Fellow Engineers: This is where your money comes from

Fellow Engineers: This is where your money comes from
lianza.org

This assumes an efficient market. In the real world, however, value of a software engineer's output is really difficult to measure. Indirect value (like helping a team member) is even more difficult to measure than direct value (like implementing features or solving bugs and so on).

Dan Warmenhoven (when he was CEO of Network Appliance) had a wonderful way to very clearly explaining this in an accessible way. From gross margin to net margin to the fraction of the margin that was allocated to engineering.

But the other concept, on-off splits, is also something which I think managers need to understand a bit too. When I was at Google their compensation system tended to unfairly bias toward people delivering features and I and others argued for recognition of people that made delivering those features possible (which finally came about in 2009). As a manager you have to recognize when someone on your team or in your organization is helping the whole team work better or get more done. Whether that is an administrative person who is keeping things in the group calendar current or a tools engineer who is keeping the build running smoothly. If you're lucky they will be sick for a week and you'll see the entire organization hiccup as it adjusts. I say lucky because that will give you visibility into their contribution you might not otherwise have until it is too late.

Counter-point: firms exist.

If I'm the one figuring out how to create value, why the hell are the C suite, middle managers, and investors getting 99% of the profits?

So no, in the context of a large firm, it's definitely NOT an engineer's job to figure out how their skills align with market demand. And that's the whole damn point of a firm.

Now, this may be reasonable advice if I want to maximize by income. But maybe my goal is to maximize income under the constraint that "my excellent engineering" is the primary consideration in my performance evaluations. And there's nothing wrong with that; people trade income for all sorts of things. Telling someone not to make that trade-off is like chiding them for buying an expensive latte or sending their kids to an expensive private school. It's not your money, so it's none of your business.

edit: And, furthermore, the success of large firms and the high compensation available at those firms suggest that the author's advice might actually be actively harmful. As an engineer, you might actually be better off ignoring engineering-value alignment because you might be better off simply executing well within a well-oiled machine.

- you increase value; your bosses team up with each other and claim the credit; you might even get booed for some minor deficiencies whereas they will be boasting about their achievements

- you are generous and do non-AGPL based open-source; parasites are waiting in the open, incorporate your code to their commercial offering, never paying you anything; your bonus will be rude complaints about bugs in your code in your issue tracker

- you work for minimal salary and generous equity; when push comes to shovel, CEO will kick you out of the company due to "company problems" and claim your equity; bonus to the threat to your existence will be burnout from overworking and lack of credit

- your company creates a new opening for a lead position in your team for which you are the primary candidate; managers of other teams privately ask you if their friend can be pushed to your manager as the "one"