Here is my best story about business consultants...
I was contracting at a big three automaker and they had retained just such a firm, possibly even BCG, to "restructure" the IT department.
So they had a team of overpaid consultants come and perform an analysis. I won't even get into the pointlessness of all that. However, the leader of the pack, the alpha male of the consulting team, would physically walk his laptop over to a printer near the admin's desk to print because the information was too sensitive to print over the network.
In true hacker fashion a buddy and I had recently discovered that you could telnet into the printers and with a carefully crafted command actually set the text on the LCD readout on the printer itself. (The spot where is usually says "Load Paper") So we actually wrote a program that would allow us to send any text we wanted to any LCD of a printer.
So of course, this self important consultant became our first victim of the prank. He hooked up his laptop and we starting sending text like "Loading Virus" to the LCD. It actually became a little frustrating because he wasn't noticing the LCD.
Finally, he looked at the LCD and we starting sending text like "Downloading files from computer". This guy just went into an absolute panic and after the first few seconds of frantic inactivity he got his act together and closed the laptop. Of course, that didn't stop the printer from "Downloading files", so he finally ripped the cable from his laptop to sever the connection.
He was in a panic for what I'm sure were some of the longest seconds of his life, but by then we were doubled over laughing just a couple of desks away and he caught on.
I will give him credit for taking the joke well and he never tried to push it up the food chain or anything to involve any management.
Well, if you're looking for fodder for future fun and games, remind your mark that all sorts of interesting stuff can be recovered from the disks that are often resident inside mid- and upper-end printers. And remind your mark that printers actually can be infested with stuff; it's a good spot for malware to operate on a LAN, too.
Great description of burnout: "What I learned is that burning out isn’t just about work load, it’s about work load being greater than the motivation to do work."
This is so true. My father took on a nightclub all by himself. It was a stupid move, he lost a lot of money doing that. What he was missing was a partner. Not only to lessen his work load, but also to keep him motivated.
This is the reason you see musicians take 5 year breaks, or even quitting music. They are lacking in motivation. Look at the band Queen, They are still making music and touring, but half the band has quit. Freddie Mercury died and John Deacon quit music altogether. What did John Deacon lose? His motivation. Brian May and Roger Taylor both had a lot of say in the bands creative process, and that process motivated them to continue, even after Freddie had passed away. Now, Deacon, he wasn't as involved in that process, and he was the one who quit.
John Deacon had a very small part in their total creative output, and so, his contributions to their creative development wasn't comparable to that of the other members.
It doesn't contridict that Deacon didn't have a say in the creative direction: having written one song that was popular is not the same as having influence on much of the band's output. I don't know enough about Queen's history to say that Deacon did or did not have creative influence, but citing one song isn't support.
That sentence really stood out for me too, especially since I've been going through something close to that.
I always wondered what caused people to 'burn out' on jobs that you couldn't possibly call taxing by any stretch of the imagination, I think this is the key to the answer.
"At my salary level, and with my expected advancement path, I could comfortably retire in my thirties."
I've heard this or statements like it in quite a few articles over the years, but I've never actually met a retired thirties business consultant. Do they exist and am I just missing them? The only ones I know are well into their thirties, working 70+ hours a week, and looking forward to making even larger boatloads in their forties.
They think they will retire in their thirties, but they never have enough.
"At a party given by a billionaire on Shelter Island, Kurt Vonnegut informs his pal, Joseph Heller, that their host, a hedge fund manager, had made more money in a single day than Heller had earned from his wildly popular novel Catch 22 over its whole history. Heller responds, "Yes, but I have something he will never have...
Their fixed costs keep rising. When you are 22, you think that $100,000 a year (rising with inflation) is heaps. But by 30, you buy your first yacht, and it takes $50,000 a year just to keep it in the dock.
While that's true, the cause of this is a salary that compounds faster than inflation. If you make 10% more each year it's almost impossible to retire anywhere near the salary you had 5 years ago without saving a huge percentage of your income.
EX: Ignoring inflation, if you get a 10% rase a year and get a 10%ROI on your investments every year then you need to save 40% of your income to for 35 years to retire on what you made 5 years before you retired. (Assuming you can live safely on 4.5% of your capital / year)
LOL. There's a huge difference between a hedge fund manager and a management consultant. Perhaps the billionaire will never think he has enough, but the consultant will actually, in legitimate and reasonable terms, not have enough. They really don't make much money for the hours they put in. Factoring travel, they work as much as an investment banker and essentially earn what a banker would earn without his bonus.
Hedge fund managers are to management consultants what wolves are to sheep. Please don't compare the two. One is a master, the other nothing but a slave.
That actually undermines his main point -- that he stuck to his "morals" and forgone the "large" hush money check at the end. If he was making enough to retire by his 30s then $16k wasn't that significant of an amount. That means the didn't really lose a lot so his "moral" stance is more symbolic, and not the tough financial decision that article might imply.
I don't think that was his main point. He had, after all, just said that he was willing to compromise his morals to the extent of continuing to work with BCG despite the dishonesty it involved -- because the amount of money potentially involved was so large. "I think I’ve come to the conclusion that having a father who can pay for a top-notch education outweighs the disadvantage of being raised by a hypocrite. Sticking with the job for the sake of a paycheck passes the children test."
So I'd say his main point wasn't "look at me, I stuck to my morals" but "I'm corruptible but not infinitely corruptible". (The reason for mentioning the $16k in the title isn't to say "look how much money I turned down" but to say "look how much money they offered me for this".)
> The reason for mentioning the $16k in the title isn't to say "look how much money I turned down" but to say "look how much money they offered me for this".
Right. It's to emphasize the fact that not only were they morally corrupt and doing horrible things, they were incompetent to the extent they though they could shut him up with a measly 16 grand.
If he gets a book deal out of this he'll be laughing pretty damn hard at a bribe attempt that, really, isn't even a house payment.
