Hacker News Reader

Comment by tonmoy | Hacker News Reader

If that is true then it means they hired more people than they needed and then instead of admitting it they gave some nonsense about macro economics

View on HN

I am friends of a long time, Fortune 50 CFO. Well, he was about 16 years ago before one large company went public and he made about $40M in a single day and decided he wanted to do something new (can't blame him).

He told me repeatedly that companies that lay off the moment a bad quarter appears - or if they lay off employees if they even think the market will slow down - are always terribly run companies.

He said it was a clear indicator of poor internal planning and forecasting, that any company who suddenly needed to shed 5,000 or 10,000 employees on one bad quarter was was one to avoid.

This can be true and we can also recognize that the pandemic probably made everyone’s internal forecasts bad. These tech companies have some smart people working there, I would bet their projections are pretty world class.

I've worked there, it's not any different than the rest of the business world.

How so? The motivation and competency and ownership is the same as at say Comcast?

The comcast is bad meme is interesting but what specifics do you have that it is worse at business than Google?

I am no fan of comcast and pay a premium to avoid them since I disagree with bandwidth quotas. But both Google and Comcast have bad customer service and some terrible products yet both have respective and respectable monopolies. YouTube is terrible and amazing at the same time and more teens watch it than cable tv. Yet there is awful content and no good way to screen it from children besides denying access entirely.

Google also arguably missed ChatGPT and TikTok as macro product trends. Previously, Google failed to capitalize on social networking.

I am not sure how you forecast or predict those things in any way that guarantees success. And even when you see the future to pursue and build that core competency. I don't think large companies can move fast enough because by the time you notice the competition they've already established a network effect.

And network effects seem to be the main moat. It remains to be seen if Threads really kills Twitter. It's not even clear that Musk can kill it unintentionally, i.e. the business succeeds despite its management.

A company the size of Alphabet "shedding" 5-10K employees is a notable but still minor adjustment in the grand scheme of things.

No, it isn't. Details matter, and if they hiring even 1% too many people, then what else are they getting wrong by 1%? And how many of those things?

The key is that they wouldn't know either. It could be a slow 'death by a thousand cuts' and they wouldn't even know they were bleeding.

This is why companies, even massive companies, generally die eventually. There are very few that last even 50 years without eventually being acquired or bankrupt. And how does it start? Little mistakes, lack of focus, everywhere.

> then what else are they getting wrong by 1%?

They could get 1000 things wrong by 1% and they're still 1% wrong. You can't really add them up.

Maybe they hired more than they needed because of the shifting macro environment? The number of employees you need depends on what you want to accomplish which depends on interest rates, consumer spending, and tons of other macro factors.

They hired more really good people to leave fewer really good candidates to the competition. Maybe it made sense. They could not publicly declare this though.

They always hired more than needed, even now. I think it's a common knowledge. Most of the time it worked out because google's stock always grew, but yeah if conditions become bad they wouldn't need to think a lot before laying of 20-30% of the workforce.

Reply on news.ycombinator.com