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Maybe? But that case study has already happened time and again, yet these sorts of folks are allowed to slowly creep into working systems and break them still.

I think it's just the classic aging business problems, most people are averagely competent, many companies fail, a company that happens to have an over abundance of particularly skilled people will succeed, but over time the average skill of those people will decrease and the company will flounder.

There are ways to keep standards moderately high, and there are ways to tank it by allowing nepotism, encouraging CYOAism & turf wars, cutting salaries on highly skilled individuals relative to market rates (or laying them off to replace them with college grads)... I think companies (in line with the larger market) are just naturally cyclic and that incredibly long lived companies are quite the exception to the standard life cycle.

I understand GP to be talking about something different - about consequences of putting behind the wheel people who don't care whether the company is making planes or toilet paper, but view it as a vehicle to turn money into more money.

Goodhart's law states that "when a measure becomes a target, it ceases to be a good measure" - because people then start optimizing for the value of the measure, instead of what it's a proxy for. It seems that we've created a class of specialists, whose entire job is to do such optimizations. And we let them run companies, leading to predictable results.

Oh I agree, but I think that that factor has been obvious and evident in the US economy since the 80's. Management people work to maximize their take home, their take home is highly bonus dependent, their bonus is highly dependent on quarterly performance (not long term investment or good foundational decisions)... thus our stock driven economy is maximizing for people who can sell two dollars tomorrow for a dollar today.

I thought the other point (about the luck of selecting high skill employees early in a company lifetime) was also pretty interesting though.

> I thought the other point (about the luck of selecting high skill employees early in a company lifetime) was also pretty interesting though.

It was. I never thought about regression to the mean in context of employees of a company before. So thanks for bringing that up.

I remember reading an article back in June about how the Boeing/McDonnell Douglas merger was a watershed moment in the history of both companies going from a strong engineering focus to a business focus. Sadly, many companies have suffered a similar fate (I'm looking at you, Valve).

Valve never had an engineering focus. It was always product/design.

And they still have that focus. People just can’t handle that they’ve shifted from content (Half Life) to platforms (Steam, Vive).

But that transition happened a LONG time ago. Even Team Fortress, Portal, and DOTA are less of Valve properties and more of Indie mods that Valve has nurtured into tentpole properties.

They’re in their third act, from Game Producer, to Mod Publisher/App Store to Next Gen Hardware Platform Company. Don’t expect them to backslide from there.

Nothing of your characterization rings true to me. But maybe I’m missing something.

To me, Valve seems more like a company that zoomed out to look at the bigger picture, and in doing so abandoned what they were.

I don't think that they forgot about the technology side of things - but I do think that in leaving behind so much of what inspired them to expand in the first place, they may have drowned their muse.

At very least, I think they have compromised their ability to dog-food what they're working on.

Sure, I'd agree with that. Obviously companies in different verticals are going to have different benchmarks for what constitutes innovation. But designing "platforms" (to my mind), while certainly a product design undertaking, falls towards the MBA-end of the business maintenance vs. innovation spectrum.

There's a significant amount of deeply technical requirements in the back-ends of real-time platforms (which Valve is going to need to stop Google from stealing their pie) - especially if Google's super-real-time predictive magic is a believable seemless experience.

That will require a great deal of innovation - just not the sort of end user facing magic that the Valve of old produced.

Unfortunately I fully expect the external visage of the new Valve to be a smooth and greasy risk-adverse PR experience - but hopefully they can provide a platform that someone else can use to produce Half-Life caliber games in the future.

I guess I'm not sure exactly which product you're mainly referring to. The steambox/link product appears to have been a flop. If you're referring to some type of on-demand gaming product that they're developing I'm unaware of that, but in general I'm very bearish on cloud gaming. It very much feels like a solution looking for a problem. Most people interested in console/pc-style games will have a hardware budget anyway, and the whole idea seems like a revenue/subscription money grab. Who knows, maybe I'm wrong and that's the way gaming is going in the future, but I know for a fact that latency issues are a big stumbling block and it just doesn't seem like a reasonable use of bandwidth compared to, say, streaming video. That Google "pre-emptive" rendering thing sounded like pure marketing double-speak to me.