Eh, maybe. Numerologically, I think you're right, but you do have to keep in mind that a $16,000 lump sum has a lot more subjective value going out the door to an uncertain future and a zero income - at least, temporarily - than it does in the course of making six figures at a stable job.
I'm not saying he had any reason to suspect he wouldn't be able to find another job, and even quickly, but it probably wouldn't pay nearly as much and there was no guarantee of that. It's just the depressive state accompanying the sensation of having been fired, even if it's from something you hate in concrete terms.
The whole moral thing is questionable, if he would have taken his leave that would be one thing but the company initiated the termination, not the author.
Depends. If you are making $300,000 a year and live like you are making $15,000 a year (and save the rest), then you can retire at 30.
Most people aren't willing to be this frugal, however. It seems some people making this much even have trouble "making ends meet", because they buy so much crap that they can't afford. Ah, consumerism.
(In the interest of fairness, I am almost as bad -- I love buying stuff. I just stop when I don't have any more money... and I might even be able to retire before I'm 90 :)
The problem here is in the matter of status symbols. A quick tale for you: A consultant who gave me my start in the industry once had his car break down before an initial meeting with a client(Mercedes). He had to borrow his son's tricked-out VW boy-racer to get to the meeting on time. As he pulled into the meeting the clients were exiting their cars and saw him parking. He said the meeting never even really got started, as they had already pre-judged him.
There are lots of little cues like this. The car you drive, the cut of your suit, the watch you wear. It's funny because this is an industry that everyone is aware is awash with charlatans, so everyone is looking for clues that the person they're speaking to is credible. Which is something that can obviously be hacked. Having said that, it does basically work. A guy wearing a huge Rolex is probably faking it, for example, it's just too obvious.
On the other hand - if you've got the Armani suit, the Tag Heuer or Rolex, and drive the Porsche, you can only be 'faking' so much; obviously you've had some financial success.
Not really - the suit and the watch would fit onto a fairly normal credit card, for example. You'd be a fool to go into debt for them, of course, but people do, status symbols, even misguided ones, can be powerful lures. Rolex and TAG in particular are now almost anti-brands for that reason (same with Louis Vuitton luggage, Porsche, Burberry, etc).
The guys who signal to each other with these accessories are subtle and understated - their messages are intended only for others of their type. Anything a rapper would wear is out! Think Pierce Brosnan in Thomas Crowne or James Bond. He's a actor who is "faking it", playing the role, and doing that on screen takes a wardrobe professional who studies this full-time and the budget to spend not $2000 but $20,000 on a suit (really, that's what Brioni costs, and what the production spent) and I'm sure there are real "upper class" people who glance at Bond and spot all the little mistakes straight away.
> If you are making $300,000 a year and live like you are making $15,000 a year
It's possible if your employer is paying for your relocation. In 2004 (IIRC) I went on training teams for clients of ours continuously for about two months (with a brief stop at home in the middle). Not only I accumulated a respectable mileage, I spent about a third of what I usually spend in my home town (São Paulo, Brazil).
I'm 40, married for the second time, with a 14 year-old boy from the first marriage and would not be able to reduce my expenditures to that level, but it's quite doable if you are in your 20's.
To summarize in English: Stewart started an unnamed firm, and tried to exit mid-bubble four years later; his partners didn't want to buy his equity, so he sued them. By the time he got his shares bought three years later the firm had imploded.
After 10-15 years at one of the top consultancies you could have completed outright the major capital purchases of your life (e.g. a house or two, maybe a boat) and could downshift to something much less stressful but you certainly couldn't stop working altogether. And these houses would be nice, sure, but we're not talking mansions with helicopter pads and servants here. Basically you would be established in a solid upper-middle-class lifestyle, but you would still need to work to maintain it.
The consulting business pays very good wages, but you don't get to build any significant equity - what you need to retire on - until and unless you make partner.
A good consultant could probably retire at 55 having set up his family well, private education for the kids, a bit of a trust fund, a comfortable retirement and bit of an interitance and so on. But as I say, this is not what most people would consider "rich". There's a good bit in Wall Street where Gordon Gekko is trying to explain this to Bud Fox. $100k salary and flying business class everywhere is not the same as $50M in the bank and a private jet.
"I got the feeling that our clients were simply trying to mimic successful businesses, and that as consultants, our earnings came from having the luck of being included in an elaborate cargo-cult ritual."
WOW that is dead on. I get the feeling half the world is like that.
The problem is that it is not that simple, because just doing what others do works very well in most cases and you don't have the time to start questioning _everything_ - why do you shower in the morning? Why eat three times a day?
I don't want to defend cargo-cults, but people copy because it works.
No, it's worse than that. I have seen this before. There is an entire portion of the business world that merely goes through the motions of being successful businesses rather than actually being businesses at all. It's really weird.
You could look at it as investment fraud with plausible deniability. Take money, hire consultants, look busy. The only thing is, I don't think it's that explicit or intentional. I think there's a breed of person out there in the business world who does not grasp the distinction between actually doing something and imitating the appearance of doing it.
There's always been something wrong, and I couldn't quite put my finger on it, with the idea of getting a degree solely in "business"... I think I get it now.
Reminds me of a shirt I saw somewhere from a cartoon I've never seen: "What's this? I'm going to go do some Science on it!" Seems very similar to: "I'm a business man"
I could not agree more. Business is something you do with stuff, but you have to have stuff to do business about. Business is not something that can be done in a void.
A lot of the fakers and cargo cultists are trying to do business about business to do business... they're not delivering any value because they don't know how.
I think these comparisons are a little off base. If i am not hungry at night, I normally skip the dinner. If I am on a lazy mood on a weekend, I skip my shower/shower in the evening. You don't have to question everything, but you shouldn't do anything that doesn't make sense to you. and that's barely the case in big business environment.
Interestingly, a google search for "This is the first in a four-part series on the author’s experiences as a consultant in Dubai." and "This is the second in a four-part series on the author’s experiences as a consultant in Dubai." (with or without the quotes) turns up the other two articles well enough.
