How to screw up a company (Part II)
Consider the following scenario:
You are a software engineer working for a software company that is funded by venture capital. The venture capitalist gives a talk stating that you should never invest more than, say, 40 million dollars in a company. The company in question has already received, say, 38 million dollars in venture capitol.
Next, the CEO holds a company-wide meeting telling the engineering staff how great sales are this quarter, thanking everybody for their hard work. In fact, it’s the best month for sales ever. Great, you think. Maybe I’ll get a raise. Well, OK, maybe I’ll get a new workstation. Either way, things are looking up for the company.
A few days later, you talk with some of the people who perform order fulfillment, that is, to make sure that a customer gets everything that they have paid for. The order fullfillment people tell you that sales are not very impressive. They might be able to give you a total number of sales, and knowing what product price is, the exact amount of money that the company is taking in. With a little more digging, you can estimate the costs of the company - the company is loosing money.
You put two and two together. The company is loosing money, and there is little chance of getting additional venture capitol to keep going. This is a skinking ship and you start looking for a job. Pretty soon, the entire engineering team is looking for a job as well. The company no longer needs to worry about engineering salaries, however, they no longer have any engineers. This is bad. There is also distrust between management and the engineering team because the presented business picture does not match the real-life image.
This frequently occurs because high-level managers who don’t understand how to program assume that the converse must be true - that programmers must not understand any level of management of financial analysis. Nothing could be further from the truth. Software engineers specialize in information management and analysis of one form or another - collecting bits of data and piecing it together isn’t all that hard. The “peek-a-boo” model of the universe works up until children are 3 years old - not 3 years into working at the company.
A better approach is to explain - with numbers - what situation the company is in. If the company is in fact in dire straits, it is likely that many engineers will start looking for a new job; they want job security as much as the next person. However, some others will likely stick around. This matches the mentality of people who run start-ups. There is risk, but also reward. Being caught in a lie is even worse. Management suddenly goes from being trusted to untrusted. If you don’t like when your kids lie to you, what makes you think that you’d like it if your boss lied to you instead?
Being in a bad financial position will get engineers to look for safe landings. Lying to engineers is going to get them to quit with prejudice. Likewise, assuming that engineers won’t catch on results in management looking both incompetant and untrustworthy. In short, assuming that keeping information from engineers is just another way to screw up a company.