When I worked at a USA defense contractor, a legal requirement was that in much of the organization, revenue and costs had to be matched up at a rather fine-grained level—every hour that an engineer worked needed to be matched to a particular revenue stream, likewise every product ordered etc. So if Person X was in charge of a government-funded Project Y to create Widget Z, they would know how much revenue they had and would watch it being spent down via weekly reports delivered to each project manager (and often those were divided further into subprojects with similar tracking). So if there was a big meeting, Person X might well look at the attendees and mentally tally up their various salaries and say “This meeting is costing the project (insert startlingly large number) dollars per minute, so let’s keep it quick, and people can leave early if their part of the agenda is done.” People talked like that all the time. Likewise, if Person X saw that somebody was charging lots of hours to the project and not getting a corresponding amount done, that issue would be noticed by Person X and they would make sure it got resolved, even by revoking permission to charge the project. This kind of thing was really on everyone’s minds.
You could say that the projects were kinda like a bunch of independent tiny firms, and middle managers were like mini-CEOs who could thus be held accountable.
This wasn’t true everywhere in the firm. The firm charged overhead (a fixed percentage “tax”) on all revenue, to spend on janitors and infrastructure and security and upper management salary etc. Those categories thus didn’t have the revenues-matched-to-costs discipline going on. People often complained that the overhead was too high and that this “tax” revenue was not being well spent in various ways. I was too low-level to have any visibility into whether those complaints were justified; it might have just been normal office griping, and not appreciating that APT-proof computer security is a giant money-sucking black hole, etc.
(The particular defense contractor I worked at had ≈2000 employees, but the matching-revenues-to-costs legal requirement applies to every defense contractor including much much larger ones. I don’t know how it plays out in other places.)
Incidentally, I have a family connection to this firm—see this book for the philosophy behind it—which (as I understand it) basically tries to do something vaguely like that for any company in any industry. (COI note—I’m not involved in that firm but do have a financial interest in it.) They’ll take a company’s books, and just match revenues and costs at a fine-grained level. If a couch is taking up 4m² of the 4000m² floor space at the warehouse, then that couch is matched up with 0.1% of the real estate and other costs of that warehouse, and likewise the couch is matched to the costs of however many minutes of salesperson salary were spent selling it, and however many minutes of truck-driver salary and dollars of gasoline were spent shipping it, etc. Then this database will spit out whether selling the couch was net profitable or not, and why. And then the firm sells a bunch of products and services based on using this database to make the company better, or something like that. The biggest surprise to me was that every company was not already doing this—isn’t it the obvious thing to do? WTF do they teach in business school? But I guess not. ¯\_(ツ)_/¯ Anyway, either the above book or its follow-up (I forget which, or maybe both) had extensive discussion of how to make good use of middle-managers in the context of this kind of system. But I don’t remember the details, sorry.
The biggest surprise to me was that every company was not already doing this—isn’t it the obvious thing to do? WTF do they teach in business school?
I wonder how this system would perform if charged with all the overhead costs for implementing such fine-grained tracking? Seems pretty tricky to answer I guess. It requires the counterfactual of not using the system at all.
From the outside, it looks like Tesla and SpaceX are doing an unusually good (though likely not perfect) job of resisting mazedom and staying in touch with physical reality. Things like having a rule where any employee can talk to Musk directly, and blocking that is a fireable offence, promoting self-management rather than layers of middle management, over-the-top work ethic as a norm to keep out people who don't actually want to build things, and checking for people who have solved hard technical problems in the hiring process.
I'd be interested to hear from any employees of those organizations how it is on the ground.
Perhaps a problem lies in your framing of "Get paid"? Immoral mazes stresses the fact that in these mazes there is a tremendous amount of rent-seeking. Its not so much that people value your behavior enough to pay you, but that you and others have made it so that if anyone else offers those paying you a better product, that person will be fined to oblivion, put in jail, fired, or have some other nasty event happen to them (when you find yourself in a maze that is. Mazes aren't everything, so you do see people offering better products than each other). The net result of actions ends up being negative even though (or because) you are maximizing monetary profit.
Oh, rather agreed. My point is that the vast majority of humans are just fine with rent-seeking, and in fact are complicit in wanting those rents. And we generally prefer to hide this under the guise of providing value and being rewarded justly.
My question is a search for counterexamples. Do we know of any large-scale endeavors where this kind of protectionism of valueless activity and rent-seeking is absent (or at least minimal)?
I'm trying to distinguish between two possible realities:
a) If a project requires cooperation of thousands of people who are NOT mostly in the top decile or so of capability and alignment, a hierarchical structure is necessary, and will always have prominent maze-like qualities.
b) Mazes are a current equilibrium, and near-universal because of reinforcement and expectations, but there are better ways, and it may only take one or two successes to seed this better way in the collective behavior set.
b - alternate framing) Mazes are fairly common, but not necessarily guaranteed, and it's feasible to build an organization of significant size without much maziness if the core is careful about it.
Raemon's recent post reminded me that I'm unsure how best to think about bureaucracies and apparent organizational friction, and that I keep meaning to explore why something about my intuition rebels against the "Maze" framing. I've read a bit of economic and public choice theory, and worked in for-profit organizations very large, large and small, and been exposed to (via friends' work) nonprofits medium and small. I kind of think it's a working equilibrium, that's likely to reoccur or become worse if we disrupt it.
Most people are ... not particularly great at coordination or even surface-level alignment. And not all that motivated to spend more energy than needed on abstract concepts like mission or utility. Hierarchical mechanisms for coordination are lossy and annoying, but the best we know how to do, once we're doing things that take an order of magnitude bigger than Dunbar's number, and require imperfect people (all of us) to spend much of our time and energy doing things we don't particularly enjoy, but that improve someone else's life enough for us to get paid. "Get paid", of course, is shorthand for "hard-to-fake signal that someone values our behaviors more than they value that money".
Certainly there's a large variance in just how "mazey" an organization is, even within a size and mission-category group (say, comparing local governments of similar-sized populations, or tech companies of a given size range). But I don't know of any over a few thousand that aren't mazes to some noticeable extent. Do you?