This story is written with a wonderful naivete. Consultants like BCG exist only to lend credentials and competent temporary labor. The companies who hire these consultants are looking for affirmation and peace of mind -- most of them too mired in bureaucracy or incompetence to draw even the most basic conclusions by themselves.
Still, it's hard to believe that peace of mind is worth paying 5 kids graduated 6 weeks ago in Political Science from Stanford to come give Powerpoints on meaningless, vapid crapola billed to you each at $300/hr, even where such figures don't make much of a blip on the bottom line.
It does seem strange, but here are some reasons why this happens:
- When you hire BCG or McKenzie to (for example) value a business segment or recommend an acquisition, their feedback can be touted as expert and unbiased.
- BCG will do whatever it takes to deliver what's asked, even if it's a banal Power Point. So the person who decided to hire them is taking a minimal risk by doing so.
- In many cases it's a chance for the client company to get insights on how competitors have solved similar problems. Albeit in the story everyone's right out of school, I've seen cases where a pharma company will hire a group from a place like BCG because they've also worked for a competitor.
- Lastly, it's a chance to work with some talented folks who might make good permanent hires at the client company.
Bottom line, is that this type of consulting is usually a huge waste of money. But it's also one of the only ways huge companies can get a group of talented degree-toting individuals to work on important temporary projects with the assurance that company will get exactly what it wants.
In companies there are people who are paid to decide things. They also have budgets. Often they are called managers. There are consequences with decisions.
Managers learned a trick: Give the money of your budgets to consultants to make the decision your company pays you for.
If the decision was a good one: The manager was the one who hired the consultants!
If the decision was a bad one: Who could blame the manager, even the top consultants of BCG/Berger/McKinsey couldn't make the right decision, he hired the best!
Either way: The manager outsourced the work he was supposed to do but still gets paid and freed himself from the consequences. Heaven!
I've worked at so many of the largest companies as an employee, contractor and even overpaid consultant and this is completely true. These companies are completely mired in their own structure that there is nothing they can do to get out.
Everyone is protecting their turf and their headcount that you almost have to have "Bob and Bob" come into, even though they don't know anything themselves.
When I was working for a professional organization as a consultant, sometimes I would go into gigs where I literally knew nothing about the product that I was supposedly an expert on. I remember specifically one case where I spent a frantic weekend learning about a tech that I was supposed to help this company plan a rollout for because I was the expert. The worst part was these employees had been preparing for this rollout for weeks, so they already had a good grasp of the core and I was still trying to learn all of the acronyms.
Human group social behavior is a liability in our modern society. It works pretty well when you're a tribe of 20 people hunting and gathering, but it doesn't scale.
That's just how the managing partner described it when BCG came to do a recruiting talk. He called theirs one of the most improbable businesses in the world- companies pay a lot of money to have just-graduated kids work on their problems.
The thing is, on an individual level, consultants really do work like sled dogs. If you have something in mind that needs a dozen fairly smart people to go to North Dakota and work 90 hrs a week for 3 months, consultants can do that and your regular employees probably can't (or won't).
However it's up to you to actually have something like that in mind in the first place... I can't think of anything offhand myself!
"I wasn’t sure at the time, but having had enough free time of late to ponder such questions, I think I’ve come to the conclusion that having a father who can pay for a top-notch education outweighs the disadvantage of being raised by a hypocrite. Sticking with the job for the sake of a paycheck passes the children test."
I wonder how many children get sent to college by dads like that.
I was sitting next to Reg Braithwaite at the first startup school when one speaker (pg?) said something about startups being for young people so they can focus 100% on the company without worrying about kids. Reg stood up and said, paraphrased, "I'm starting a company _because_ of my kids, so they can say that their dad showed them how to follow their dreams instead of doing the safe thing like everyone else."
Respect.
My oldest is 7 now, and I hope he'll be able to say that his father showed him that living with a clear conscience is worth even more than a top-notch education.
I think it shows closed-mindedness on his part. They taught him analysis at MIT, but they didn't teach him to think properly.
You're a guy with a degree from the top technical school in the world and you've got one of the world's most prestigious consultancies on your resume: you don't think you could go on to find a job in which you could afford your kids' education AND not be a hypocrite?
I respect him for standing up after the fact and saying "I'm a wealthy hypocrite." But I don't respect him for going to work there in the first place. You'd have to have spent junior year of college buried in sand not to know it's a game, mostly dirty.
Well he was taking a double course-load and working, so that may count as being buried in sand.
But still, even if he didn't know beforehand, he figured it out very quickly upon arrival and then stayed for a long time for the money, so I agree with most of your point.
However long he worked there, he didn't bite the hand that was feeding him, but when the party was over he did turn around to bite the hand that fed him.
Being moral about the NDA does not weigh up against working there in the first place, and I don't know what $16 K means to a high profile Dubai consultant, it may have been substantially less than the severance pay he was entitled to anyway.
I don't think anyone was claiming that being moral about the NDA does "weigh up" against working there in the first place. If he were trying to paint a glowing picture of his own morals, he wouldn't have written the article in the first place.
(Since he appears to have been there for something like 6 months before getting fired, I'll hazard a guess that his severance pay wasn't all that spectacular.)
10 K+ per month is not unusual, and depending on his contract they may have to 'buy you out' (for instance, after three months they might have signed a years contract with you including the first three months).
So the severance could be anywhere from $5K up to a very substantial amount of money. The fact that they're willing to pay another $16K just for signing an NDA suggests it was a pretty high salary.
He already said, kinda, what the salary was: with bonuses and whatnot, he expected to be getting $200k per year.
Given what he's possibly done to their reputation (I don't know; perhaps everyone already thought they were corrupt and dishonest anyway) that he wouldn't have been able to do if he'd signed the NDA, I don't see that an explanation in terms of salary is required: getting everyone to sign the NDA greatly reduces their exposure to this kind of bad publicity.
