Comment by tptacek | Hacker News Reader

Comment by tptacek | Hacker News Reader

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Answer: "Because we don't call it 'negotiating a raise', we call it 'applying this formula'."

Two immediate problems with the formula and one problem with the concept.

First, "scope", factor 2 in the formula, can be external to the employee. It's in Spolsky's interests to hire people who "could" manage multiple projects if given that responsibility, but the demand for those people inside Fog Creek will tend to be lower than the demand for lower-scoped responsibilities. His formula thus does one of two things: it incentivizes him to hire less talented people --- even when he may want a buffer of talent inside the company --- or it creates a totally subjective ranking system where 10 people are qualified to lead a project, but only the "favorite" does.

Second, "skills", factor 3 in the formula, is also subjective. That he's coded it in a chart doesn't change the fact that the "skills" spectrum is basically the line over which every salary negotiation is fought anyways.

Which leads to the general critique of this, that coding and regimenting salary negotiation does nothing except code and regiment salary negotiation. OK, so Fog Creek is transparent about the behavior they want to incentivize. But so what? The real world still creeps in and subverts this system:

* "I'm capable of leading this project, but I'm never getting a lead role because 5 people with seniority are always going to take the next available slots."

* "I was given this task to complete, but it was poorly specified, and so my output didn't contribute to company success."

* "You'd be ranking me at a higher skills level if you put me on a project that would give me exposure to new technology."

* "You'd be ranking me at a higher scope of responsibility if you'd just recognize that my team lead is a moron."

All the same pathologies seem to remain intact in this system.

Curious as to what I'm missing.

it incentivizes him to hire less talented people

This seems spectacularly unlikely given Joel's other writing and the fact that he's running a profitable company, the profits of which substantially depend on the quality of staff he hires. Saving 1% of payroll and giving up any substantial "edge" in development is a bad trade, and regardless of your opinion of Joel, I suspect he's smart enough to know that.

All the same pathologies seem to remain intact in this system.

All of those same pathologies sound to me like pathologies with the people not the system, and the solution is to just recognize that people who can navigate themselves around small obstacles are actually more valuable. People who complain at year-end about why they couldn't acheive their maximum potential need to be steered into a mindset where next time they find a speedbump to drive over or around it, not to stop and complain about the uneven pavement.

Two responses:

(1) I agree that it's unlikely that these problems affect Fog Creek in practice --- although how would we know? But the point is, Spolsky wrote this to advocate for a practice in your company, where this formula probably won't help you.

(2) If "people" didn't have irrational issues with salary negotiation, it wouldn't matter how you handled salary negotiation. The purpose of a system like Spolsky's is to neutralize those problems, and it succeeds or fails based on how well it accomplishes that.

if it is a "bad trade" then the salary levels are wrong by definition

It's in Spolsky's interests to hire people who "could" manage multiple projects if given that responsibility

I'm not sure that's true.

I've never been a project manager, but I have had a job where I would sit idle for weeks at a time because nobody had anything for me to work on. I eventually quit.

So I would expect that someone who could manage multiple projects at Fog Creek, but is only managing one, would not be happy there, either, even if he/she were paid as much as the people who actually were managing multiple projects.

And, yes it's good for there to be a buffer of talent, but that buffer would ideally be spread across the whole company--every person who is managing one project should be able to manage one project and contribute to another--not concentrated in a few stars.

If every person in the company can manage a project, then Spolsky's formula is artificially restraining compensation for the majority of his employees, and the selection of who gets to lead FogBugz and Copilot and Project Antelope or whatever is simply a proxy for the same subjective political BS that happens in every salary negotiation. Which is kind of my point.

Again: no doubt at all this system works for Fog Creek. But it was written up in Inc. because someone believes it could work elsewhere. Not so sure about that.

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