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Fellow Engineers: This is where your money comes from

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Re: Fellow Engineers: This is where your money comes from

#31

Post by bitL »

wwalser wrote: post #27
sumeno wrote: post #11

Earlier quoted context omitted.

You must have worked at some really terrible companies. While I don't doubt this is the case at some places the places I've worked haven't been like this at all.

Yeah, reading stuff like this is depressing. It's completely reasonable to understand and be cautious of the these things happening, but coming to the belief that this encompasses the whole of reality is unfortunate. (maybe that's not what gp meant…) It's important for engineers to understand that they have options. If you're being mistreated, move on — if people are claiming credit for your work* there are places th…

I wanted to point out that this happens very often; Game of Thrones nor House of Cards aren't completely fiction and people change rapidly when a potential wealth gain is at stake. The dominance game is very real and people probe for your weaknesses all the time, trying to exploit them and hack you for their benefit. Cover your back at all times and never put all your eggs in one basket. Push to become independent as much as you can and your talents allow.

Re: Fellow Engineers: This is where your money comes from

#33

Post by rileymat2 »

WalterBright wrote: post #28
rileymat2 wrote: post #22

Earlier quoted context omitted.

Many words have several definitions. Some more specific and some more general as used by the public. You are right in an accounting sense, but not in the complete definitional sense.

If he did conflate "profit" with "gross revenue", I was explaining that indeed he was getting a share of it. And frankly it is impossible to have any sensible discussion about business and be confused about what profits are - the only definition that has meaning is the accounting definition. It's like discussing newtonian mechanics and confusing momentum with energy.

People routinely use a more loose definition of the word productively, for instance the term "profit sharing" is commonly understood. But as you point out, unless it is through dividends from stock grants/options, whatever is shared with the employee no longer is profit.

Re: Fellow Engineers: This is where your money comes from

#34

Post by angersock »

WalterBright wrote: post #10
throwawayjava wrote: post #7

> This is why I struggle with scenarios where people discuss pay and work without considering value. 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 whol…

> getting 99% of the profits? Profits by definition are calculated after labor costs are deducted, so employees get 0% of the profits in salary. However, take a look at your company's accounts and see how much of the gross revenue is paid out as wages and salary. It'll be a big chunk. There's your share.

Who drives the better cars, has better vacations, and better real-estate?

Re: Fellow Engineers: This is where your money comes from

#35

Post by gaius »

foobarian wrote: post #4
nawitus wrote: post #3

"If you want to increase your compensation over time, continue to put yourself in a position where you can deliver the most value." 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).

Simple rule of thumb for enterprise, make your bosses look good.

make your bosses look good

And get a pat on the head while he or she gets the cash.

Re: Fellow Engineers: This is where your money comes from

#36

Post by katastic »

WalterBright wrote: post #12
bitL wrote: post #9

Real-world: - 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 you…

If you're doing work-for-hire, the company implicitly owns whatever it is you achieve and was paid for. If you want to own it, start your own company!

Want money?

Step 1:

- Start your own country.

Or try one of the many alternatives:

- null set

Re: Fellow Engineers: This is where your money comes from

#37

Post by ACow_Adonis »

bitL wrote: post #14
sumeno wrote: post #11

Earlier quoted context omitted.

You must have worked at some really terrible companies. While I don't doubt this is the case at some places the places I've worked haven't been like this at all.

I worked for the companies considered "the best" in our industry with Glassdoor rating >4.5 at various stages of their lifecycle. This was happening everywhere, with singular pockets of progressive parts of company that were immune to that. At worse companies you can directly observe sexual or financial relations between managers and subordinates and resulting quick path to success as well, demoralizing the rest. Tec…

Glassdoor is fascinating for all the wrong reasons. I've now worked in charity/community, private sector, and government, for big, small and medium.

During my last switch (from private back to government), i noticed what I'll call the "reverse glass door" effect while browsing their profiles. It was weak but it was there. That is to say, if i had to take all the employers, consultancies and corporations I've had to deal with, and rank them from places I've enjoyed myself at the most to places where I would have to genuinely ask whether there was a wage they could pay me to make me work with them again, it seemed that the workplaces I considered the worst held the highest glassdoor star ratings, and my favourites have consistently been around the middle of the pack.

As a statistician I've even considered naming and investigating this effect: explicit rating systems that end up being the inverse of what they purport to be measuring, and I've got some theories as to what could be behind it (me being abnormal, such firms having the resources/need/desire to manage their image the most, high turnover and getting new people to leave such rankings during their honeymoon period), but I've not got round to doing it with any rigor...

