have to worry at all about calories at that level. I was probably the only one who drank it, but it was a really minor effort for them to include it along with everyone else's preferences, and obviously that sends a message as well.
Yahoo! Ireland used to have free fruits, at least around 2006/2007.
I'm with you about the sodas. They are free at my work (with a loose rule of one per employee per day) and I always say to my fellow colleagues that it's terrible, sugar sugar sugar.
I noticed this at my first Silicon Valley job. When I joined, about a year after its acquisition, the kitchen was fully stocked and they had to ask people to take pizza home with them.
First the soda orders went from a variety to a few brands and the pantry which was always open, started getting locked. Then it was cut to just cold cuts in the fridge and you had to run once the pizza guy got there or you were hungry.
Attrition started soon after. It was apparent to all that our European parent corporation didn't quite understand how Silicon Valley worked. After about a year of everyone who could leaving (CEO, Dir of Eng, most of pre-acqu and post-acqui employees who weren't H1-Bs), the office ceased to exist.
Like the OP, I saw the cutting sodas as a sign. If they are going to nickel and dime on something that keeps people from having to take a 20 min break to quench their thirst, where will they stop?
One of the key reasons why I decided to join my first employer was because they had amazing fruit baskets delivered every morning. It saved me from thinking about breakfast.
Top banks and law firms have everything either free or heavily subsidised under one roof, from multiple restaurants to gyms, so that you don't waste any time looking for those things and carry on working like a dog (but feel privileged doing so). Just don't calculate your hourly rate...
People are totally irrational about free soda/snacks. If you gave them a $50/month raise (to cover the cost of soda and snacks), they'd be offended. If you put out soda and snacks, well you're just the most awesome employer ever!
-I don't have to deal with a vending machine that will fail to give me what I want 2% of the time.
-If something that I want is not there, I can ask the boss to get it next time rather than hoping for a machine to be restocked (probably by a vendor that may or may not carry what I want).
-The price of soda/snacks never changes.
-If I ask my neighbor to grab a soda for me, there's no need for her or me to keep a mental account of gifts.
exactly. It's all about producing a frictionless environment for your workers so they can actually be massively productive. Especially when a machine break down, takes your dollar, and makes you go to your car to look for some change. Then when you get back with quarters instead of bills, and the machine STILL doesn't work, that is just more friction and a waste of your brain thinking about these issues. At home, you have to remind yourself to bring a drink in case the machine isn't working, and bring enough change to get as many drinks as you need.
The best coders, in my experience, are very sensitive. They understand what great quality is. One little thing is off, and it will bug them. That's what makes them great.
I've never worked somewhere with "free non-lunchtime calories" (i.e. not tea and coffee). Wouldn't this encourage unhealthy consumption?
Rather like the "fixed monthly cost eat as much as you want 24/7" cafeterias in many US universities. I know, it's your own responsibility etc etc, but surely an abundance of free stuff will encourage over-consumption. Especially if you factor the psychological "if I don't eat it I'm getting stiffed" factor.
"'We warn Nooglers, which are new employees, that they should expect to gain weight during their first six months,' Welle said today during the inaugural Wired.com Health Conference here."
Since starting at Google I've managed to lose a good amount of weight due to increased availability of healthy(ish) snacks (free bananas and mandarins in the MK!) and the buffet style lunches.
<rambling>
How do the buffet style lunches help? Glad you asked.
When I have a plate of food in front of me, I eat everything that's on the plate. I may set out to do otherwise, and I'll even manage to avoid it in my first pass, but in the ensuing conversation over lunch I'll gradually nibble at the remains until everything is gone. However, if I simply take less food, there's nothing to nibble.
Now, I was also making an active effort to lose weight before this, and it requires a conscious choice to eat the healthier options made available to us (as there are plenty of unhealthy options). Compared to my previous gig, though, I've found it much easier to make good choices, diet wise, at Google.
Probably, or at least it is an enabler of unhealthy consumption. But I think that's also somewhat beside the point, which is that free stuff has a positive psychological effect even on those who aren't making use of it.
