What happens instead is companies keep rewarding executives by increases in revenue, they keep rewarding product managers similarly, and product managers selectively choose metrics that optimize immediate revenue, at the expense of brand loyalty. This is happening to almost every tech company, and the exceptions are rare gems.
In android, if I click on a link in facebook messenger that takes me to facebook, the back button takes me "back" to facebook's home screen instead of to the messenger app. Tapping back button again does nothing. I have to switch back to messenger manually. That's 5-6 taps/swipes instead of 1, because a product manager's bonus in FB depends on how well they beg for more engagement. As a result, I rarely use any of these products. I used to spend some time in Instagram/FB. I close LinkedIn immediately after an important interaction for similar reasons.
I made a mistake of buying another Samsung product after years. Never again. I made a mistake of buying another HP product, never again. I might still consider Dell only because of how well they supported me with their monitor flicker.
None of these products have a defect that's caused by poor design, programming, or manufacturing. They all suffer from growth-obsessed mindset.
Brother is what it is, not because of lack of innovation, but because of deliberate evasion of short-sighted greed.
The shareholders can then invest into new companies and startups.
This is much better for the economy AND for the shareholders
Imagine a human being with a growth mindset. He optimises his bodyfat to the point of anorexia. He optimises conversations by extracting knowledge then moving on. His diet is pure protein shakes and broccoli. Every morning he does six Leetcode Hards. If you met him you'd think he was deranged.
This growth ideology means every company we interact with behaves like Bob. Soon enough this Bobism filters into people through the labour market and professional values. (Like the Leetcoders). It's alienating and the only purpose it serves is an investment based economy with unclear benefits to society at large
It creates a very strange world where we have computers acting like people and people acting like machines
My mental model is that money in the pocket of companies is "low entropy money" and money returned to shareholders is "high entropy money".
It's the same amount, but much less effective.
Once you hit that ceiling, the only reasonable thing is to focus on churn, not growth (as it will have the most impact). But that is like explaining that a "circular line on a map is actually a straight line" they say they get it, but they still see a circular line.
The money in the pockets of shareholders is more effective at finding good investment opportunities than the innovation department of big ol’ corporate.
But yes, there is an argument to be made, that acquiring small companies can be a valid strategy for big companies. Overall, I think this is bad for the economy though, therefore I am glad that antitrust is pushing back on this.
The alternative to stock buybacks is that the corporation make stupid acquisitions and try to integrate them into their processes, thereby killing them.
More to the point, if you think about it the biggest follower of the growth mindset is cancer.
And turns out that’s not just of
> unclear benefits to society at large
But actively detrimental to it, and ultimately, with a handful of exceptions, to the cancer itself.
This! Each and every time I see an Instagram link I avoid clicking on it for the same click/login capture nonsense. If they opened it up for views only with out logging in, I'd probably actually end up using the service. Short-term protectionist strategies like these will be etched into the gravestone of Meta/Facebook.
But besides that, is there anything that makes buybacks worse than dividends?
Stock buybacks only benefit shareholders and companies, not the economie. Trickle down and all that doesn't work, stock buybacks reduce a companies tax burden, especially when leveraged which they often are, do not lead to more investment. And they make the rich even richer.
See, for example, here:
https://hbr.org/2020/01/why-stock-buybacks-are-dangerous-for...
And salaries rise, primarily, through labour organization and collective bargaining.
That’s what happens when the oil companies do buybacks instead of investing the money
Dividends are cleaner and affect the price in well understood ways: you set a date for the elegibility, and if you bought before that you get the dividend, if you buy after you don't.
Stock buybacks are less transparent (you don't buy them all at once).
This way at least the money stay in country, instead of sending overseas checks.
Dividends also give money to people who have shares.
There is not difference beteeen these two mechanisms in who gets the money.
This was my life 2-3 years ago! Almost exactly. Definitely was deranged, no argument there. But I got in shape for the first time in my life (-90lbs), found a romantic partner, and got a ridiculously well paying job, all within a year. So, yeah, definitely worth it!
All the time, that's what dividends are. Not something that happens much in growth tech stocks but real common in the rest of the economy.
