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37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

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Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#111

Post by icebraining »

briandear wrote: post #90
kenko wrote: post #70

Earlier quoted context omitted.

??? Customers won't give you, hapless employee, job security if your employers can easily replace you with someone cheaper because you have a flimsy (or no!) contract, nor will customers help you with disputes with management, or wrongful termination, or promotion from within, or even the too-little-emphasized increased potential for synergy between the ranks that unions afford, or any of the many other things that u…

You shouldn't need a contract if you're adding value to the organization. If you can get replaced by someone cheaper, then you weren't worth what you were getting. Why the heck should a business pay more for the same outputs? If you're adding more value than you cost, your job is always safe. The union mentality is exactly the reason American manufacturing has left for cheaper pastures. Union employees aren't about a…

American manufacturing didn't leave. The US manufacturing output has doubled since '75, and it's bigger than Germany, France, Brazil and India combined.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#112

Post by typicalrunt »

kenko wrote: post #95
briandear wrote: post #90

Earlier quoted context omitted.

You shouldn't need a contract if you're adding value to the organization. If you can get replaced by someone cheaper, then you weren't worth what you were getting. Why the heck should a business pay more for the same outputs? If you're adding more value than you cost, your job is always safe. The union mentality is exactly the reason American manufacturing has left for cheaper pastures. Union employees aren't about a…

Let's stipulate to the first sentence of your comment (and ignore everything that comes after it). If you're adding value to an organization, you shouldn't need a contract. Wonderful! There you are, being a positive influence on your organization, knowing that you shouldn't need a contract. But! Suppose some manager doesn't recognize that you're being a positive influence? Or just wants to throw his weight around? Ce…

I don't want to mar the conversation with a pro or anti union debate. Let's take it out.

You have to turn those "what ifs" into "so whats" because there is always the chance that a manager is going to fire you unjustly. If the organization is setup properly, the loss of your employment would adversely affect your department's profit numbers. Since the manager is responsible for those numbers, one can assume there will be repercussions for a decrease.

This all assumes that the organization is a well-oiled machine, but since a vast majority aren't, you have to assume that you will be fired for any reason. The good thing is that if you can provide value to one company, you may have a good chance at providing value to another company (especially if it can be quantified on a resume). These are known as transferrable skills, and they're what good employees retain in order to get a high-paying job.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#113

Post by rdl »

tptacek wrote: post #44
rdl wrote: post #29

Earlier quoted context omitted.

A board seat is a lot different from just holding equity. I own HPQ, RIMM, and YHOO, and if I had a board seat in any, my push would be for sale and getting rid of everyone above the first layer of management and engineers. (Boardmembers can't do this directly, but can work with shareholders and management, and ultimately hire competent CEOs)

And? It's not like we have to read tea leaves out of his board memberships to see how Jason Fried runs a business. He runs a famous business himself.

It gives an unwarranted endorsement to GRPN; their business practices are fairly reprehensible, so if a marginal investor or marginal small business customer gets screwed because a well respected guy lent credibility to their board, it's a poor choice for him.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#114

Post by saraid216 »

davidw wrote: post #109
saraid216 wrote: post #103

Earlier quoted context omitted.

Is Google Search a "product" or a "service"?

Unless Google has legions of Oompa Loompas hiding in its server rooms running around retrieving data as queries come in, it's a product that provides a service: it does not scale linearly with the number of people working on it. Put another way: each additional cleaning lady client consumes more of her time, and pays her more money in a fairly linear way. Google search users do not fit that pattern, and, more importa…

You realize that there exist more than two business models in the whole of the world, right?

Where do you get this strange taxonomy of "products" versus "services" anyways?

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#115

Post by hackinthebochs »

philwelch wrote: post #105
kenko wrote: post #98

Earlier quoted context omitted.

God knows the first thing I do when deciding whether to shop at a supermarket is find out whether it's unionized, and avoid it if it is.

If there's two supermarkets in town and one is unionized, the other one will probably be better for the customer in some way, usually because they'll have lower prices. Customers either don't care about unions or slightly favor them, but the end results of a union do drive customers away. I don't think it's at all arguable that unions--at least American unions--are detrimental to the health of the businesses their em…

Unions are simply a balancing force to that of the management whose sole purpose is to extract as much profit from the enterprise. Yes, a lot of bad things can happen when unions gain too much power. But that doesn't mean unions are necessarily evil. On the contrary, they are a necessary evil, as a balancing force of the evil of the profit incentive.

The free market generally does not have the power to correct for overreaching management. In many cases the signal necessary to make a judgement is not propagated to consumers, at least not in such a way that it will cause a change in consumers purchasing decisions. This is where unions are necessary to correct against overbearing and unrealistic management. Society is stronger, and the economy is stronger, when the "wealth" of a nation is well distributed among everyone. Wealth here being everything from health, leisure time, assurances against bodily injury, etc. Unions are but one tool to ensure this equitable distribution.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#116

Post by Lukeas14 »

briandear wrote: post #90
kenko wrote: post #70

Earlier quoted context omitted.