People are totally irrational about sex and love, too, but you can still screw up royally and hurt relations that way. Rationality don't enter into it.
Really, I think part of the affront here is that the absence of such a minor thing--perhaps especially because it's so cheap--is a really bad sign about how much the company values its people.
~
An anecdote:
About the best thing that my previous employer did was offer free coffee, if you could be bothered to make a pot from the existing supplies.
So, a coworker and I took to taking coffee breaks to buy some from a local coffee shop. Usually done after lunch, but still, it got us out of the office for maybe a half-hour or so. We really enjoyed this, because it gave us a chance to talk about other things and get some fresh air.
Said coworker also took to making runs to a convenience store to buy sodas--offering, of course, to do the same for other folks.
All told, these little expeditions probably amounted to a few hours every week in not-working time. Had the business been particularly ruthless, they would've noted that perhaps $10-12 every week in drinks could have kept some of their $50K/yr engineers from being useless for a few hours in search of nourishment. I'm not claiming that this was right, and we're more experienced now, but the fact remains.
A similar story was us getting kicked out of a conference room during a major refactor--we needed to pair program and use a lot of whiteboard space, and after a day or two (this was a really, really hairy unfucking of some core code that had no test suite), and got thrown out mid-project.
That code and project went down in true viking fashion a week or two later, and I left shortly thereafter.
>All told, these little expeditions probably amounted to a few hours every week in not-working time. Had the business been particularly ruthless, they would've noted that perhaps $10-12 every week in drinks could have kept some of their $50K/yr engineers from being useless for a few hours in search of nourishment. I'm not claiming that this was right, and we're more experienced now, but the fact remains.
Are you sure you were less productive overall? When I'm stuck on a tricky problem getting out of the office can do wonders.
It has a lot more to do with how you are treated. I don't drink soda, so free soda does nothing for me. But the fact that company I work for has those things and asks the employees what they want in the fridge is a very different experience than at a company without that concern. It starts with the snacks, but it goes all the way up to sitting down and asking what I actually want to get out of the job.
It's the difference between a company acting like you should feel lucky to have a job there, and a company acting like they are trying to keep you in your job there.
Is your goal wealth maximization? If so, you might understand that you're now getting an extra $50/mo for food purposes, but now you feel like you should hold it and not spend it.
Is your goal to suck down some minor pleasure to keep your brain mollified as you ponder some unsolved task? Well maybe the distraction posed by thinking of soda; thinking of buying a soda; thinking of buying a soda and wondering if you have the right change for it; thinking of buying a soda and wondering if you should really save that money to spend on a larger purchase later; etc... Anyway, maybe that distraction is greater than the distraction posed by grabbing a free soda.
People's different reaction to free vs non-free things, especially in the context of engineering work, does not strike me as irrational in general—only if you think that people maximize for present dollars does it seem particularly irrational.
So why not give them soda and snacks? It's cheap and easy retention, if that's what they want. The author is right, getting rid of $10k in expenses isn't worth it if it costs your the core of your team.
There's more going on though. If soda/snacks are free (and always in stock), there is less mental effort involved for the employees. They feel reassured that the snacks are always there when they want them. They don't have to make decisions about whether or not to buy them... actually this is a whole 'nother discussion about micro-transactions, which haven't worked well for the Web.
If you give your employees a raise, that disappears into the general fund, and is no longer a separate benefit.
You're forgetting about transaction costs. The transaction cost of spending money (and therefore time) to buy a can of soda is much more than cost of that can.
Theres often a time at 6:15 - 6:30pm where if I can have a light snack I return to my desk to work peacefully in a half empty office. In the absence of any options to satiate my hunger I just leave for home. Wonder if there are more people out there who do something similar.
I'm the same. Hunger is often my limiting factor. I'll be in the middle of working on something in the late afternoon or early evening and want to finish it, but I get too hungry. Then I have to leave the office and decide where to get food. By the time I'm done I'm not focused on the problem anymore. I do keep my own food at the office, but it's hard to always be properly stocked (I eat a lot).
edit: soda wouldn't do anything for me, though. Substantial snacks or "real" food would be much better.