The Assumption here seems to be that these kind of decisions are 'one second' ones. sadly, they are not. Most people in most situation take time in deciding one way or other. Mostly until they find a strong push in either direction. In this case it seems to be the confidentiality agreement.
I don't know, but I think it's a horrible conclusion. He hated his job and felt he was making the world a worse place. If that's what his top-notch education got him, why did he want the same for his children?
Large consulting companies often tell their clients what they want to hear, which more or less negates the point of consultants but can often pay better. There are ethical concerns here.
I like the story, but the article itself has way too many metaphors that cloud the point.
Or maybe I'm just too used to having all my stories condensed into 140 characters...
There was another important point: a guy new to the consulting business and with no significant amount of relevant training or support wound up being marketed as an expert and became the senior person on each project he joined.
I've seen this in action, both from the client side (management brought in absurdly highly paid consultants to back up what they wanted when their own people wouldn't support it) and the other side (friends and friends of friends who went into consultancy firms; few of them have stayed there much longer than this guy).
What I don't get is why shareholders (for big companies) or government auditors (for government organisations) don't openly criticise the policy of wasting money hiring these completely unqualified people who either offer no real benefit or actively cause harm to the projects they join. Obviously a genuine expert could offer useful consultancy in their field of expertise, but that doesn't seem to be the MO of these big multinational consultancy shops.
Shareholder activists will usually argue how companies stupidly waste money on consultants. It's just that there aren't a lot of them.
In the past, Buffett has criticized consultants.
1995 Letter:
Concluding this little dissertation on acquisitions, I can't
resist repeating a tale told me last year by a corporate
executive. The business he grew up in was a fine one, with a
long-time record of leadership in its industry. Its main
product, however, was distressingly glamorless. So several
decades ago, the company hired a management consultant who -
naturally - advised diversification, the then-current fad.
("Focus" was not yet in style.) Before long, the company
acquired a number of businesses, each after the consulting firm
had gone through a long - and expensive - acquisition study. And
the outcome? Said the executive sadly, "When we started, we were
getting 100% of our earnings from the original business. After
ten years, we were getting 150%."
“I would rather throw a viper down my shirtfront than hire a compensation consultant.” -Charles Munger
I think shareholders might not widely realize how it works. Often, shareholders are actually the ones who demand bringing in outside consultants, because it's seen as getting an independent third opinion. It looks more self-interested for the company's executives to set their own pay, than it does for an executive-recruitment consulting firm to recommend what the going rate is. Of course, executives have gotten good at getting the right consulting firms to answer those questions, and consulting firms know that if they don't answer appropriately, they aren't going to be asked back.
Shareholders care only about relative performance. Absolute performance is irrelevant. So as long as all big companies in a particular sector waste X on consultants, that's fine for the shareholder. It doesn't even affect the dividend as you might think, because if everyone does it the cost can be passed on to clients.
Shareholders start to care once a lean competitor enters the scene. Someone who does away with all the fluff and is more profitable. These things happen. But my reaction as a shareholder is to become a shareholder of the better company and dump the stock of the inefficient one. I'm not trying to make the inefficient company more efficient. Some activist shareholders do that, but most don't.
There is one very important truth that too few people are considering: Shareholders are not entrepreneurs. Most shareholders have no interest in improving a particular company. Their interest is in choosing undervalued companies and selling them when they are not undervalued any longer, preferably at a higher price.
The distinction between investors and speculators is a lie. There is no difference between the two. The important difference is the one between owners and entrepreneurs.
Shareholders used to try to improve a company - it was quite popular in the 70's and 80's. Ever watch the movie "Wall Street?
What happened since then is that legislators and courts have become hostile to corporate raids, and have mostly made it toothless. We would have plenty of shareholder activism if it wasn't for that.
Yes. I also never understand the reason behind poison pills (part from shielding management). Why should shareholders limit their own rights to sell the company to somebody who wants to run it?
`Corporate raid' is a term as backwards as `piracy' for copyright infringement. Those `raiders' buy a company with their own money (or money they borrowed) from shareholders willing to accept their price. They should be allowed to do whatever they want with their newly acquired company.
The only problem is they rarely buy the whole company, often they just get a controlling share. At which point they can do a pump and dump which is great if you sell at the right time but it tends to hurt long term investors.
How do you pump and dump a large company that you just purchased at a premium?
Incidentally, if such a pump and dump scheme was performed, the guilty party is completely obvious. A minority shareholder lawsuit would be readily forthcoming.
There are several approaches you can use on large company's including Enron style accounting fraud but clearly it's much simpler with small ones. Other options include http://www.paulgraham.com/submarine.html where you try to hype the market segment not any of it's products. But a far more legal approach is to simply kill off the R&D program and look for a sucker/greater fool to buy the rotting shell which looks great on paper.
So as long as all big companies in a particular sector waste X on consultants, that's fine for the shareholder.
That's incorrect. As a shareholder, I can sell my stock and reinvest the proceeds into a company in a whole different industry. Thus, companies must compete for shareholders.
I don't think that's true because customers cannot arbitrarily change industries and so even a very inefficient industry can be just as profitable as any other. As a shareholder you buy profitability, not efficiency.
Of course the likelihood of a more efficient competitor entering a market becomes higher the more inefficient the incumbents are. There are more than enough examples for that.
Consultants are often brought in order be blamed later. In the article, the development company could always try and blame BCG when their shareholders wonder how come $1B was wasted. By that time, the CEO of the development company would have left deploying his golden parachute, and BCG would have been able to somehow cover their legal ass with some small print on a back of their contract agreement.
Maybe the presumption of connections is all that is needed. Managers have connections. They need to hire people with connections because connections are important.