Kent Beck calls this the Explore and Extract phases (with the middle phase being Expand). I'm not sure if you had this talk in mind as you were writing your comment, but if not I think it'll resonate with you.
Which is to say, very little overhead
This is not to say low-creative types make a better company. I've worked with completely different sets and it makes for polar opposites. What I find interesting is that companies/groups tend to cluster leaning towards ones which push for innovation or either shun it, again determined by their core member personality makeup. I wish there was some more tendancy for them to balance out somewhat, but it is definatey a phenomenon.
As long as they aren’t acting in a way that excessively blocks/restricts competition, I don’t really see a problem with this. Old companies get boring, and eventually if they get too boring they get disrupted … maybe disrupted to death.
I would expect a growth mindset as applied to health and fitness would recognise short term versus long term benefits. Maintaining a healthy bodyweight decreases the risk of all cause mortality. Losing weight to the point of anorexia would cause numerous potential problems, and quickly be recognised as not ideal and a different approach applied.
Optimising conversations only for maximum knowledge extraction is not a valid approach within the broader goal of optimising social interactions to maintain a healthy group of friends and family who you enjoy spending time with and can depend upon for years to come.
A diet of pure protein shakes and broccoli is clearly not in line with any reasonable approach to a healthy diet which instead should aim to have a broad a varied source of nutrients, again with the goal of maintaining long term health and supporting whatever sports/training/activities the person takes part in.
A programmer/software engineer who is serious about improving their craft would be much better served by taking a holistic view of their role and expanding their knowledge and expertise to a much broader set of skills than just algorithms and data structures.
Your hypothetical deranged person I would argue is operating under the exact opposite of a growth mindset.
In fact every society which tried to take all of their money away and eliminate them as a class (more or less violently) has failed economically. Turns out when it works properly free market competition is strongest force for economic and technological progress that has ever existed.
The worst part is that when companies MUST switch must switch to "sustain" because they can't squeeze out any more growth or their efforts to squeeze out more growth become counter productive, they instead switch to enshitification and drain their user base, and the company, of all the value they can, essentially running into the ground for a few more quarters of profit and bonuses.
As an aside, I'm sad that "growth mindset" has been hijacked to mean "grow at all costs" when it originally meant "the belief that a person's capacities and talents can be improved over time". It was originally a term of nurturing, not of exploitation and infinite capitalism.
> And salaries rise, primarily, through labour organization and collective bargaining.
No. Supply and demand is and pretty much always was a much stronger force.
How would these "consumer groups" even work? Would they be democratically elected? Appointed by governments? How would they be insulated from pressure from companies trying to suppress competition? It would inevitably lead to a thoroughly inefficient and corrupt system...
At our company we're trying to do the same thing now, supporting logged out users is just too expensive and not worth it.
I'm all for it as a employee AND a shareholder.
But there seems to exist another phenomenon that is described in the book The Mindset, where the term originates, which is quite different.
Let's take some examples from partner dancing which I am very familiar with.
In some dance cultures, it is customary for the leader to try to maximize the area on the dance floor that is occupied (or "owned") by the couple. This is done, so you can dance more freely, do whatever you please. Such leaders may use many methods, such as intimidation and even physical force to push "weaker" leaders away from the area they consider their own.
There are other dance cultures, where the leaders try to co-operate. For them, the area on the dance floor is shared. I feel where the other leaders are going, in a way I dance with the other leaders as well. We will try to harmonize our movements so that we can all share the area. The leaders who are able to effectively use the space are highly valued in such cultures. Beginners are given a little bit more slack, of course, but at the same time, non-cooperating leaders may be pushed out by the co-operating leaders.
I once participated in an Argentine tango dance event (called a milonga) in Buenos Aires, which was for locals only. Many milongas are filled with tourists, so the locals try to keep the tourists out from certain events they consider their own.
I was invited to the event by a friend, a follower, who knows many locals and so is accepted member of that event. But even knowing my friend did not give me any slack, but my co-operation was put into a rough test from the beginning.
Many leaders intentionally surrounded me on the dance floor, and pressured me from all sides. As I am quite experienced in dancing in small spaces, I did not hesitate and was able to continue my dancing and keep co-operating with the other leaders although they were putting me into this test. After I had passed this test, I was accepted, and the testing stopped.
