Ask HN: Why do corporate failures always seem to punish the wrong people?
She was let go not because of her own incompetence, failure or not fitting in, but purely out of rushed budget cuts (budgets were finalized, finalized again, and then they realized it's still not good enough).
The reason for those cuts, in this particular instance, was not the overwhelming rise of AI and/or getting more firing power for data centers, it was very clearly a long-visible path of failure two levels above, where one particular person continued to wreak havoc up over the past few years, and, ultimately, caused this cul-de-sac disaster.
The person at the center of this all is an older dude who consistenty has been on the wrong side of any decision he's made. I've only heard of a few things as it is (literally) none of my business, but it's been nothing but chaotic and ill-advised choices. He moved into this role from failing elsewhere, leaving the chaos there behind him, and over the past two years, now has caused yet another disaster in this new role.
My question is, and sort of the point of this post (which I understand is entirely philosophical): how do these people consistently survive their self-inflicted disasters? While her entire team (30+) has been let go now as a result of it all, the person who ran this into the ground continues onwards in the business?
They even made her fire and break the news to most of her team in weekly chunks recently, before telling her she's of course, also done.
I used to work for a big five too, but have been self-employed for over a decade now, so I may be too far out to understand, but it just puzzles me how certain people always manage to stay untainted admist the chaos they've caused, at the cost of everyone else. This used to be a thing I've heard over and over again from friends at Google, but it really seems to be very consistent thing elsewhere, too.
They're clearly not smart people, is it ruthlessness? Are they aware of the disaster they're navigating into and plan well ahead? It's a mystery to me, and it just can't be healthy for these companies to allow such folks to continue onwards.
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[ 111 ms ] story [ 342 ms ] threadBecause it's hard work and it's easier to let someone else bear the costs.
Maybe it is the nature of how failure is expressed at that level, to know a team of 30 has been let go and is not available as your extended arm to execute anymore. So, where it manifests as a job loss at a level lower, it is merely a limitation of power for them.
This is not my experience. People who are in positions of power, e.g. managers, are the kind of people who are incapable of admitting fault. They can't lose face so the shit is rolled downhill. It's narcissism.
=> https://ribbonfarm.com/2009/10/07/the-gervais-principle-or-t...
She and/or you have a false conception of what a big five corporation is, or how it works. Yous probably also have a false conception of how relations of production under capitalism work as well. The man higher up the hierarchy at the FAANG has a better grasp of how these things work. Often, people don't realize their conceptions were wrong until they get let go.
That she worked tirelessly, was well liked does not matter. That in this short life we have, that she skipped vacations to devote more time to the company does not matter.
You said the person above her is not smart but he clearly is - he is higher up and survived and she is lower down and was cut.
Insofar as it being healthy for these companies for him to be there - him being there is in the nature of the corporation and perhaps its intrinsic infirmities, just as it is intrinsic to relations of production under capitalism.
One would hope that something as dramatic as not only him being over her, but him staying and her going would disabuse you of these notions. Especially the idea that she had sone kind of relationship within the corporation where working tirelessly and skipping vacations would engender any loyalty on the part of the corporation's higher managers and owners.
Very often people say they aren't happy with a system, but secretly profit off of it, so they try to keep the system from changing. Maybe you have examples that don't follow this schema, but I've maybe seen a handful of such cases, whereas I've seen dozens where people were simply hiding their active support.
Better reply: https://www.astralcodexten.com/p/come-on-obviously-the-purpo...
Delegating authority is a velocity/democracy tradeoff. Polling 100k people about where to get lunch doesn't work.
So over time, any time someone does something that might be seen as unjust, if it's within the error bars for "unusual but not a hard line", shifts the line more and more, especially if the people in question are good at controlling what the people above them hear, or calling in favors to shield themselves, until you wind up with sentences like "well of course they got fired, they were working on $THAT_PROJECT, and everyone knows $MANAGER hates $THAT_PROJECT".
To be less reductive, companies are owned by capitalists and they prefer autocracy for obvious reasons.
2) Cooperatives are what you are looking for. Why aren't there more of them? No founder ever wants to share the initial investment. Is it a universal human weakness? I don't know. Why aren't the very few that exist growing to be more successful than a small local niche thing? Probably because democracies work best for small groups and progresively degrade as the number of people increase.
3) It works as indended. The people that are (temporarily) interested in the success of the organization, and with the power to change it if it looks like it's failing, are not interested in long-term success. As long as company's stock can be sold, only short term profits matter.
Owners of family businesses are more likely to listen to low level employees, but they're still autoritarian.
Corporations are made of people and the structures can be very dysfunctional. I’ve seen it and I’m sure it’s common elsewhere, many decisions are made with no actual rational understanding of “economic sense”. An example is firing someone to save costs but needing to then hire 2 new people to replace them, increasing communication costs and having to pay a training cost.