Yup. Me too. I recently changed jobs from one that didn't even provide tea and coffee, to one which provides meals all day, soda, snacks etc.
I find that I am far more inclined to actually stay a little later and get stuff done when I'm not ridiculously hungry. Additionally, I can stay later after dinner and still have the same amount of free time when I get back home, which is nice for me, and for the company.
Because it's an indication of intent, a change in the winds.
It's feels like your employer saying 'numbers are now more important than getting things done'. It's basically signalling the beginning of bureaucracy.
And that's exactly what happened in Derek's example. So they were not irrational at all, it's a very powerful social cue that the company didn't even know it was giving.
It's a little more nuanced - things like this change the focus of the relationship from a 'we're in this together' approach to a more transactional one.
It isn't really about the snacks as such. We don't have free snacks here but we never ave so I don't care but I can see why such a change is very noticeable.
If the company used to given free snack but is now so short on cash that they can't, then perhaps people's positions aren't as safe as they thought they were previously. Whether or not there is a real problem, that is likely to be the perception.
Also we have an informal arrangement here: if I'm working late and get hungry I'll have food delivered and expense it. If I couldn't do that I'd have to go home instead, so if people are using the free snacks to stave off hunger at busy times this could be a detriment to the company.
Yes they are, but that works in your favor as an employer or boss. A box of leftover marketing swag goes a long way when you're not allowed to offer raises or bonuses. When we briefly stopped free sodas in our office, I said I'd just pay for them myself our of my own pocket but my boss reamed me out. That's the same boss that invited our whole department and more out to lunch then asked for 20 separate checks. I still kick myself for not just picking up everyone's check that day, but I think she would have fired me on the spot. She was gone within a year.
I agree that there's a lot of irrationality about it. You point out an example of that.
However, you're talking about going from no free snacks to free snacks. The other direction--free snacks to non-free snacks--is a bizarre change that sends a negative message to employees. In fact, as you say, it's equivalent to a small loss in pay, as now you have to cover those snacks yourself. Not a big deal... but why is the company effectively docking the pay of every employee?
At work, I think decision overload is a factor. It's not irrationality; they don't want more stuff to think about, especially because food is a break. People like free food because it doesn't require thinking. You just walk over and get a soda and chips. You don't think about it. You don't have to make another damn decision (even though, with 200+ empty calories on the line, one probably should) in your workday.
Of course, then they gain 20 pounds over 3 years and resent their employers (and commutes) for all those extra hours and such... or, if the employer switches over to healthy food, they get angry about the paternalistic aspect... this is hard one to win.
"People should either be caressed or crushed. If you do them minor damage they will get their revenge."
There is something in "small details" that make us just to feel humiliated. The kind of thing that is not serious enough to understand is needed "well, I get the company is in bad shape", but it feels like a personal offense "What?? I just got a word from my manager because I left yesterday 10 minutes earlier, when we have 'flexible hours'? F*ck you!"
When I think about the times I've been most upset with my workplace, it's always for those stupid details. They fell like personal humiliations. And personal problems are way worse than profesional ones...
Interesting that this was written in 2009. In 2009, that's when I snapped a picture in Charlie's which said "Googlers: badging today will allocate funds for your meal tomorrow": http://rachelbythebay.com/w/2011/10/17/badging/ - they added ProxCard readers hooked to laptops in every cafe. "Badging in" would make it play the PING! noise from Gattaca (or a vuvuzela, but that's another story).
The food was still "free" [1] but things had definitely changed at high levels. This was just a small part of it. It's taken some time for the change to become evident on the outside world.
I wonder if this post is related to the things I was seeing at the time.
Very bizarre to read these kinds of business stories. I was a business major and recall all the case studies regarding the unmeasurable, but vast, benefits to the company of providing ancillary benefits such as free gym membership, free child care and free drinks/snacks. Sure these things are measurable monetarily, but the increase in employee moral, employee retention, productivity and general PR over company culture are immeasurable. (Admittedly they are measurable to a degree, but so many variables can allow business people to end up with numbers that support their decisions)
I guess that is where academia collides with corporate politicking, as an MBA hired in a tech start-up it is easy to justify a 6 figure salary and stock options when you can show you are directly responsible for cost cutting of $x, rather than an MBA explaining they are responsible for $x increase in cost, but that company moral is up.