I have also been invited into events where one key requirement to even get allowed to apply is that the organisers know your dancing, and they especially need to know that you will co-operate. These are lovely events, because the level of co-operation is very high.
I think one key part of the real growth mindset is co-operation. You give up on fighting for some resource (in this case, the area you occupy on the dance floor), and you will gain something more valuable -- co-operation with the peers -- and through this co-operation you will have enough of the resource you need -- in this case you will always have enough space for your dancing.
Another part of the real growth mindset appears to be the attitude of anti-fragility. If I accept the challenge of trying to learn to dance without aggressively trying to occupy space -- even though I would be skilled enough to do it -- that pressure will eventually teach me to become an even better dancer. It is not easy, however, it may take years of persistent effort to overcome this hurdle. But without this pressure I would have never learned.
But if this strategy underperforms as badly as we as customers feel it does, it will eventually drive its perpetrators from the market. If they think that their positions are unassailable, let them remember how the unassailable GMC and Ford felt in 2000s.
It already has: https://en.wikipedia.org/wiki/Church_of_the_SubGenius
Any app that does something other than that is wrong and should not have been approved.
https://jacquesmattheij.com/if-growth-was-good-then-getting-...
This obsession with growth is so utterly self-centered. I still have those chairs, by the way.
> investment based economy with unclear benefits to society at large
"unclear benefits"? Unlimited growth is causing the environmental collapse.
Growth for growth's sake is simply wrong. It is always growth at the expense of something larger.
The three month stock market cycle coupled with capitalism and advertising are at the root of a ton of societal problems that we are incapable of solving within that framework. Between those three we are all just lemons to be squeezed.
Growth mindset is the _personal_ belief that _your own_ abilities are not fixed and can grow. It provides psychological benefit when faced with difficult problems and improves grit. It is not the classic HN over-optimized self. It says nothing about _requiring_ growth.
But for this conversation, the point is made well enough, I just hoped we could avoid a viral pushback against a perfectly reasonable thing.
At some point, obsessive focus on growth has to lead way to something more sustainable.
I like how you phrased that as the positive result of a (personal) growth mindset. For non-native English speakers, the word "grit" might be interesting to learn about. Aside from the other common meaning of "coarse grains as of sand or stone"..
> In psychology, grit is a positive, non-cognitive trait based on a person's perseverance of effort combined with their passion for a particular long-term goal or end state (a powerful motivation to achieve an objective).
> This perseverance of effort helps people overcome obstacles or challenges to accomplishment and drives people to achieve.
> Distinct but commonly associated concepts within the field of psychology include "perseverance", "hardiness", "resilience", "ambition", "need for achievement", and "conscientiousness".
It reminds me of a similar term, "gumption".
> gumption - Boldness of enterprise; initiative or aggressiveness.
I'm lambasting the "growth strategy" that leads companies to release worse products via over-optimisation. I am pointing out how this sort of 'growth strategy' would lead to absurd behaviours if a human applied the same logic.
Google kind of did this for a time with Inbox and similar products. Apple had multiple phone lines (less like this, but a tad). Facebook has multiple social media platforms. Block has square and cash app (among other things).
Logged in users receive more errors.
Thanks, caching, for allowing me to continue procrastinating.
Stock buybacks have destroyed companies like GE and Boeing.
This is very well covered in the book about Boeing - Flying Blind. A bunch of Jack Welch mentees did the same trick, selling the company for parts and buying back the stock - until there was nothing left to sell. It was very "profitable" for a while, though!
It's not a tool for company growth - it's an accounting trick to make the wealthy ultra-wealthy.
There is a reason why buybacks at these levels were illegal (or at least very hard) until the early 80s, but there were multiple pro-big-business "reforms" that took root under Reagan which are now wrecking sensible Capitalism.
I think it would be reasonable to class his mode of being as that of individual growth mindset.
The American growth at all costs mindset (particularly quarterly) is excellent during the technology exploration phase. It spurs radical innovation, but as a technology matures it becomes impossible to meet growth expectations. In response to this the spiral of Enshittification kicks off and eventually the company and it's products fade into irrelevance. Stability in such an environment is impossible (the gain knob is cranked to the max).