"I’m a free marketeer. I believe that voluntary exchange is not just a good method of incentivizing people to provide their labor and talents to society, but a robust moral system — goods and services represent tangible benefit to people, market prices represent the true value of goods in society, and wages represent the value that a worker provides to others. Absent negative externalities or monopoly effects, a man receives from the free market what he gives to it, his material worth is a running tally of the net benefit that he has provided to his fellow man. A high income is not only justified, but there is nobility to it."
Oh, man, it'd be awesome if we had that. But then, much of the Web 2.0 "industry" about which this site revolves would not exist.
I found that quote particularly hilarious given the article in which it is embedded. The article would make a good reference for the wikipedia article on cognitive dissonance.
He invokes Excel as an analytical engine several times in this story. I am trying to figure out if he actually considers it to be a powerful statistical engine, or if he is merely using it synecdochically for the benefit of non-technical readers, in order to represent statistical software more generally.
It actually is the de-facto-standard modeling engine in a lot of areas, even some scientific areas, but mainly economics/finance. There are some pretty nuttily complex simulations written entirely in Excel, with the visualization part of the simulation done by popping up a chart--- you can even make it animated by popping up a new chart at a certain time interval. There's even a market in commercial spreadsheets, which you buy and load sort of like libraries: http://www.palisade.com/RISK/
Not necessarily a good idea, but somehow it caught on. One possible reason is that it was one of the earlier widely available pieces of software for doing declarative, dependency-based modeling that auto-propagates updates: if box A and box B are linked by a "B = 2*A", then B auto-updates whenever A changes, without you manually writing a propagate-updates loop. You can now do stuff like that in a lot of languages, but it's relatively recent (e.g., it's one of the new features JavaFX variables have).
Spreadsheets are the most popular declarative (or zero order functional) languages in the world. There were even talks about spreadsheets on the International Conference on Functional Programming 2009.
You can now do stuff like that in a lot of languages, but it's relatively recent
Saying "Lisp had it X years ago" sounds perhaps a little weenish, but... that sounds a lot like the Cells library, and the even older Garnet KR. Granted, they're quite a lot less accessible than spreadsheet programs.
FRP seems to be modern take on it. It's being very actively researched in the Haskell community.
Visicalc: 1979. Excel: 1985. Garnet: early 1990s. Cells: 2000 or so.
On the other hand ... Sketchpad: 1963. (Constraint satisfaction, but not embedded in a general-purpose programming system.) Prolog: 1972. And Guy L Steele wrote a nice general-purpose constraint system in 1978. ("Constraints", MIT AI Memo 502.)
Twenty-plus years ago I wrote a complete blackjack game in a spreadsheet, all using 1-2-3 "slash" macro commands (not VBA or anything like that). It even did insurance and doubling-down. I was part of the team testing the product, and each of us on the test team built a different casino game -- one guy did craps, and found a bug in the random number generator.
Once you get your brain around the paradigm, it can be a powerful tool.
The 'Solver' (http://www.solver.com/) tool in Excel is widely used for many business optimization problems. If you have x & y quantities of two raw materials and products A and B consume different proportions of each raw material, then you can use the solver to determine the most optimal production strategy that maximizes your profit (or minimizes your labor requirements etc.)
There are multiple versions of Solver. To get the free one to do this requires a hack (using some sort of Fourier Transform into a cell or something, I think there are multiple ways). There are paid versions of Solver that are far more powerful, with fully developed APIs. Also, Iron Python can be used with Excel, which makes the whole thing really intense because many Python Libs can be used. Excel truly is Microsoft's shiniest, best piece of software.
> Excel truly is Microsoft's shiniest, best piece of software.
I would grant that honour to SQL Server. In fact, I regard SQL Server as Microsoft's third best product, lagging behind both the Natural Keyboard series (a must) and their mice ("honest value", reliable and comfortable). Never thought that, but Excel could be the fourth product in this list.
Excel is scriptable by COM and therefore VBSript, Python+PyWin32, and any other COM scripting language.
Presumably you mean IronPython integration in a different sense due to it being a .Net library? Got any links with examples of how that looks / what it can do?
You are totally right, it had been a while since I had looked into this. I was confusing (blending together?) pyinex and IronPython. You are right, IronPython (and tons of other languages) all have access to the .Net libs, but pyinex is what I was thinking of. Apparently, though, it is not fully developed yet.
I was thinking you were going to refer to .Net linking with Office, which seems to be something different from the COM automation, and more complicated than I've ever been interested in.
That, however, looks pretty darn cool. On the odd occasion I've used Python/COM/Excel together, I've really wished for a Python shell inside Excel to do things like:
for cell in Range('a1:a10'):
cell.Value = cell.Value.split('-')[0]
or whatever. I don't know if Pyinex will quite do that, but thanks for the link!
You can do almost exactly that in Resolver One (http://www.resolversystems.com/), which has got a Python console as well as allowing Python functions and Python syntax in the grid. It's a separate spreadsheet program, though, not an Excel plug-in.
Alternatively, there's PyXLL (http://www.pyxll.com/), which lets you write Excel user-defined functions in Python, but doesn't have a console.
I've seen Solver used by a number of accountants to say 'I need my profit to be this number, what figures do I need to change to hit that?'. Solver is a life saver for those looking to cook the books (sadly far too many people).
In high school there was a girl in my class that preferre to do everything in excel. And that included writing papers, because it made the formatting easy.
I think his point is that Excel is a powerful weapon in the right hands. Most people don't do much with it, but it's powerful none the less. If dollars were points, many trillions in commerce and complex decisions have been made on the result of analysis done by spreadsheets.
The problem is, his description of his morality crisis don't quite match with his actions.
He did quit, but it was probably because everyone else saw the ship sinking and was jumping off.
His $16k "sacrifice" at the end was not much if he claims he would have made enough to retire by 30s and just live off interest. So, yes, he had a bit some moral struggles, but it sounds like he managed to successfully "overcome" most of them via rationalizations.
The blog post was written just to make himself feel better and to somehow turn not taking a little bit of hush money into a great moral victory. Perhaps his future employee will read how honest and devoted to the truth he is...