As long as free fizzy drinks are considered sacred, engineers will never reach the income levels seen in the legal, medical and financial sectors. Employers will treat like adolescents those who behave like adolescents.
You really don't understand this. Wanting things like this is actually the exact opposite of being an adolescent. It shows that you are, consciously or not, evaluating decisions in terms of the opportunity cost of your time. If my employer provides you small conveniences like food and a gym, it saves the hassle of going out of your way to get them. I happen to work in finance and joined my current company because they had a fully stocked kitchen and were putting in a gym. I get more value out of an additional hour of working and honing the skills my job requires than I get from having to leave the building, think about where to get lunch, go there, order it, wait for it, and then finally go back to the building. Guess who else benefits from that increased productivity? My employer.
Well, that's a little more directly connected to their jobs.
It allows them to start a patient on a drug without friction, or to give a patient who's going through hard times a full course of treatment without him having to pay anything.
Then to validate the point, if company X stopped offering free samples, competitor Y would probably benefit by still offering free samples. Or, the medical professional could just buy the samples from company X with their own money because they are no longer free.
I can't upvote this one enough. There is an astounding insistence among engineers that they should be able to dress like bums, swear in presentations, consume endless junk food and soda on the company dime, not be required to complete professional degrees ("judge me on my Github"), etc. etc. while simultaneously bitching that they're not paid like real professionals. Hmmn.
It would indeed be irrational to care that much about the drinks per se. Certainly it wouldn't occur to me to think badly of a company that just never considered providing them in the first place.
But if a company had been providing them and stops for petty reasons, that's a red light, not because of the drinks, but because of the petty reasons. It can very well be an early warning of incompetent and irresponsible management.
At my previous firm, cuts in these sorts of things was a rounding error in their balance sheet--completely immaterial. BUT it was viewed as an indirect signal to everyone to think frugally in your projects, work harder, and temper feelings of entitlement during difficult economic times. So I've always viewed these sorts of actions as a management technique, not necessarily a financial cost cutting one.
One place I worked went in a few short years from having free fancy coffees, etc. (for developers in their skunkworks office) to departmental secretary sending out an email complaining about the rate of consumption of cheap ballpoint pens from the supply closet. (A quick check online confirmed that if the consumption was reduced to zero, it would save less than $20/yr -- hardly worth the alienation and bitterness it caused.)
At that company I coined a rule that once companies start to focus heavily on "branding", it's time to bail.
Naming servers something cute, witty or clever is a gold standard of freedom among engineers. When engineer perks (server naming, or free sodas/snacks/food, lax daily start-times, etc) are taken away, the good engineers will quit.
I know this used to be the case, and makes a certain amount of sense when each box is physically accessible, but it seems unsustainable in the Cloud Age. Perhaps each online service we provide can be whimsically named, but that seems impractical for the constellation of DB servers, caches, app servers, load balancers, etc. that support a typical service.
I'm not sure about that. If management won't let you name the servers after characters in your favorite sci-fi movie, then that is an indication that names matter (ns1 for DNS rather than gandolf or papa_smurf or whatever) and that management is playing the role of the adult while you are acting like a child.
If you want to name servers after fairy tale characters and you will have a tantrum if management won't let you, then you are not mature enough to work for a company. It's called growing-up and being responsible.
Engineers are the ones who will have to use the server names. When management starts insisting things be done a certain way that's called micromanagement and it's the biggest sign your company is about to fail.
And good engineers understand the value of memorable names, as well as the less tangible value of good corporate culture.