The German Mittelstand are different, typically they are much slower to innovate during the technology exploration phase (I think mostly due to the German economy not really rewarding early stage innovation). However as a technology matures the Mittelstand's strength in stable, gradual evolution and refinement really shines. They focus on being the best in their niche and grow by expanding to new markets, opening adjacent product lines etc. Enshittification is the last thing on their minds (the system is critically/over damped).
Ooh nice, TIL and thanks! I really liked "Lights Out: Pride, Delusion, and the Fall of General Electric" about the failure of GE and was looking for something similar.
On the topic of buybacks and dividends, it's part of the short term quarter-oriented thinking. Spinning off subdivisions and doing stock buybacks and dividends are very popular and look good on the balance sheet in the short term... but if you think about a quarter or two ahead, it's crippling. But it doesn't matter, stock go up, bonus go up, everyone happy for now, kicking the can down the road until it's someone else's problem.
But it's absolutely crucial to VC funded businesses. Current VC groupthink isn't "how can we create businesses that deliver value", it's "how can we create businesses that we can convince other investors to see as valuable before we cash out and move on?"
That's why we have things like "increasing headcount" as a goal, because increasing the number of people a business employs increases its perceived value. It doesn't matter if it destroys team dynamics, increases the burn rate, etc. It's a tool used to make a company seem more valuable before the VCs exit.
What you are referring to is simply Capitalism.
Capitalism is where 'capital', aka money, ultimately, owns the 'means of production'. And it also innovates, and creates the means of production, by deploying money to uncertain ventures; building a new factory or whatever.
The problem is that deployed capital needs to earn a return, else why bother. In other words, everything needs to grow. The system just doesn't work without growth.
'Growth' can be, people doing more things, or, more people doing things, or, making more money from the things people do (though I'm not sure that's actual growth). We've come a long way in the last century with the first two, and now the focus seems to be on that third option.
IMHO the current system is past, or at least fast approaching, it's expiry date, and we really should have researched, and have at least a vague idea of a plausible future replacement, by now, otherwise we might be doomed to recycle the 20th C.
While I'm not advocating for the growth mindset, you seem to be neglecting why, exactly, most executive incentive packages so frequently include stock options. They are directly intended to defer the rewards over a defined vestment period to align their incentives for the long term success of the company.
You can have ordinary well functioning products that just do their one thing and do them well, and thus grow market share.
There is nothing about 'growth' that says your product must add and add features until it is un-usable, which it seems like people are saying is 'growth' as in 'personal growth'.
Just build good products and 'grow' market share.
Printers have failed this by making their products bad by growing features, and thus Brother is winning because it can simply print. A printer that can just print, and not wash your car.
That sounds more like a sustained model with unhealthy targets.
I'd think a growth model would be more like uncontrolled addiction, where the goal dosage continually increases and stays out of reach.
Growth is good, but it will eventually cap out. It's what people do when that happens that really matters.
That companies should always operate as worker cooperatives and never return money to shareholders?
Because stock buybacks are just another type of dividends.
To be clear, I think that we need to address both of these issues: general wealth distribution and lack of affordable housing.
I've worked in several support organization that sincerely prioritized providing good support to customers. They paid good tech's good salaries, hired good managers, and we provided great support. Sales team members would come to me and say they were selling support contracts with ease because of the support provided, "easiest money I ever made" was a common refrain.
But eventually at every company customer / tech support eventually is viewed as a cost, an annoyance. After all when customers complain what do they complain about? Even the best customer's can't praise support enough for companies to avoid eventually seeing it as an annoyance and eventually cost that is easily cut. Good managers see it coming and jump ship, support for support teams starts to erode and the culture changes.
I worked one company where the engineering team would secretly invite some of the support staff over to their building when they had a team lunch ... because they liked us and knew that our team lunches (low cost pizza) had been cancelled.
It happens time and again ... :(
Eventually I moved on and learned to code. Maintenance is hard and not valued.
This is OK if management is paid and get bonuses by the money they make by selling products. If they make money and get bonuses by selling their shares or increasing their value, they cross the line between industry and finance. Finance doesn't give a f** about industry. They'll eat one after another like we eat cherries. Unsustainable growth and enshittyfication are two tools to squeeze the most money from a company and if it dies in the process they move to the next one.