I'd never heard of it before. I too assumed that muting the sound was the idea, he mentioned he was staying at a hotel, so I guess screaming would have raised some serious suspicion. I wonder if the sound would travel down the drainpipe, though.
I don't think this is specific to business consulting, or to Dubai. I know several people who were hired by high-powered technical consulting firms here in the US; all of them were fairly bright, attractive young people with very little experience of any sort.
He even said that he decided that he would rather have a "hypothetical children" have a rich morally bankrupt father that could pay for college than one with integrity.
because he spent that entire article telling us how great he was at rationalizing selling out. he pretty clearly had enough practice that he could've handled one last rationalization.
as far as judgment, i don't consider attempting to predict someone's behavior a judgment. i didn't say "he is an awful person". that'd be judgment. i was implying, though, that you shouldn't be impressed by his turning down $16k. the only thing that tell us about him is that his price is above $16k, and below $200k/yr.
and, there was no giving up of his job, in the end. i quote: "I was not surprised the day I lost my job."
"Absent negative externalities or monopoly effects, a man receives from the free market what he gives to it, his material worth is a running tally of the net benefit that he has provided to his fellow man"
I'm not surprised that someone whose ideology makes him believe that Einstein's contribution to society was smaller than that of the bosses of Lehman or AIG would be disappointed by reality. Or is it that reality itself is a "negative externality"?
No, I think the issue is one of faulty interpretation of that ideology. It's a serious mistake that people make all the time. They mix up statistical probabilities and individual causality. The average efficiency of markets includes scams as well as geniuses. It includes people who contribute a lot but market themselves badly and it includes the exact opposite.
I'm not surprised that someone whose ideology makes him believe that Einstein's contribution to society was smaller than that of the bosses of Lehman or AIG would be disappointed by reality.
Would you care to clarify? I genuinely don't see where you are getting this from.
Einstein did not contribute to the market, and thus shouldn't be judged by that. You could say he gave his insights away as gifts (or in exchange for reputation?).
The author of the article says "wages represent the value that a worker provides to others". Do you really think Einstein's wage represented the value he provided to others?
People work for all kinds of reasons. Money is just one of them as you yourself allude to when you mention reputation. So wages representing the value a worker provides is clearly nonsense.
They just represent _expected_ value for those able to pay, and it includes all kinds of distortions like immigration controls.
I guess Welcome the Real World, is the best response I can give. So sorry that the real world is so non-idealistic and disappointing to you, and that your wonderful skills and knowledge aren't being prized and utilized.
In other words, you're experiencing the reality shock _everybody_ experiences when engaging with, and learning about, the corporate world.
It seems you'd be happier in Academia, a research institute, or perhaps creating something on your own.
It's not the Real World, it's just a certain part of it. Not a small part, but not all of it either. There are a lot of places that offer a chance to do far more satisfying work.
(BTW I'm not sure I'd recommend academe for someone with his mindset. The politics are perhaps even worse and the monetary gains much lower. A startup - even though far from the Disneyland some HN posts paint it as - could be a good place for someone like that)
You're right. That youthful energy and talent are likely to be utilized best in a purely creative start-up. That was the idea with the creating something on his own suggestion.
“Find me a rock” problems sound dead simple, but in actuality have requirements that are poorly stated or unknown. You never know what you’re looking for; you only know that you’ll know it when you see it.
Even better perhaps: "you only know that someone else will know it when they see it".
What an amazingly insightful article. Props to the author for speaking up. Yet, slightly dissapointed that he did not leave out of his own accord, but waited to be laid off.
In his own reasoning "I’ve come to the conclusion that having a father who can pay for a top-notch education outweighs the disadvantage of being raised by a hypocrite."
Acting as if financial success equates to dishonesty.
While in the very same piece the author praises free market,
and money in exchange for true value does not compute. Does he believe, or not believe in the power of a free market,
or has he come to develop a disbelief in honest trading?
Something that leaped out at me: "I believe that voluntary exchange is not just a good method of incentivizing people to provide their labor and talents to society, but a robust moral system".
Voluntary exchange is not a moral system. A free market doesn't have morals.
The author of the submitted article may have more sense of history than most Americans. It is a historical fact that Adam Smith first wrote a book The Theory of Moral Sentiments
in 1759, pondering the issue of why people behave morally when they could simply guard their own self-interest. As Smith pondered the issue more, he wrote An Inquiry into the Nature and Causes of the Wealth of Nations
in which he discussed how free-market trade provides incentives to moral behavior. EVERYONE who is well educated should recognize this quotation:
"But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and shew them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher the brewer, or the baker that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity, but to their self-love, and never talk to them of our own necessities, but of their advantages."
In other words, society can be structured so that people will help you or other people who need help while looking out for number 1.
Smith's overall conclusion on the relation between morality and free markets is a bit more mixed than that of someone like Hayek, though. He does say things like the excerpt you quote quite frequently, but he also has a number of comments lamenting the immoral behavior that profit motives cause, like an encouragement to fraud and collusion. He does worry that some attempts to solve the problem would be worse cures than the disease, but he doesn't think that no problem exists, or that self-interest always produces moral outcomes, or that government regulation to mitigate the immoral effects of self-interest is always wrong.
His policy proposals on that latter point are pretty pragmatic, and he endorses regulation when he thinks it has relatively large gains for relatively small downsides. For example, he proposes that the government ought to require employers to pay their employees in hard money, and not permit them to pay in promissory notes or in goods. His reasoning is that this prevents unscrupulous employers from tricking employees, either by paying them in goods whose value has been misrepresented, or by convincing them to work for promises of payment that the employer doesn't really intend to keep.
You have completely missed the point. Contrasting economic systems is completely irrelevant.
The choice here is not between different economic systems, but between different moral systems.
You cannot make a free market your moral system because markets are amoral. That is, it is not that they are not immoral and so should be replaced with something else; rather, they have no moral content - morality comes from somewhere else.