I recognize myself a long time ago in your partner, so much mental energy wasted to the game where I could instead just clock in, do some stuff, clock out and spend the rest of my energy where it matters: at home, with friends, cooking, working on personal projects. Let the insane corporate climbers light themselves on fire to keep management warm, I'll derive my worth elsewhere.
I don't think it matters what industry it is, you get an organization large enough and some humans start exhibiting these behaviors, they often rise up in leadership ranks.
Have you ever read the Ribbonfarm series about organizational/management theory tied to The Office?[0] Its worth a read or a refresh. It might even be cathartic reading for your partner after an event like this.
[0] https://ribbonfarm.com/series/the-gervais-principle/
The reason this is so important, both in government and in private business, is that these people decide nothing, until you get to the very top. And the ones at the very top are terrified of actually making any decision. They're at the top and what they're currently doing obviously brought them there. A change? Seriously? They carry out decisions from above them. The reason they want people who deflect blame from the decisions is, yes, to protect themselves, but also to make sure the person they work for can protect themselves, after forcing the wrong decisions downwards.
Companies, and governments, hold on to ideas decades (and governments: centuries) after they've lost their usefulness. You want to get far in education? You find a way to explain why knowledge of Latin determines success in life in 2026, and you learn to make this argument without giving the slightest hint it's not your actual opinion, without insulting Latin teachers, and without insulting administrators.
The problem is, of course, that if you chose the sane option, that Latin is about as important in 2026 as the remaining 2 years in the career of the long-since-senile senior education minister are likely to be ... you will not have any further need to worry about managing up.
Which is why they also seem to focus so much on protecting their position.
It explains a lot, frankly.
People gamble with small companies and upstart political parties. Large companies and big parties don't gamble. Would you?
Although those slippery people will just begin to perform for the AI as well.
We are onboarding resources We are cutting resources We are shifting resources
I’m not sure it’s true that being a bad middle manager makes you a bad director or exec.
I definitely agree that the most effective upper management (directors and execs) would mostly make terrible middle managers.
Idk how you “prove” you’re anything beyond middle management anyway as an external hire outside of network tbh which is maybe why some of those positions go for over $1M/year which equally boggles the mind - to cite an example, why is an HR director at Netflix making $1.2M/year
I see upper mgmt the same as middle mgmt. What is your distinction between the two? Budget control? They are both in the middle of the organization and are sort of generic jobs in a way.
There's a lot of good answers here. One supplement I would make to a few of them is it is harder to fire or punish someone the more they resemble you. A lot easier to see the fault in a woman a couple of rungs down than a guy your age who looks a lot like you and you've had beers with for a decade. The (truly) wealthy aren't like me and you. And in a crisis you'll find out how they're different real quick.
It’s definitely a set of skills.
Suppose some top executive has a choice - do something right for long term success of a company vs something sketchy and detrimental but get huge yearly bonus in the pocket.
Are you rock solid you yourself would always go with the right thing?
But yes you're right it really depends on power dynamics.
Us folks who work for a living aren't charging any machine guns, thankfully - but if my boss's boss's boss can't get our division to make a profit the entire division is at risk, no matter how good my area of the division may be.
break everything up, "official" lines of comunication, phone, email, that are essentialy black holes, then a maze of second, third,fourth level worklings who always refer you to someone else, who may respond with company and title in a voice call from a private number, reluctantly giving a first name. In person meetings with the brass that are glad handing and zero information, second level meetings where YOU sign contracts giving them vague authority and power. Further in person meeting with underlings who are very agressive and commit to nothing. Fucking shark tanks, right, and you are everybodys, chum. But if need be they will quickly turn on there own and put someone on the hook. There is more, a whole lot more, but non of this is new, or any particular mystery, just exceptionaly out of controll right now.
2. When an organization must downsize, you want to make sure once the dust settles that no one under you is able to take your job.
3. These decisions are political, so you need political power to defend against them.
The overall problem can be summarised as we don't live in a meritocracy.
So to answer your question "Why do corporate failures always seem to punish the wrong people?" They don't. People just don't post about it when a bad boss gets pushed out or some incompetent on their team gets offed in a round of layoffs that they survive.
It is the oldest story in any kind of human community, from tribes to empires, from marriages to enterprises: they're ruled through is politics not justice.
Meritocracy and justice is just the order that we want the world to be, the ideal state. Its entropy and normal state is politics and this as nothing to do with justice.
When people try to get to meritocracy it can also impose serious costs on society, both social and monetary cost. The imperial examination in China (which some would argue was the closest to a meritocracy) brought little advancement to China despite the fact that China was probably the wealthiest region until the 12-13th century. It did make the brightest/richest people study for years, sometimes decades of their life to produce little value after succeeding (except for themselves). You might argue that this isn't a meritocracy but I think we'll get similar behaviour no matter how you define 'merit'.
Goal displacement -> Goal displacement occurs when an organization or individual shifts focus from original objectives to secondary goals, often prioritizing procedures, metrics, or internal processes over intended outcomes.