It's the difference between being a hacker shop or a corporate drone shop. Both are somewhat viable strategies, but don't expect people to stay around for the transition. (also, it tends to be irreversible)
As much as this story is meant to be about keeping staff happy and managing expectation. Actually what I think it really does a good job is illustrate that finance and hr teams are pretty bad at managing the complex cause and affect that balance sheet decisions make. How many times have you seen someone leave because they were turned down for a pay increase?. The company then has to pay 12%-18% of an increased annual salary in recruitment costs for a replacement - added to the costs spent for managers time during hiring.
This reminds of the scene at the biggest virtualization companies and their great debacle of 2008. A certain VP was hired from one of the old order companies and the first order of business was cutting free dinners. Never mind the dinners were for folks that stayed late working crazy hours to finish the release. Next to go was the stuff in the kitchens. All said done there was a huge revolt, the VP went back to the company he came from. But the damage was already done, months later the CEO gets fired and that was the end of one of the best work cultures in the Bay. The exodus had already started.
At the end of day these are tiny costs when compared to the overall productivity of engineers. Yes, there are folks who will misuse it but those are a tiny fraction and cannot outweigh the positive effects. It shows that a company cares for it employees and is willing to go the extra mile.
Well, at our place can sodas cost 85c, so they're making a cool profit from us instead of it being a perk!
But, I was wondering, how much soda did these guys drink? He says the cost was about $10k. Correcting for inflation (http://www.usinflationcalculator.com/) that's $10,838. Assuming 11.45 for a 24-pack (http://www2.costco.com/Browse/Product.aspx?ec=BD_563-EC27726...), gives us 22,704 cans of coke. Assuming this was an annual expense and all 50 people in the company drank about the same, that's 37 cans of coke per person per month! That's a lot of coke.
Eh, not really. Think about it, when the soda is free:
You drink a can in the morning, because if you're a soda drinker you're probably not a coffee drinker, so this is your morning caffeine hit. Then you'll have one at lunch, because you're eating. Sooner or later you'll get thirsty again, so you'll have one in the afternoon. Maybe two (since the afternoon is about twice as long as the morning). So, 3-4 cans of soda per day, multiplied by 20 working days in a month gives you 70 cans per month. Assume this is near the high end of a spectrum of soda-drinking behavior, and you'll get an average of around 37 per month.
That's also a dollar per day per employee, which is absolutely nothing. If the all-in cost of that employee is over $120,000/year, you are bickering over what you are paying them for 1 minute of their time per day. And I definitely known coders that put down a hell of a lot more than 2 cokes per day.
A lot of people thought that this wasn't really a large amount of soda, bit it's the average, many people in the 50-person company will not consume this amount, so there has to be people drinking 5-6 cans a day. I personally average about 1.5-2 cans a day and feel bad about (this, of course, is on top of the mugs of coffee and tea I drink).
According to this CDC study (http://www.cdc.gov/nchs/data/databriefs/db71.htm) done in 2011, the group that drinks the most soda is males between 12-19, with 273kCal from soda a day. Assuming they don't consume diet products, that's almost 2 cans a day, but many other groups drink much less. If you drink 4 cans of non-diet stuff, you (will) have a serious problem.
I don't know. That's less than two per day per person, assuming ~20 work days per month. Sure, it's not healthy to drink two cans of coke per day, but I can easily see it happening. One when you get in, one after lunch...
It isn't healthy, but a free soda with lunch, maybe one during afternoon doldrums or early evening depending on how late you're working, multiply by roughly 20 work days / month, looks like ~40 to me.
Tell the executives they're wasting money on free parking. From now on., all executives will be charged $20 a month (or $1 a day) for parking. The primo parking spaces will be $50 a month. Surely that is reasonable! And watch the executives go into an uproar. This might help them understand in a way they can relate to.
This is something I think about a lot. Right now, our startup is just the co-founders and one intern, and we don't even have office space yet. But assuming we are successful and start growing, at some point we will have employees, office space, offices, etc. And what I find myself pondering is "how do we make sure we create the kind of culture and environment that we want to work in, and that other people will want to work in... and how do we preserve it as we grow?"
