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How do short-term thinking business types infiltrate technology companies? (pawb.social)

submitted 6 months ago by [email protected] to c/[email protected]

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I feel like it’s a common script that most good companies eventually fall to short term focused management types who are happy to shred the company as long as they get their golden parachute.

Why does this seem to be the case? If you wanted to build a company that was more immune to this sort of thing how would you go about it? Examples and counter examples of these sorts of companies would be awesome to hear about.

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[–] [email protected] 4 points 6 months ago

Incentive structure. Let's take a simple real world example I have dealt with.

Me: look I like your software but you got to work with me on this price

Sales: well I can't really bring it down that much

Me: hmm how about the support contract part? Looks like we get three years. If you could make it ten I could spread the cost over ten years which will make it hit my budget less hard.

Now the sales guy has a choice. Make money today and get his commission hurting the company down the line or maybe not getting the sale. Keep in mind it isn't like the company is losing money, they are just not getting as much as they want, or at least that is what he will argue to himself.

This is a small example but I think it illustrates the point. The incentive of the individual in a company do not have to align with the company and even if they did the company today takes priority over the company a decade from now.