In large corps, people who are good at staying in a company, and people who are good at serving the company's objectives are typically two different skillsets. And one of those skillset helps you stay inside the company more than the other.
>> They're clearly not smart people
Nope, they're cunning and if it offers you any solace they usually lead miserable lives which is also a natural outcome.
To your general question, I feel it's a variation of the "why do bad things happen to good people", and philosophically we (humans) do not have a satisfying answer that I've ever arrived at, especially if you're not religious :(
To your more specific question, it seems that like myself and probably many of us here on HN, you approach large corporations as a meritocracy and you assume that key skills / merits are the ones that produce, create, support, deliver to customers, etc. It is my observation that these are loosely correlated with corporate success. There is a specific set of skills that are more associated with corporate success, including crafting your perception/eminence/image with key people, networking, being aware or appearing to be aware of the big picture, strategy, finances, and true goals/product of your company, as well as clever career management. I find I personally am intelligent enough but not smart enough / "something enough" (perhaps ruthlesness, to your point; I'm literally having conversations with my therapist on how to be more Machiavelian - I know and can see actions that would benefit my career and therefore my family who I love, but struggle to actually implement them because they do not align with my internal goals/values/approach) to aggressively pursue that skillset and corporate success.
Note: I would NOT fall into the easy trap of saying "These are not smart people"; that leads to underestimation / expecting results from them which differ from reality. They may or may not score highly on a standardized IQ test, they may or may not have the same kind of intelligence and knowledge as you value, but clearly they are "smart" in some specific ways, and clearly very practical/useful ones.
All the best to you and your partner!
It's not: I've been involved in quite a few projects that get abandoned, (or otherwise miss their target) for one reason or another. There's a few things that you (or your partner) can do to protect yourself.
Most important: Make sure that your role (as an engineer) in your company is in the most critical part of the company as you can handle. When budgets get cut, it's not the best "crank turner" who keeps their job; its the people in the most critical roles for products (and projects and processes) that the company no longer can fund. (Note that this isn't foolproof, because foolish management can still goof and let you go.) (Note that in large companies, this is much harder because you can become critical in a niche that the company decides to divest from. To handle this, move into a subsidiary that would be sold as a unit.)
Secondly: Understand the business cycle. All products (and projects and processes) have a lifetime, and at a certain point they are "done." (As in, not worth investing in paying the best crank turner or the most critical person to keep working on it.) When you smell this happening, let it be known that you're open to severance when the budget gets cut. It's always easiest to let go of the person who's willing to take severance because they're ready for a change in scenery.
Next: Make sure you can get a feel for how the product (project, process, ect,) is actually used. You might have turned the crank really well, but if no one is using the result, it's time to be proactive and move on.
Finally: Learn to judge your management, and build relationships with your boss's boss. This will give you a lot more insight into the company so you can learn when to move on or how to position yourself in the most critical part of the company.
> "Make sure that your role (as an engineer) in your company is in the most critical part of the company as you can handle."
The main problem here is how much the organization wants to think it can continue without those crucial parts, I've seen wild things go down in this regard, and I think we'll see a lot more in the near future with people hoping that AI will take care of it. And, on the flipside, and much to my surprise, how often the org can actually survive through such disaster cuts regardless, even though they'll end up at a worse place than they were at before, but the simple act of surviving it -- at that point -- is enough of a success to continue onwards.
A crank turner thinks having a solid platform to stand on, a long crank arm and good lubrication is crucial. Because those things ARE crucial to crank turning.
Corporate management is looking at the machine the crank is attached to and thinking if that machine is going to produce the company's next quarter of growth.
The machine you crank could even be very profitable right now, but it's not where the company is going. Here's an easy to follow example from a smallish business:
https://youtu.be/9EMR2BVbG8Q
mittermayr: My other points explain why just being in the most critical role isn't a guarantee. I also pointed out that "foolish management can still goof and let you go."
That being said:
> and much to my surprise, how often the org can actually survive through such disaster cuts regardless, even though they'll end up at a worse place than they were at before, but the simple act of surviving it -- at that point -- is enough of a success to continue onwards.
mittermayr: Either this is foolish management, or you're misinterpreting the situation. If the company believes that, in the end, it's successful, then how can you argue that the company isn't? Can you provide an example? Otherwise, you might be misinterpreting the situation, and it's what pbronez says is "The machine you crank could even be very profitable right now, but it's not where the company is going."
One thing I don't understand is why he didn't sell the Etsy part of his business.
Selling the Etsy side of things is an interesting idea. I wonder how you could do that without also selling off the tools and things you need for the SKUs you want to keep. I don't think they had distinct brands, for example.
A trillion dollar company can lose 99% of its value and still end up a multi billion dollar business. And I don't think many cuts come close to that kind of bloodbath.
They can survive the cuts because leadership isn't fundamentally affected by 99.99% of day to day operations. And their compensation at that level isn't on simply "make good product and accrue revenue". That's a big part why we've been in this irrational market for quite a few years now.