Somewhat pedantic comment: the phrase "growth mindset" is also psychology jargon that refers to the fact that many skills are more learnable than most people realize. It contrasts with a "fixed mindset" where people assume you have to work with what you've got.
Just wanted to point that out so people don't get confused between the healthy idea of being able to grow and the idea you're addressing, which is more like a compulsion for businesses to grow economically.
I believe the parent commenter's point was exactly this. Giving money to the investor class and expecting it to benefit everyone is the definition of trickle-down economics.
Analogy is a literary device for conveying an idea. You obviously understood the idea being conveyed, thus, the analogy did exactly what it was meant to do.
"How can we steal a man's shirt while convincing him he only lost it[1] instead?"
If there's only so many shirts to go around, and they have to come from someone else, maybe we just load a bag full of rocks, lie and tell people it's full of their laundry, and then leave the laundromat before they notice. When they do notice, they will blame themselves. "Why oh why," they lament, "did I not immediately recognize it was a bag of rocks all along!"
However, investors aren’t interest in buying stock in a company with poor returns. They have other options with better returns. It comes with accessing capital in the public markets.
The other issue is that a sustainable business quickly becomes a dying business when competitors innovate and you don’t.
I honestly can’t think of any business that just prints cash without a daily struggle to keep the company growing.
Like I said, it's the tax treatment that basically stopped growth companies giving dividends. I think that we should change said tax treatment and also make buybacks illegal but that's a bit more controversial.
In any case, for both G and FB, they'd need to do buybacks anyway because of their employee share programs.
And I don’t know about you, but I’m kind of glad the healthcare industry has a growth mindset that “what we have is good enough”.
It’s how humans advance. If cavemen thought “well this is good enough” well, we’d still be living in caves.
However starting 200-300 years ago the industrial revolution and various innovations have made other growth possible. Today war destroys far more than it gains you need a large industrial base to build a lot of equipment that you destroy (bombs are not cheap), plus all the equipment the enemy destroys. If you don't go to war you can instead use your industry to build more luxury goods (vacations are a valid luxury good for this discussion though we don't normally think of them that way!)
Note, war above is entirely from the attackers point of view, and it is - as attackers are - optimistic about the chances of winning a war. The defender has other considerations.
If you've studied artificial life and see societies as mechanisms for executing the genetic algorithm, you see the faults with the growth ideology you've criticized. It's a plateau-making machine: it will tend to reward what's working right now, and starve out the genetic pool of anything else, leaving the resultant society unable to adapt.
Computers acting like people and people acting like machines is a bad trade-off. It's not at all focussing on the strengths of each. There's a reason societies (such as big cities) that seemingly focus over-much on caring for useless and suboptimal people (compared to the darwinism of the wild frontier), end up burgeoning and becoming hotbeds of accomplishment. If you treat people not as machines, but as the genes of the genetic algorithm, it suddenly makes a lot more sense to be humanist: you'll get unexpected wins out of unexpected traits being cultivated until they can be useful in their own right.
indeed there's a notion of quality in innovation and development, and also market rhythm fit..
as a kid, waiting 3-5 years to see the next version of photoshop or office was long but good, when the web came, you could get a near direct line with the devs.. instant download, constant updates.. and it quickly felt like a disease, this growth is just instability under disguise
Exactly. We have two new Brother multifunction printers at work and they're pretty great. They're exactly like printers, you tell your computer to print a document, that's where it comes out. No hassle.
All this other BS that HP, Epson etc. are pulling isn't innovation, it's extortion. "Just be a printer that isn't shit" is innovation in this environment.
Where did I say that?
> And I don’t know about you, but I’m kind of glad the healthcare industry has a growth mindset that “what we have is good enough”.
No, you really don't know about me. But there is plenty of innovation in healthcare, and not all of it is super costly (though some of it is). Like every other industry it is a confusing mixture of regulatory capture, people that really care, people that only care about their income stream or bottom line and people that wished they could do even better. The difference between say 'big pharma' and your average nurse of doctor is massive and to lump them all into one giant heap is not very productive.
> It’s how humans advance. If cavemen thought “well this is good enough” well, we’d still be living in caves.