Now, you might say "Mindcrime, you're in a 2 person startup with no revenue yet, if you spend 2 seconds a year thinking about this stuff you're wasting time". But I think it's important for the founders to think hard about culture and work to start embedding that culture into the very DNA of the company, from the early days, and actively look for ways to resist the "culture decay" that @sgblank talks about in this post.
Assuming you have a founding team who retain a substantial degree of control over the firm as it grows (ala, say, Sergey and Larry, or Zuck) you wonder "is it possible to preserve the best part of what makes the company great, even if grows in size 10x, 100x, or more"?
There's a saying that when a company starts cutting pens and station office availability, it's time to search for an exit. I'd say it's the same kind of mechanics here: It's not that soda is so valuable, it's that the company reached a level where every little thing starts to get scrutinize and needs justification, and there's no going back from then.
I'm always amused by how quickly drinks seem to go in order to save costs when the cost of drinks for an entire small department of developers is nothing compared to the salary of a single one of them, yearly.
Not to mention the whole "developers and loose change" not going together thing so we tend to value them as worth far more than we should.
I've seen free snacks go away at one company - but it was during the company's first downsizing. The company was losing money. We engineers grumbled a bit but no one really faulted them for it.
The Support department set up a cash shop with far more variety of snacks than we had before.
I worked at a large consulting firm that went public a while back. As part of that process, they took away the candy bowls from the front office. Fast forward a few years after going public, benefits are cut to the bone. Vacation has been slashed in half.
Cutting costs (especially silly ones) is often a sucker's way to profitability. When people cut costs, they like to think they're being analytical. They often end up ignoring some indirect costs. A better model would include the expected cost in efficiency and human resources via departures and low morale.
I work for a small company, not a startup (I've been here 9 years), about 20 people. Yesterday we launched a website, today we got Pizza. I was happy. It cost the company £100 but it made all of us feel appreciated.
A couple of weeks ago I ask an owner how much he wanted for an old TV we had in the office, hoping that he would say just take it (the tv was 8 years old and not been used for about 3), he didn't, he wanted its ebay value. We agreed £30. That made me feel sad, less appreciated.
tldr; Small things can affect people in a big way.
> wanted old equipment for free
> had to pay a nominal price for it instead
> felt sad and less appreciated
Gotta say, your disappointment really isn't resonating with me. Sounds like quite a reasonable response on their part. People in management perform a constant balancing act with things like morale and expectations. Perhaps it wouldn't have been prudent to have you be seen to be getting "special treatment". Unless there were 19 similar old TVs to give to the rest of the team, then you can guarantee several people would have felt resentful about you getting yours for free.
At my workplace it'd probably have been given for free, and I'm pretty sure none of my co-workers would resent the recipient. Come on, it's an 8 year-old TV. Everyone who wants a TV has a better one already. Are we really so petty?
A company can't just write off things that are in it's inventory. They can either be lost, destroyed, trashed or sold. If you sell them, it has to be at a reasonable market value or you're in trouble with the IRS. So it's not unreasonable to ask for the ebay value. Ask for a low ebay value if you're being nice.
I think part of the issue in a lot of these circumstances is irresponsible spending to start out with. If the people in charge are spending exorbitant amounts of money on snacks to begin with, that's partially a nice perk, but it's also short-sighted: Benefits are important, but setting expectations is, too.
I've worked in startups that made this mistake, and once you've been down that road a few times, you can tell when people didn't think enough before they started placing those early food and drink orders. There's a line to walk between nice perks unmaintainable/excessive spending.
Of course, if you do decide you've gone too far, the article's scenario can play out, whether it's coincidental or whether the cut actually is because of financial problems (in which case it's unlikely the snacks broke the company, but they certainly don't help in that regard, and they do make it that much harder to effectively manage budget cuts without incurring even more employee ire and attrition than absolutely necessary).
Adding my experience to the data points of anecdote -- from working outside the Valley and in larger, more "traditional" corporations (albeit ones where sodas and at times meals were made free as perks -- either an historical legacy or a management practice gleaned from magazines and consultants).
When the soda stops being free (or meals, if you're so lucky, etc.), it's time to go.
