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PaperclipPerfector  10mo ago (text post)   4080 thread views

Small-Scale Question Sunday for January 7, 2024

Do you have a dumb question that you're kind of embarrassed to ask in the main thread? Is there something you're just not sure about?

This is your opportunity to ask questions. No question too simple or too silly.

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Oh, this reminds me of a dumb take I saw on the system adminstrator subreddit, where several people argued (and everyone else agreed) that, as a system admin, they were worth whatever the lost revenue would be if they didn't do their jobs, which, as they pointed out, was basically all of it. Thinking about this for two seconds should reveal why this makes no sense.

There are lots of employees doing work upon which the same revenue depends. They obviously can't all be paid out of that same revenue. The value added by each step in a process cannot be equal to the total value created by the entire process, even though stopping any given step would destroy all value.

To expand on your example, the software engineer that saves the company $2,000,000 cannot do that without the system on which they're working being built in the first place. Someone had to make that investment, and they did so with the expectation that there would be optimizations that could be paid for with $200,000. If the resulting profits weren't expected, they would have invested in something else.

If it was so easy to generate millions in profit, why don't they A) Start their own business or B) successfully negotiate a higher salary?

You could argue that their employers have monopolies.

There's also another perspective to consider. Most software engineers may be costing FAANG money, not generating profit for FAANG. They simply pay those software engineers a high enough salary that they are happy to work at those companies and don't leave to create competing products or go work for their competitors. That's why it was so easy for these companies to let go of people when profits went down because they weren't that valuable to the company.

Something would have to have changed such that the risk of their starting competitors had gone down.

And some people claimed to work only 10 hours a week while being paid mid-high 6 figure salaries, and even more people that were working 2 remote software engineering jobs at the same time.

It's anecdotal, but I do remember reading a comment somewhere that, at the height of the the lockdowns, expectations had gone out the window and the culture had become one of just making sure everyone's mental health was good. No one was put under any pressure at all to get anything done. It's hard to believe that was common though.

In economics the problem of how to value various actors in a cooperative game is solved by the Shapley Value. In order to calculate it, one needs the profit the company generated if it employed a only certain subset of employees, for every subset. So if it employs 1 sysadmin, 1 rockstar programmer, 2 average programmers, and 2 secretaries, one needs to consider 2^(1+1+2+2)=64 possibilities.

What if it's zero for everything but the set of all employees?

Clearly the profits, if one doesn't take into account risk or replacibility, should be divided equally. It is a simplified model.

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