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Comment by fnbr | Hacker News Reader

There's a great article on this topic from Steve Blank:

https://steveblank.com/2009/12/21/the-elves-leave-middle-ear...

He argues that a leading indicator is when free food/drinks are removed, as it's a sign that the company is moving from a growth, "we're all in it together" mentality to a cost-cutting one.

I, personally, focus on who's getting promoted and who's leaving. If a company is promoting internally and retaining people, then it's typically in a good place; if a lot of people are getting hired above others, and new employees aren't staying long, then it's in poor health.

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When I read things like this, I like to take a moment to realise how fortunate we are to work in a sector where something like freebies is almost considered to be a sacred right. Is there any other profession or sector where they get the same treatment?

I don't think removing or reducing these benefits is a sign of poor health. I think it's more a sign of turning into a proper business (which needs to answer to the people who put the money to buy all these drinks in the first place), which isn't for everyone, but it doesn't _have_ to be a bad sign.

I do agree with the second part. The attrition rate is definitely something to keep tabs on, but it's important to know why people are leaving.

> I like to take a moment to realise how fortunate we are to work in a sector where something like freebies is almost considered to be a sacred right.

Bear in mind that, most programmers do not get paid overtime, and are expected to work like horses. The reason freebies are sacred rights are because those are, in part, the unofficial payment for working in such conditions.

Yup. I would take getting paid overtime over freebies hands down. 1.5x for every hour worked over 40? Sign me up.

1.5 is a little low 1.75 after 8 Pm 2x at weekend and 2x plus a day TOIL for sunday

Yeah, but grandparent's claim is incorrect. Freebies aren't about compensating for overtime exemption.

For what is worth I'm in Japan so YMMV but I think this generally applies anywhere: if you switch from overtime-exempt to a hourly contract and keep working the same hours, your base monthly salary + overtime pay will be (in average) the same as your current salary.

The catch is "in average". Most corps will avoid having you do overtime if they have to pay extra for it, and conversely will try to switch off-hours support work to salaried employees. So you might end up working less hours and earning less as a contractor -- and sometimes that's what you want anyway. In other cases workers manage to game the system; in some orgs I know the contractors work longer hours than most non-manager salaried employees.

ye like fat food and high content sugar drinks.

Couldn't disagree more. With this mindset why not throw all your employees in a basement and stack them up on picnic tables? If you're not scrimping on every possible front, you're not a proper business?

There are plenty of sectors that have nice offices with snacks and drinks, by the way.

It's always better to invest in growth than to fake it by shaving the budget. When human niceties start getting pared away, it's a sign that growth opportunities aren't working out.

which part of open-floor plan do you not understand?

Cubicles getting ripped out to make way for open plan would also be a negative indicator.

> I don't think removing or reducing these benefits is a sign of poor health. I think it's more a sign of turning into a proper business (which needs to answer to the people who put the money to buy all these drinks in the first place), which isn't for everyone, but it doesn't _have_ to be a bad sign.

Free drinks are incredibly cheap compared to buying the same results through paying higher salaries. Losing them is a sign that the company cares more about fitting into the herd than being effective, which has to be a bad sign.

The math doesn't actually support that view. Over the past couple of decades a number of studies have been done on this and it is always less costly to the business to pay 'snacks' than it is 'overtime.'

When you step back and analyze the business mechanics, which is to say your cost to run the business versus the revenue that business generates, in terms of personnel cost from most to least expensive is 'salary + overtime', 'salary + snacks', 'salary'. In many ways snacks are the 'open plan' equivalent of cost management.

That said, I don't think there is ever 'one thing' that says "Hmm, we might be dying." often it is a combination of things. From a startup perspective founders leaving (especially if they are replaced by someone completely out of the blue), delays on new projects, failing to replace people who have left and were doing good work. All good signs.

My dad attested to this as well.

He said it is absurd how cheap you can buy employee loyalty with free snacks and soda.

Even at a 100 person company, they were spending ~$600 / week on snacks but when you factored in that developers cost $30+ / hr alone, you are buying time for such a low price.

You are literally giving a developer $2 for $15+ of their time. That is even discounting the price of keeping them in the same brain space and some possible cross-team germination.

Please be aware how many executives, lawyers, physicians, finance & trading experts expense meals in restaurants and hotels, go to "trainings" on cruise ships, fly in business class.

Giving engineers free peanuts (so they don't walk out of the building to by some) is hardly a perk.

And think of how many of those actually have administrative staff around them to take care of all of that too. The perks of being a programmer anywhere but google pale in comparison to the perks of the average high end professional.

I'm really surprised about the physician comment. My gf works in the largest medical system in the Bay Area and her "perks" (discounted cafeteria food) are drastically below what I've had at any company in the tech industry for the last decade. They don't even pay for flights for residency or fellowship interviews so doctors have to pay thousands during these times while they are huge debt. She actually has to rotate between hospitals and they don't even subsidize her parking. They don't even support pregnancy for fellows, you have to take state disability.

Which hospital / medical systems give great perks to doctors ?

Certainly none that I've worked at or had friends at. Best perk I've ever seen was free knock-off k-cup coffee, and that was a cut above the norm.

Once the doctor starts writing prescriptions.

Sure, just keep in mind what the people running these companies are helping themselves to.

> I don't think removing or reducing these benefits is a sign of poor health.

I think this is a very different statement than "it doesn't have to be a bad sign". Leaving aside the question other people addressed of whether freebies are good business, the fact of the matter is that they're currently commonplace. If a company gets rid of those benefits without a clear trigger (like an acquisition by someone more corporate, or C-level turnover), the question to ask is why?

Is it likely that the executives who previously offered freebies attended a leadership seminar and decided it would be more professional to take them away? Or is it more likely that the trajectory is bad, and snacks looked like a responsible first target for budget cuts?

The question here isn't "what's a responsible first cut for a struggling company?" On that point, I agree, cutting snacks before staff is probably a sensible business decision. The question is "what's a warning sign that the company is struggling and you don't know it?" I think empirically, cutting freebies without a clear cause is definitely a sign of poor health.

Don't consider it a freebie. Think of it as an untaxed benefit. When you look at it that way, how would you feel if your employer cut other benefits.

They are nice to have and welcome, but not mandatory. I'm actually the only one in my group of friends who has ever enjoyed these kind of things. That's why I say we are very lucky. Once you step out of the tech bubble you see that what you take for granted is only a dream for many. I can work part time and still make more money than they do.

Retail often has employee discounts, does that make it a great sector to work? Free drinks cost what, $100/employee/month? That's nothing.

So if you have 50 employees that's $5,000 per month, which could be used to pay another salary. Or you could pay your employees that extra $100 directly so they use it whichever way they want.

Employee discounts in retail are usually within company margins for sales and they are limited (e.g. $1,000 purchases per year or so). If the margin doesn't cover these discounts or the system is abused they will get reduced/removed. Likewise, if a startup thinks these $100 per month are better spent elsewhere perhaps they are just being financially responsible.

When a company starts to issue mugs instead of one time usable cups as a way of saving money. That's when you know the company is going through health issues instead of focusing resources on real issues. I've seen it happen first hand in two companies & it's a fast slippery slide for people as redundancies are just around the corner.

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