Re: Fellow Engineers: This is where your money comes from

#38

Post by WalterBright »

throwawayjava wrote: post #26
WalterBright wrote: post #10

Earlier quoted context omitted.

> getting 99% of the profits? Profits by definition are calculated after labor costs are deducted, so employees get 0% of the profits in salary. However, take a look at your company's accounts and see how much of the gross revenue is paid out as wages and salary. It'll be a big chunk. There's your share.

Sorry, but I think that this view is both obviously wrong and actively harmful. It's an example of where going with textbook definitions actually obfuscates reality. Highly compensated managers are taking a share of profit, often quite literally (look at how VP and above positions are compensated). But always indirectly -- you can't tell me a 7-8 figure salary "isn't a share of profit". That's obvious BS. And if my o…

The money paid to employees is deducted from the profits (or more precisely, profits are what is left after expenses and labor costs are paid).

So your salary is your share of the profits in any pragmatic sense.

This isn't MBA level stuff, any basic accounting course will explain it. In fact, I recommend anyone who cares about this sort of thing to learn basic accounting principles - it is simple, and highly useful knowledge. You'll be able to then read a business's Income Statement and Balance Sheet, and see where the money comes from, where it goes, and where it is allocated.

Re: Fellow Engineers: This is where your money comes from

#39

Post by throwawayjava »

WalterBright wrote: post #38
throwawayjava wrote: post #26

Earlier quoted context omitted.

Sorry, but I think that this view is both obviously wrong and actively harmful. It's an example of where going with textbook definitions actually obfuscates reality. Highly compensated managers are taking a share of profit, often quite literally (look at how VP and above positions are compensated). But always indirectly -- you can't tell me a 7-8 figure salary "isn't a share of profit". That's obvious BS. And if my o…

The money paid to employees is deducted from the profits (or more precisely, profits are what is left after expenses and labor costs are paid). So your salary is your share of the profits in any pragmatic sense. This isn't MBA level stuff, any basic accounting course will explain it. In fact, I recommend anyone who cares about this sort of thing to learn basic accounting principles - it is simple, and highly useful k…

> So your salary is your share of the profits in any pragmatic sense.

Okay, so I'm getting a tiny fraction compared to everyone else. Again, this is a fairly pedantic tangent and no matter how we define these things, my observation seems to be accurate.

Again, this sub-thread about the definition of profit is both tangential and unrelated to my original point. I think the standard accounting definition is pretty useless and silly in the context of modern large firms, but that seems like a discussion for another day.

> This isn't MBA level stuff

By MBA stuff I don't mean "useless econ 101 terms". What I mean is "aligning engineering talent with value creation", which AFAIK isn't taught is basic accounting courses...?

The author of the post suggested this alignment is an engineer's job. But the whole point of a firm is that the MBAs do that and the engineers focus on building things. That's my point -- that in the context of a large firm, the author is wrong.

Of course, joining a large firm means that your own compensation is disconnected from the value the firm creates. And that can mean less share of compensation, especially when the firm is doing well. But it also means you can make a good living without becoming a Monday morning economist.

I don't really care about defining profit "correctly" according to accounting terminologists because I think a well-meaning reader can completely understand the point that I'm making in my original comment without this aside.

Re: Fellow Engineers: This is where your money comes from

#40

Post by angersock »

"We get our money from customers" doesn't actually cover many other very real use cases. Let's try:

- We get our money from bosses who want higher headcounts to justify their position.

- We get our money from competitive poaching, so that if GOOG/MSFT/FB has us the other firms don't.

- We get our money from salespeople tricking customers into buying our products. This deception is easier if the products actually meet a need, but that isn't required.

- We get our money from VC firms playing pyramid games.

- We get our money from government grants that need to get spent or funding gets cut next year.

- We get our money from grants that have to be spent to show investment in "innovation" or "modernization".

- We get our money from selling out users to drive advertising clicks.

- We get our money because...BTC is stupidly volatile.

~

It's extremely naive, in the modern economy, to say "herp derp just deliver value to customers and you'll get paid what you're worth".

EDIT: Nice downvotes. Again, consider that maybe the modern economy is so twisted and weird in software dev that maaaaybe this simple Protestant work-ethic narrative doesn't actually hold water. Sorry to burst your bubble.

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