Friday, February 23, 2001

Even a raging capitalist has to take some time off. Today, I left work early to go to the San Francisco Food Festival, an extravagance made possible by the fact that my wife and I will be working a volunteer table. For the cost of an hour or two of my life, I'll be able to sample the cuisine of the finest chefs in San Francisco.

Whenever I do something like this (e.g. trade off time for money), I'm reminded of how many times I've heard an employee say, "We should spend $X, because it will more than make up for the cost in time saved." I find this a particularly egregious fallacy. Yes, there are times when you have to spend more in order to get a product out more quickly, but far too often this priniciple is invoked not to save time, but to redistribute it. To reduce tedious-but-essential work and increase interesting-but-useless work. To reduce the amount of time that people work, but without reducing time-to-market.

Let's get this straight: in a world in which everyone except consultants are on salary (more on them in a later entry), time is not money unless it reduces time-to-market. Saving time doesn't put money in anyone's pocket unless changes a timetable.

I also hear this fallacy expressed the other way, as in: "I'm so highly paid, it doesn't make sense for me to do X (boring but important), when I could be doing Y (exciting and prestigious)." That's a load of horsecrap. Unless I missed something, there's no magical black box that converts your time into cash!

Remember: the only time that saving time counts is when it actually increases profits. Any other attempts to save time are simply increasing leisure time--a worthy goal, but not on my payroll!

Thursday, February 22, 2001

For the past couple of weeks, I've been listening to Steinbeck's "The Grapes of Wrath" on my daily commute (no, not these guys). As a person, the massive dislocation suffered by the dust bowl farmers seems horrifying and sad: an entire way of life that had persisted for generations, destroyed in less than 5 years. As a capitalist, however, I wonder why it took so long.

For those who haven't read (or listened) to the book, the combination of the Great Depression, a ruinous drought, and poor soil management turned the midwest breadbasket into the "dust bowl," and forced the wholesale migration of the tenant farmers (who, like sharecroppers, did not own their land) to California. In their place rose the agribusiness industry, highly consolidated, heavily mechanized, and orders of magnitude more efficient.

And while Steinbeck writes of how this new era broke the old tenant farmers' quasi-mystical "connection to the land," the simple fact is that such a transition was inevitable. Nature abhors a vacuum, and economics abhors an efficiency. The tenant farmers were doomed the instant modern mechanized agriculture developed. The dust bowl migration merely finished off the dying beast. And, despite the individual tragedies suffered by the Joad family, the result left the country and the world better off.

I can't help but be struck by the potential parallels between the dust bowl and the dot-com drought that is now upon us. Yes, it's terribly sad that thousands of people are losing their jobs, but business doesn't have an obligation to provide jobs. It has an obligation to remove economic efficiencies and create value. Today's latter-day Joads would do well to focus less on bellyaching and more on making themselves valuable.

Wednesday, February 21, 2001

The New York Times ran an article today about dot-com layoffs. Like most stories of its ilk, it decried the heartless and clueless actions of inexperienced dot-com managers.

What it neglects to mention, like most stories of its ilk, is that the laid-off employees should have been fired months earlier.

It's no secret that every organization has its deadwood. What's remarkable is how reluctant people are to fire. I should know. Firing people was the hardest thing that I had ever done...and now that I've done it, I wish I had done so months earlier.

If an employee isn't a true star, he or she is probably a drag on productivity. That holds doubly true for dot-coms, which provided lucrative employment to an otherwise useless generation of liberal arts majors.

Let me put it this way: my company has eight people. It used to have 37, and we're getting twice as much done now as we did back when we were a big company.

Deep in your heart, you know it's true. Every time that you check out ESPN.com, or a porn site, or work on your personal email. Let's face it, even when you're reading this weblog.

So the next time you read a story about layoffs, don't think, "Too bad," think, "It's about time."

Tuesday, February 20, 2001

It wasn't supposed to be like this.

Let me make this very clear: I did it for the money. That's why I started a company. Though the search for funding forced me to wax eloquent about my entrepreneurial vision to revolutionize human existence, all I wanted to do was to find a way to throw together a company and sell it to a greater fool, preferably for cash.

It's been almost two years now, and alas, any dreams of getting rich quick are gone. All that's left are the memories of the millions my company spent (all of which I wish I had back), and the kernel of a business that just might work. And that's enough.

After all, isn't that what entrepreneurship should be about? At least, that's what I said in my B-school interview to get in.