You can pay someone to punch a third party in the nose. You get the value of knowing that someone is going to get hurt. The other guy gets your money. The transaction, in the free market, by itself has no moral content, though. A free market just means exchanging value for mutual gain. It doesn't say that those values have positive or negative moral worth.
Your use of "moral content" is entirely ambiguous, because that content will vary depending on which moral system you refer. And since a market is essentially an amalgamation of individuals (whom likely have or are capable of inducing moral content through their actions and desires), it is likely that a market has a great deal of moral content regardless of which system you pick.
Capitalism believes in a government which protects private property and human life with physical force. You can pay someone to punch someone else, but that's inconsistent with capitalistic philosophy.
Why would a government protect human life with physical force? Remember, the justification must be from a free market, not with reference to some other moral system.
What, in a free market moral system, prevents slavery? The justification must come from the free market, if free market is to be the moral system.
The justification must come from the free market, if free market is to be the moral system.
How can there exist a free market without the guarantee of the protection of private property? Without that you have anarchy (whoever is physically strongest wins).
I've never heard of someone invoking the idea of a "free market" without implying that the agents of the market are protected from physical harm.
In an anarcho-capitalist society, law enforcement, courts, and all other security services would be provided by voluntarily-funded competitors such as private defense agencies rather than through taxation, and money would be privately and competitively provided in an open market.
You continue...
> > What, in a free market moral system, prevents slavery?
> The government.
No. Slavery is prevented because the income generated by those would-be slaves is less than the income generated when those people fill the role of "consumer".
Also, if there are non-consensual exchanges, then by definition it is not a free market, but that simply avoids the question...
How do you figure that prevents slavery? It doesn't prevent slavery right now... buying a russian sex slave and making her work 12 hour days in a club seems to generate a lot more income than she would as a "consumer".
Hmmm. I gave this a little thought as I drove home, and I think I've got the answer.
On the whole, both regulation and the free market are able to deal with most of slavery. But at the margin, it becomes cost-ineffective to mop up the very last instance. In both cases, the instance is low enough that most of us will never come face-to-face with slavery. But ferreting out one more evil person costs society more than it would benefit.
I'll give you that. I wouldn't expect to see rampant slavery in a truly free-market society. There aren't many people who would voluntary choose to become one, though no doubt they exist. And I definitely agree with you that it's too expensive to try and eliminate ALL slavery (not just in dollars, but in rights.)
The thing that scares me about a truly free market without regulation are issues of coercion. Force may be eliminated, but there are so many other ways to take advantage of compromised people. Drug addicts, homeless, desperate parents, etc. Also, for a truly free market to work, you need enough information on both sides for people to make educated choices, but either side would prefer he have the information advantage.
Basically, I just don't see it working any better than the current system, but perhaps it would.
You are completely incorrect, the free market is a moral system because it does not rely on coercion or force to compel others to interact. All interactions in a free market system are voluntary and beneficial to all participants in the transaction. No other economic system can make those claims.
Firstly, 'The free market' can never be 'a moral system'. The first term refers to a system of trading, where goods and services are interchanged and relative monetary values are established. The second refers to sets of principles, reasons and motives for doing certain things. The first is at most a subset of the second, but that is only the case if you amend it with a philosophy that equates monetary value to moral value.
Secondly, your view of free markets is naive. Lack of transparency and the problem of monopolies are only a few of the many problems that completely free markets suffer from. We have an FTC, because markets need to be regulated. Leaving them completely free leads to morally unacceptable results.
It can be beneficial to all "participants" but disastrous to society as a whole, can it not? Look at the current rage against free market instruments like CDOs and other complex unregulated derivatives.
Are you really claiming we dont need "coercion or force" from regulators like the SEC or FTC?
Are you really claiming we dont need "coercion or force" from regulators like the SEC or FTC?
It is naive to think any one human agents or regulatory agency is able to prevent those "complex unregulated derivatives" or not be corrupted by unethical firms/special interests/etc.
The free market system already have a "fail-safe" or "regulatory" function through the bankruptcy of entrepreneurs and rewarding prudent entrepreneurs with the leftover possessions of the bankrupt one. Failure is at the heart of the free market enterprise system. It is a feature, not a bug.
It is those who wishes to prevent these failures at all and any costs that keep our society stagnated or hurling down to its destruction as they keep funding economic activities that is out of reality with human needs and desire.
Wow... taking @dantheman's statements a bit too literally maybe? There are very, very few free market proponents who would be in favor a pure free market. Just about everyone agrees that some degree of regulation is necessary (or else paying for a murder would be a proper free market transaction).
People can be coerced by their circumstances; but that's beside the point.
You can hire someone to murder someone else. Nothing wrong with that transaction in a free market. Similarly, you can be a credit card processor for child pornography - you take your cut, but since you don't do the deed, it's not your problem.
Do you see the problem?
(Hint: morality isn't emerging here. It comes from somewhere else.)
And I have no idea why you mentioned some "other economic system". I didn't. Why? Because I wasn't contrasting economic systems. I was contrasting moral systems.
But some moral systems are consequentialistic [1] and for its proponents, the means are justified by the ends. A free market could be seen as a means to reach the moral end. Thus, they are often mixed up.
I suspect (some) people misunderstood what I was trying to say.
I wasn't trying to say that I thought free markets were immoral, or that they were not moral. (And so we should find a different economic system, or something).
I was trying to say that you cannot replace your personal morality, your moral system, with a free market (whatever that even means). That is, I was trying to say that markets were amoral, without moral content.
I think some of it comes from confounding a moral system (i.e. a system for evaluating the morality of an action) with a system which acts in a morally correct manner.
Not at any of the small businesses I ever worked for, where the guys at the top probably decide these things themselves.
Not at a very, very large business I worked for, where the guys at the top probably didn't know the name of anyone in my building and everything was done by HR and Legal automatons.
And not at any medium sized businesses I have ever worked for, either.
