Seattle CEO who pays workers at least $70K US says it's paying off
cbc.ca
cbc.ca
I think when people insist this "wouldn't work" in many cases they are missing the point. This is obviously not a move you make without fundamentally changing how you manage the company, but I think all service delivery companies could make this change.
From the article:
> Now, many are starting families and buying homes. He estimates one-third of Gravity workers have become debt-free, and two-thirds have significantly cut back on their debt.
> Her junior colleagues work harder than ever, she said, easing everyone else's workload in the process.
This suggests structural transformation in how the company distributes work and also deep investments in the people at the company. These can be successful strategies! They limit your agility when it comes to staffing changes, but not every problem or opportunity requires staffing agility.
I suspect at high levels this kind of thing might also look like Netflix's approach to pay and jobs (high pay, low security)[1].
https://www.npr.org/2015/09/03/437291792/how-the-architect-o...
The payments industry is relatively low-turnover (compared to other "tech" companies at least) and doesn't require as much innovation once a vendor has a foothold in their market. Could this policy have been successful before they were profitable with recurring customers?
I.e. I imagine some startups have attempted a policy like this -- is there any data on the success rate for "flat compensation" companies versus more common meritocratic and seniority-based compensation structures?
And how would the numbers look if full and part-time contractors were included?
i did pcb design work at google at a very junior level as a temp, made $15/hr
number of employees = 798k
yearly pretax GAAP earnings = $13,976,000k
yearly pretax GAAP earnings per employee = $17,514.
[1] Form 10-K, for FY ended December 31, 2019: https://www.sec.gov/ix?doc=/Archives/edgar/data/1018724/0001...
But even if it's 1 permanent to 1 temp, or 1 permanent to 2 temps, it's still a little far from the $70k. I'm assuming the temps would also get some pro-rated bonus, for example 50% if worked 50% of the time.
Also - remember that this is in a good economy (not "the greatest ever" like the president likes to say, but still an expansion, so good). Companies are supposed to make profits now, to have a cushion for the bad times, so they don't have to contract business immediately on the first sight of trouble.
IOW, Amazon is not a very good example.
Pretax earnings: $11,460,000k
Employees: 2,200k (yes, 2.2 million people, worldwide)
Pretax earnings / employee: $5,209
[1] https://www.sec.gov/Archives/edgar/data/104169/0000104169190...
Boeing? 10% margin (before the MAX - not in 2019, so not a Google or Facebook but still quite good). 12 months ending December 31, 2019:
Number of employees: 161k
Pretax earnings: $-2,259,000k (loss; that's the MAX fiasco)
Let's take pretax earnings for 2018 instead: $11,604,000k
Earnings per employee: $72,074
In a good year, not in 2019 with the MAX troubles. Assuming shareholders are somehow OK with this. And assuming you need $0 for growing your business (like new factories, machines, acquisitions, hiring more people). And assuming you're leaving yourself with zero room for error (no cash cushion for a bad year), because sure as hell Wall Street will not give you investment-grade credit once you need it so that your bonds can go into old people's retirement accounts and slowly blow up there.
>But Rosita Barlow, director of sales at Gravity, told BBC News the opposite has been true. Her junior colleagues work harder than ever, she said, easing everyone else's workload in the process.
What a wonderful way to make toxic management get rid of itself.
I walked away with a couple of different lessons, including on why this keeps showing up in places :)
Price: 'we've been relying on billionaire philanthropists for so long, and I don't really think that's working out very well for us...'
I didn't know Rush Limbaugh could be that hilarious
Some state passes legislation the party in power doesn't like, they use the Fed govt to clamp down on issues. A few years later when the party in power loses majority, they pass legislation on the state level, and complain about their rights being infringed on when the same behavior happens.
Rules for thee, not for me.
Looks like now it's the minimum. They had to bump the skilled positions to market rates.
The credit will dry up pretty quickly with stunts like this, and the fact that he doesn't call it a success is VERY telling.
No business fails because it does not generate revenue; they only fail when they do not generate CREDIT. This is a "dit.com" era scam. EVERY job at that company can be automated, and you only get credit when you are reducing costs and expanding. This guy is jerking off in public, nothing more.
This article will not age well
I've seen from up close how salary declined for about 1000 people in an unskilled physical job (that didn't change for 100 years). They were initially paid handsomely. Today 700 people do the same work for 1/5 of the money.
When paid handsomely the workers went out of their way to get the job done in time.
When pay sufficiently declined they stopped doing that. To get rid of the uncertainty they contracted another company to manage it. (along with a bunch of other work)
When pay declined further that company hired another company specialized in the task.
When pay declined further that company hired a job agency to fill the holes in the schedule and another company to monitor materials and supply them.
Its funny in a way, people on the work floor use to make their own schedule. If they needed extra employees they would call their wife, their kids, their friends, their neighbors - you have to come help right now!
If tools and materials were lacking they would jump in their car and go get it. They often paid it out of pocket and didn't bother asking it back.
All of the money and then some went towards an army of office folk who have been unable to organize a large list of things for longer than 6 months.
The quality of work is inferior in countless ways but with all these managers and administrators they did manage to increase cost. I estimate it is something around 2-3 fold.
What use to be a beautiful paper administration is now a series of crufty apps made by people who don't understand the work. When the apps fail the old employees are happy to do it on paper again. When the work schedule is delivered the employees start rearranging it.
The only long term employees who stuck around are the ones who don't give a flying fuck if the work is done properly if at all. It use to be that people worked double shifts just to get things done.
The solution, management thinks, is to hire better more expensive managers and more of them.
You get remarkably little credit if it isn't secured either by assets or a proven revenue stream. (Or you pay enormous interests rates to offset the risk)