If don't simply want to take this external advice, listen for yourself to the explanations that are given when this is done. After absorbing a bit of that language and convolution and misdirection, if you don't want to go on your on accord and the basis of direct experience... well, some people do do all right. But, from my perspective, they don't tend to be people I enjoy.
Foreshadowing aside, I neither expect nor care if my employer provides me with beverages. Not even coffee. If it's there, I'll probably take advantage of it from time to time, but it wouldn't actually influence my decision on where to work.
As a senior engineer who recently left a company undergoing a very ugly transformation, this strikes remarkably close to home. As with this case, the major pressure to change came not through the executives but rather the board.
I have strong aspirations of starting a company, but have seen too many examples of a board's personality being at odds with [what feels like] common sense business interests.
Anyone have any advice on ways to a) properly vet your investors and b) curb these situations down the line?
I didn't know it was a normal thing for companies to just give out free food/soda to employees like this, moreso to complain about not having them. How common is this?
Are you asking how common the free food/soda is, or the feeling of entitlement to it? The former exists where there's competition for employees. The latter is a pre-existing but latent condition that comes out in proportion to the presence of the former.
Personally, I've never forgotten that I'm lucky to have "extra" benefits, and I've never started believing I'm owed them.
I guess I haven't thought about competition for employees - I've only tended to think of the situation as employees competing for jobs. Does competition for employees only tend to happen in places like SF?
It's also this way in Cambridge, MA. And probably other places where there's more demand for highly-skilled developers than there are candidates. Maybe in smaller cities that are trying to bootstrap a startup scene.
Steve Blank says its a sign of a company growing and you didn't notice. So that sounds natural and should be expected. So is he criticizing soda-jerking or not?
I would think if it were managed, with lots of communication about new benefits that reflect the changing company behavior (more execution-centric, less skunk works) and new work-hour expectations, then it can seem ok.
It's funny, to me, that the guy will sit in a meeting with a bunch of executives and VCs, all making significantly more money than he is from the software he's writing, and the major complaint he has is that they're cutting off free soda.
To put it another way, it's amusing that the software engineers make a big deal out of free food and drinks, when the people "above" them are getting massive pay checks from the software engineer's work.
It's no wonder we're getting another tech bubble when software engineers will sell themselves out for $5 worth of snacks.
I'll quite happily take the snacks if it means I can code in peace all day and not have to worry about finding funding, talking to investors, keeping the company running, etc. They're the ones with money on the line too, they probably deserve the "massive checks".
Free soda is a perk that costs the company say $10,000. It makes taxes a bit complex (because do people really declare the free soda?) but it's cheap and easy and people love free stuff.
The goodwill you get from that simple gesture is worth more than just giving people the cash as part of their salary.
You either have PHBs that get it, and leave it alone (while monitoring for abuse) or you get PHBs who don't get it, and who cut it, and who then have to spend a lot more money replacing all the staff who leave.
But why does anyone bother counting such small money?
Hell, we don't even use one or two cent coins in this country at all. The time and effort saved is much more than the nitpicking about a cent here or there.
We were a 6 person startup that hired a CFO and cut soda because our burn was too high and we hadn' t raised money in 3 years. We experienced that exact same meeting and resulting effect at our company. It probably seems strange that we would get a CFO this early, but our finances were a total mess and we had a co-founder who dipped so 4 years after the founding we were hamstrung when going out to raise money.
I once was scolded for taking too much of what did eventually become the "managements" coffee.I was offered the ability to purchase packs so I could drink from that particular coffee machine, price tag: $60. The "others" were directed to another coffee machine, slightly inferior.
The fact that I worked more than 14 hour days, weekends, had to pay for my own cab fares home (because trained stopped at 23:45) and occasionally had to spend nights working on features to hit marketing deadlines. At one time they hired a freelancer who wasn't up to par so I had to do all of his + my stuff, four nights in a row. At some point all nighters was more common than non all nighters.
This seems to indicate to the power of common knowledge (see: http://en.wikipedia.org/wiki/Common_knowledge_(logic) ) which is not the same thing as shared knowledge. Common knowledge means everyone knows that everyone knows (that everyone knows, to infinity) and that's far more powerful.