The only time an agreement like this is standard is when you know you're doing something you shouldn't be, and you know you're about to lose your legitimate influence over people who could out you, so you try to buy their silence because to you the cost is cheap.
Hmm. What I meant to get at is that the clause seemed more likely to relate to the "we didn't discriminate against you in letting you go" thing, which he also mentions. In other words, not only will you not sue us for discriminating against you, you won't go around saying we did either.
Bottom line, I think it's much more likely that he's misinterpreted the document than that they're trying to silence him.
What are they afraid of, that he'll reveal big consultancies tell clients what they want to hear? That's not really a news flash, is it?
The only time an agreement like this is standard is when you know you're doing something you shouldn't be, and you know you're about to lose your legitimate influence over people who could out you, so you try to buy their silence because to you the cost is cheap.
What country are you in? In the UK this is pure boilerplate text.
I'm in the UK, and I have never had anything even close to this proposed to me, by any employer, of any size, regardless of how happily I left.
It's only boilerplate text if you're the kind of person who also accepted the "We own copyright to everything you ever do, at work or otherwise" clause in the employment contract.
I've been laid off twice, and both times the severance agreement included clauses that I basically agreed not to sue them for unfair dismissal. When I've quit, of course there was nothing like that.
It's pretty standard at both banks and large tech companies that when they make you redundant or fire you that they ask you to sign something similar. I'd be surprised if say Google or Microsoft didn't have something similar in their standard redundancy pay-out contracts.
Yes. It's normally only the case when the company asks you to leave. If you google for "non-derogatory statements" you can find plenty of discussion about such clauses.
In college, I used to debate with myself on which career was better, ibanking or management consulting.
In the end, I chose to pursue management consulting, which I've been doing for the last 2 years.
Now, I debate with my friends on which career is worse, ibanking or consulting because frankly, after sifting through so much corporate BS, I've come to realize that all these jobs need to be prestigious in order to get ivy league grads to pursue them. In reality, we're either glorified excel junkies, or overpaid powerpoint formatters.
I'm crossing my fingers now hoping that this start-up I'm working on takes off... I really do want to leave the corporate world for good. The realization that the preparation we had in college is absolutely useless in the real world, and that any semi-intelligent high-schooler could do our jobs is a depressing thought.
If by, "broken window fallacy in reverse" you mean "pointing out that the broken window fallacy is a fallacy", yes. He is troubled by the fact that he is earning money by breaking windows.
I thought this example was well chosen. Downloading mp3s is a familiar thing that's very easy to do, but may not be ethically defensible in the final analysis.
If you want to have a discussion about copyright though, you're poisoning the well by calling infringement stealing.
I interpreted this as meaning "it's obvious that it's wrong but since it's hard to directly connect with the victim the threshold for doing it is very low". I agree that it did come across a bit ambiguous as to his actual meaning. The perennial Simpsons quote "Shoplifting is a victimless crime...like punching someone in the dark" would've been a more direct illustration, at least if the author meant what I think he meant :)
I had a job like that. I was supposed to use my analysis and creativity to build models for client forecasting, but if they didn't confirm what the brand team wanted to hear, they'd be rejected. It sucked. I was fresh out of school and cared more about getting the right answer than appeasing clients.
I lasted 8 months in that job. No regrets about leaving.
Also, $16k is piss-poor for a severance package in a brand-name consulting firm like BCG. Given the economy and the likelihood of a necessary career change, OP should have asked for 6 months' base (including COBRA) and an "office firing" (you're terminated but can use office resources for the job search and retain the right to represent yourself as employed).
I think I missed the part where he had the leverage to make that kind of demand. Perhaps even the brand-name consulting firms have figured out that ridiculous severance packages don't make a whole lot of sense.
What I'm talking about isn't that ridiculous. Paying 6 months' salary is a small cost compared to the cost of a termination lawsuit or a negative article being written about the firm.
I'm guessing they gave him 2 months pay and nothing for the move back, from Dubai (which is a dangerous place to lose your job, by the way). They also seem to have given him nothing in terms of exit counseling.
To answer the question you raised: his article and the fact that it got published is the leverage he had. I bet it's circulating around BCG right now. It has the potential to be a morale and image problem, and not the Goldman Sachs style of image problem (where people hate GS but consider them good at what they do).
There are rational reasons for firms to pay decent severance packages. It's not just something they do to be nice.
It's the same everywhere. For example, people who are reselling SAP in, say, Russia, are doing exactly the same thing - tuning numbers and telling lies. The better you're able to lie the better SAP consultant you are.
There are no project with was completed on schedule and within budget.
I was contracting at a big three automaker and they had retained just such a firm, possibly even BCG, to "restructure" the IT department.
So they had a team of overpaid consultants come and perform an analysis. I won't even get into the pointlessness of all that. However, the leader of the pack, the alpha male of the consulting team, would physically walk his laptop over to a printer near the admin's desk to print because the information was too sensitive to print over the network.
In true hacker fashion a buddy and I had recently discovered that you could telnet into the printers and with a carefully crafted command actually set the text on the LCD readout on the printer itself. (The spot where is usually says "Load Paper") So we actually wrote a program that would allow us to send any text we wanted to any LCD of a printer.
So of course, this self important consultant became our first victim of the prank. He hooked up his laptop and we starting sending text like "Loading Virus" to the LCD. It actually became a little frustrating because he wasn't noticing the LCD.
Finally, he looked at the LCD and we starting sending text like "Downloading files from computer". This guy just went into an absolute panic and after the first few seconds of frantic inactivity he got his act together and closed the laptop. Of course, that didn't stop the printer from "Downloading files", so he finally ripped the cable from his laptop to sever the connection.
He was in a panic for what I'm sure were some of the longest seconds of his life, but by then we were doubled over laughing just a couple of desks away and he caught on.
I will give him credit for taking the joke well and he never tried to push it up the food chain or anything to involve any management.