??? Customers won't give you, hapless employee, job security if your employers can easily replace you with someone cheaper because you have a flimsy (or no!) contract, nor will customers help you with disputes with management, or wrongful termination, or promotion from within, or even the too-little-emphasized increased potential for synergy between the ranks that unions afford, or any of the many other things that u…

You shouldn't need a contract if you're adding value to the organization. If you can get replaced by someone cheaper, then you weren't worth what you were getting. Why the heck should a business pay more for the same outputs? If you're adding more value than you cost, your job is always safe. The union mentality is exactly the reason American manufacturing has left for cheaper pastures. Union employees aren't about a…

Comparing Google to auto manufacturers that employ mostly union labor is not fair because the supply and demand curve for employees is completely different. When a potential employee goes into an interview at Google he/she knows that they are in short supply and high demand. This gives him/her leverage to negotiate salary, work conditions, etc. Google provides such a great work environment because they know this and are proactively meeting the demands of the candidates they're trying to attract.

Most employees at auto manufacturers do not have this same leverage. They can't threaten to leave for higher salaries or better working conditions because they are in large supply, small demand. Forming a union gives them this leverage so that they can negotiate at the same level as their employer.

I feel like the negativity towards unions is a result of some recently holding more power than the employers and getting unsustainable pensions and other extravagant benefits. But when the balance of power is closer then unions have been successful and often in necessary in making sure that employees are working in a safe environment, getting paid a living wage and generally not being taken advantage of.

TLDR; Labor unions are not all bad/good. They simply give employees the same leverage as their employers in industries where the supply for workers outnumbers the demand. It's not good for that balance to get out of hand in either direction.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#117

Post by philwelch »

hackinthebochs wrote: post #115
philwelch wrote: post #105

Earlier quoted context omitted.

If there's two supermarkets in town and one is unionized, the other one will probably be better for the customer in some way, usually because they'll have lower prices. Customers either don't care about unions or slightly favor them, but the end results of a union do drive customers away. I don't think it's at all arguable that unions--at least American unions--are detrimental to the health of the businesses their em…

Unions are simply a balancing force to that of the management whose sole purpose is to extract as much profit from the enterprise. Yes, a lot of bad things can happen when unions gain too much power. But that doesn't mean unions are necessarily evil. On the contrary, they are a necessary evil, as a balancing force of the evil of the profit incentive. The free market generally does not have the power to correct for ov…

> Society is stronger, and the economy is stronger, when the "wealth" of a nation is well distributed among everyone. Wealth here being everything from health, leisure time, assurances against bodily injury, etc. Unions are but one tool to ensure this equitable distribution.

I'll agree with that, but I think regulation and Big Government™ are a better solution and unions have outlived their usefulness. You can tell because most people who advocate for unions just rest on past glories.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#118

Post by aswanson »

stanfordkid wrote: post #100

lifestyle businesses are great. but to make real money you need to scale -- I think this stuff is okay for the size of business they are aiming for but if you want to build something that can be acquired for 500m+ or IPO then you need to do some more strategic thinking.

Several million a year isn't 'real' money?

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#119

Post by rhizome »

philwelch wrote: post #105
kenko wrote: post #98

Earlier quoted context omitted.

God knows the first thing I do when deciding whether to shop at a supermarket is find out whether it's unionized, and avoid it if it is.

If there's two supermarkets in town and one is unionized, the other one will probably be better for the customer in some way, usually because they'll have lower prices. Customers either don't care about unions or slightly favor them, but the end results of a union do drive customers away. I don't think it's at all arguable that unions--at least American unions--are detrimental to the health of the businesses their em…

What do you mean by "will probably be better?" I have to think there's plenty of real-world evidence to obviate that hedge by now.

Re: 37signals Earns Millions Each Year. Its CEO’s Model? His Cleaning Lady

#120

Post by yummyfajitas »

hackinthebochs wrote: post #115
philwelch wrote: post #105

Earlier quoted context omitted.

If there's two supermarkets in town and one is unionized, the other one will probably be better for the customer in some way, usually because they'll have lower prices. Customers either don't care about unions or slightly favor them, but the end results of a union do drive customers away. I don't think it's at all arguable that unions--at least American unions--are detrimental to the health of the businesses their em…

Unions are simply a balancing force to that of the management whose sole purpose is to extract as much profit from the enterprise. Yes, a lot of bad things can happen when unions gain too much power. But that doesn't mean unions are necessarily evil. On the contrary, they are a necessary evil, as a balancing force of the evil of the profit incentive. The free market generally does not have the power to correct for ov…

The free market generally does not have the power to correct for overreaching management.

Can you explain this claim? Specifically, why "overreaching management" is bad for consumers, and why the market can't correct for it?

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