The 'this is good enough' is a strawman. There are plenty of things that really are good enough, and which have turned into pathways that are borderline extortionist.
And there is plenty of innovation that is not cancerous.
But do deny the reality that short term stock market driven goals of eternal growth are incompatible with a sustainable and healthy society is a non-starter for me, it is so incredibly clear that to ignore it is almost wilful at this stage. "After me, the deluge".
Workers are the shareholders in worker cooperatives.
The problem with reality is it is not clean or simple. For example having chlorinated water keeps you from getting any number of terrible diseases when you get a drink. At the same time it's a deadly chemical that takes huge amounts of industrial processing to make, and if not treated right is a source of pollution.
Not any different then the 'forever chemicals' we've made. They were highly stable and did their jobs well. They also are terrible cancer causing bioaccumulators that have caused tons of misery.
Open ended problems do not have simple solutions. They have trade offs. It's a good idea to fully understand the trades you're making.
Ultimately we prioritize our logged-in customers.
The one overwhelmingly large difference is that the professionals that deal with it on the context of people are well trained and know not to push it over the point it becomes harmful. But that detracts nothing from the point.
This topic reminds me a lot of the recent thread on Signal being so comparatively small but being scaled so big (and shaming big tech companies for being so big). https://www.sfgate.com/tech/article/signal-meta-google-too-b... >>38382811
>You've mastered the highest paying technology, you've moved to the highest paying location, etc.
The point isn't that the particular strategy for health and fitness is right or wrong, it's that the growth mindset causes the person (Bob?) to over-focus on that aspect of their life to the detriment of more important but less obvious ones, like personal relationships, being kind to others, or enjoying fallen leaves in autumn.
Bob spends his 20s trying to improve his bodyfat percentage, max his bench, get a Porsche, and build his 401k.
He misses out on his niece's early childhood, loses his highschool friendships, and breaks up with his girlfriend for a job opportunity in a different city.
This is like the printer company focusing on revenue instead of brand loyalty or its reputation.
Most of the money returned to shareholders isn't going to be pumped back into the economy as money spent on goods and services. It just goes into the casino we call stock and bond markets where it provides some liquidity for some investment into companies, but most of it is just spinning around creating no value.
Of course people here are getting hung up on your analogy. It's no surprise. But what you've written here is a very real consequence of our growth economy because humans are merely inputs into hoarding monetary capital. All other capital, including people, with the exclusion pf land and some selective niceties are expendable towards that end.
It matters whether people’s work is effective or not, because it it’s ineffective, you have fewer goods and services that can be consumed.
The factor that connects work to output is called productivity.
It matters how the goods get distributed, yes. But as communism has shown, it also matters a whole lot how many goods and services are being produced.
Given a certain amount of money, spending it on stock buybacks vs spending it on dividends returns the same amount of money to each HOLDING shareholder.
In one case, they receive a small sum. In the other case, the value of their stock goes up.
Yet here we are - with the most prosperous and healthy nations all based on a model around, what you call, “short-term stock market driven goals”.
May you have give an example? Because I look around and don’t see what you see.
Yes! What I see instead is a shoot-yourself-in-the-foot mindset. Its everywhere I see. I wish there was a way to see and fix this before its too late.
The right way to treat your loyal customers is also micro-intangible, hard to show clear numbers and so does not bear any rewards for a manager taking this approach. Instead, the opposite of screwing loyal customers for new ones is rampant, easy to cook up numbers and so amply rewarded not just limited to tech companies.
Unless the same management chain is responsible for new customers and leaving ones, this is an internal conflict of interest and its effects only show at the macro level.
I've seen many once-popular restaurants go this route, losing long time repeat customers who prefer well priced, familiar drinks and dishes over hit or miss exotic overpriced ones. They don't complain, they just stop coming back.
Car manufacturers, Appliance manufacturers, Food chains, Internet Service Providers, Telcos, tech startups are all guilty of this. Factions at MS, Goog, AAPL too are guilty.
Exceptions here are really really rare. I've never bought a brother printer, but it will be my next.
Honest question: what's wrong with Samsung? I'm pretty happy with their phones and SSDs but haven't had any experience with their appliances.