The real crimes have nothing to do with soda. Some manager is hired from outside and is mandating daily status reports. Complain about that and you get in trouble, or people think you're a slacker upset that he can no longer hide. Or, let's say that you find out that some newly-hired VP/NTWTFK (Non-Technical Who-The-Fuck-Knows) is outearning engineering old hands who took actual risk; it's unjust, but if you complain about it, you endanger not only your career but the careers of the people who gave you that information.
The thing about free soda is that you can complain about the loss of it without showing insecurity or political bias because the change is in the common knowledge.
Companies get away with much worse crimes than free-food reductions (which aren't even crimes at all if (a) they were never part of the promised employment deal and (b) times are legitimately tough) but because there's no way to hide that stuff, those end up being the touch-points for complaints.
You can't complain about the new stack-ranking system without seeming insecure-- so executives can divide-and-conquer along those lines (we're firing 5% each year in a "low performer" witch hunt, but the top 15% get bonuses!)-- but the loss of free food is a more socially acceptable and universal grudge.
I actually like the fact that when Douchetember 11th happens, these trivial perks get phased out as well. If the executive shitfucks knew how to rob a company, they'd keep the free soda while turning the crank slowly on the robberies that actually matter (meaner performance review systems, equity clawbacks and cliffing).
Imagine what would happen if a large company kept its trivial perks but still disempowered engineers, gradually, over time. It might manage to hold a "best company out there" reputation 10 years beyond actually deserving it. Not that I know of any companies like that, but just imagine how effective it might be and how much executive robbery (at the expense of clueless talent) could go on.
Old trick. This is taught as a way to get people to leave by themselves. Often followed by contracts not being renewed, and people moved into hours they don't like or into roles they don't like.
Those people leave by themselves, then the firings happen... and stock goes up, targets are met... BONUSES ALL ROUND! Woo! (Or merger/new investment/whatever needs a up+right graph).
You're left with people who are duffers, and possibly doing harm to the company. Or with people who have many years with the company and who will be expensive to layoff with redundancy payments.
Actually it's not true that it's a good sign for the company: once things start going downhill, the best people look for somewhere better to work. I recall at one company, they fired a bunch of people, many of whom really were not top performers. Immediately after, the best people started trickling out.
A few years later, the company was acquired and a few years after that, the whole thing fell apart.
Cynical, but true. Once the company reaches a certain stage, this is a valid (albeit evil) path to travel down. Upper management gets rich, everyone else gets the shaft.
More insane than cynical, I think. Cynicism is seeing things clearly without any romantic or emphatic filters. Insanity is making sure the most able part of the workforce finds other employment.
This is a horrific strategy. Not only is it dishonest attrition, but it's the wrong kind. You should cut complexity/failed projects and then cut people.
If you cut people but don't cut workload/complexity, then the survivors just have to work harder. That's not sustainable, and with the underlying problems of the company (complexity overload) unfixed, it only becomes a worse operation. Sure, complexity-reductions need to happen and often those involve cutting jobs-- either through a layoff or attrition dynamics-- but just cutting jobs is a short-term remedy and won't work if the company itself isn't truly streamlined.
Then one day a guy came in with a hand cart, loaded the coffee machine on it, and rolled it away. A week later the layoffs started.
The lesson here isn't that there's something intangible or magic about free sodas or coffee. It's that when you used to give out free sodas and coffee, and then you stop, you're telling everyone in the company that business isn't as good as it used to be. Beverages are an easy thing for the bean-counters to get approval to cut, so when times get tough, they get cut first. But they're also a small line item, so while they're the first thing to get cut, they're usually not the last.
In other words, the free sodas are the proverbial canary in the coal mine. When they die, it's time to get out if you don't want to die with them.
This is why, when I visit clients these days, I make a point of going with them to their break room to get some coffee before our meeting starts. If their beverage situation has been upgraded since my last visit, they're doing well. If it's been downgraded, I know to be on guard for bean-counters coming after my relationship with them.