I'm not saying they have it, I'm guessing they'll need to. There's already some pretty complicated networking code in steam as it is - if steam adds cloud gaming to the mix, the infrastructure complexity is going to jump significantly.

If cloud gaming becomes something more than a dream, Valve is going to suffer hugely if the don't have a viable competitive offering.

Anyway, ignore me - I'm not sleeping too well today but now, and my brain's a bit melty.

Regarding the preemptive rendering, I think it is potentially viable.

What I'm thinking is branch prediction without the ability to roll back. You'll need to be able to minimise user noticable mistakes, as well as making any corrections minimally distracting.

I'm imagining auto-aim on steroids.

I think this is exactly right. They are always looking to the next thing, which leaves a false impression of “not doing anything” because they’re visibly not continuing to do the same thing.

That's a very narrow interpretation of what I said, but ok, I'll bite.

They've followed a similar trajectory. Starting out as a product-focused company in their industry (games), with innovative titles and game engine tech. Then moving on to focuses that have more to do with bottom-line finance than creative effort at pushing forward the industry with Steam. Delivering files [games] via an online internet store was anything but a revolutionary idea. Then moving in an admittedly interesting direction toward platform development with their VR products (Steambox notwithstanding). And I have to give them credit there for investing in real hardware development, but let's be honest, that happened at a time when VR was very buzzwordy and worthy of the corporate boardroom setting. They still haven't invented a piece of platform-changing innovation in the hardware/killer-app space, they're trundling along like everyone else who started a VR company in 2013, albeit with a bunch of previous revenue streams enabling large investment.

> they're trundling along like everyone else who started a VR company in 2013

By what metric? They’re #1 or #2 in that space. Leap Motion, Razer, etc are not in the same position. I really don’t understand what you’re alluding to.

> Then moving on to focuses that have more to do with bottom-line finance than creative effort at pushing forward the industry

Can you give me an example of a decision they made that you think made them money at the cost of holding the industry back?

Would you at least agree they were at the forefront of digital distribution and that was motivated by wanting to move the industry forward?

What about SteamBox and SteamOS, which came in response to Microsoft announcing they were going to require all apps to be distributed through their store? Was that a money grab in your estimation?

There’s already an excellent case study of exactly this: Sony. Forbes has a good article about it: https://www.forbes.com/sites/adamhartung/2012/04/20/sayonara...

Sony is actually a leader in the professional camera industry.

The other thing that happened was the separation between the defence and civilian parts of the business was removed. The defence part of the organisation was used to a lower standard of rigor and was used to delivering products which weren't up to quality standards because of the close relationship that the vendor and customer has in the military and the long timelines and large budgets for maintenance, etc.

Though, Boeing seems to be having a hell of time getting the US Air Force to accept delivery of the new air tankers because of sloppy manufacturing.

>Boeing is going to be the case study of what happens when you let 'business people' take over an engineering company. A bunch of MBAs deciding to move numbers around on paper and losing sight of the bigger picture.

>The 737 MAX and all the issues with the 787 isn't what happens when engineers are in charge

engineers are culpable in the 737 max too - i'm pretty sure many engineers and test pilots, like that Forkner who was saying one thing to FAA while the other to his colleagues, knew about that ugly situation and the risks entailed, yet didn't blow the whistle even anonymously. Those aspects remind the VW dieselgate.

> They had a goose laying golden eggs and they killed it to save the money on feeding it this quarter.

When are MBAs going to finally start admitting that returning every last penny they possibly can, and more, to shareholders just isn't sustainable?

You have to treat employees and customers well. You have to make a quality product. I think (hope) that most people are starting to wake up and will give more push back on business; demand salary increases, better work environments, be able to take care of the customer, etc.