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> Large business wastes just as much money as govt, but when a business makes a mistake they just stop talking about it.

It is refreshing to see someone else say this. John Ralston Saul wrote about it, completely changing my view of the supposed efficiency of big business - and explain why neoliberal shibboleths like privatisation don’t result in improved efficiency.

> Big projects are hard. They're expensive. With large budgets comes lots of oversight, endless second guessing, and a zillion rules, perfected over years, to ensure money is not wasted or stolen.

Not really perfected. According to the Standish Group only 1% of “very large” software projects succeed. This would be unacceptable to most reasonable people. But the processes they use enable so many excuses for failure that accountability goes out the window. Basically, all the money is spent on risk mitigation to the point that the project fails because all the money is spent before it actually starts.

There is a huge amount of crazy that goes on when there is a crazy amount of money to play with.

Another factor is that 'private enterprise' gets to decide which customers they want to have.

Meanwhile, government organizations cannot be 'run like a business' because they have to follow the laws that created them, which often preclude competition with the private sector.

>It is refreshing to see someone else say this. John Ralston Saul wrote about it

What did he write? Link please.

I read this pre internet but I think the book was called “the unconscious civilisation”. I really loved it at the time, but haven’t read it for 30ish years.

Here it is:

https://www.amazon.com/Unconscious-Civilization-John-Ralston...

"In this intellectual tour de force John Ralston Saul argues that our society is only superficially based on the individual and democracy, and the West now toils unconsciously in the grip of a stifling “corporatist” structure that serves the needs of business managers and technocrats as it promotes the segmentation of society into competing interest groups and ethnic blocks."

Published in 1999, so not quit pre-internet. But I still bought paper books back then!

A lot of people talk about the inefficiencies of government with lots of cushy career bureaucrats that are lazy. In truth, US government federal employees get substantially worse benefits and protections than private sector EU companies while much of the ire is directed at “lazy” public sector employees.

The kinds of experimentation and wild re-orgs constantly in private sector have substantial costs and so many of them are not so much product driven as they are investor fad driven it’s a ton of capital waste. Yet somehow market proponents see that as healthy and by design. Like uh, then by design public sector is supposed to be more stable and they have different kinds of capital inefficiencies systemically and we are spreading out risk as a society similar to a long term financial portfolio.

>Large business wastes just as much money as govt, but when a business makes a mistake they just stop talking about it. In govt it ends up on CSPAN.

The other difference is that the business has to compete with other businesses and turn a profit (or convince investors it will eventually turn a profit) to survive. In any given year they might get away with waste. If you’re a mega corp in an oligopolistic business, maybe even a decade or two. But eventually, you live or die by the bottom line. By contrast, a government keeps existing no matter how poorly it manages its finances. Look at Zimbabwe, Argentina, Venezuela, South Africa, Greece, etc.

No, businesses absolutely collude to get out of each others way, and it happens a lot more than you think. Even businesses that are "competitors" often have different aims and goals in the long run. And generally their are banks an wall street that are willing to pick up the tab for businesses that are big enough, even if they are failing. Look at a company like yahoo, or oracle, or IBM. How do they keep existing, when they are essentially zombies running on funding through the public market?

Oracle’s revenue last year was just under $50B. IBM’s was a little over $60B. Free cash flows were around $8.5B and $9.5B, respectively.

Those are not the financials of zombies running on money from the public market.

IBM is laughing stock to everyone. Whoever would want to work there, it’s not young ambitious people.

But it’s also a 100-year oligopoly, it will take more time to die.

It’s also a golf company - its main activity is channeling golf courses to government members and management teams. You wouldn’t classify ClearQuest or DrWatson are serious pieces of software. DrWatson can be reproduced with a small python script, that’s why it sells so well: You sell the idea of AI to the press since 1995 and it gives a good image.

The business of IBM is mainly funneling money from governments to government members; from corporations to higher managers. It makes corruption legal. This kind of businesses thrive well in general.

Oracle and IBM print money from the processes in the article.

Incompetence has to bridge the moat to matter. Private moats are not tiny and government moats are not infinite.

>But eventually, you live or die by the bottom line. By contrast, a government keeps existing no matter how poorly it manages its finances. Look at Zimbabwe, Argentina, Venezuela, South Africa, Greece, etc.

That's just survivorship bias. Some counterexamples:

https://en.wikipedia.org/wiki/Fall_of_the_Berlin_Wall

https://en.wikipedia.org/wiki/26th_of_July_Movement

https://en.wikipedia.org/wiki/1997_Albanian_civil_unrest

This is an interesting counterpoint, but I'm not sure it's a counterexample: those governments kept existing, in the sense that the, say, Cuban government existed both before and after; they just had radical changes of direction and leadership. The same can and does happen to companies, and I think many casual observers would say that the business has survived.

That is a fair point! As a full counterexample, East Germany stopped existing after the wall fell.

> That is a fair point! As a full counterexample, East Germany stopped existing after the wall fell.

Ah, good example.

> I once pitched an off-the-shelf program to a corporate, which would have cost 10k to roll out company wide. But the procurement process demanded a proper evaluation first, which eould cost about 5 times that.

Normally, the cost of COTS software is many times the sticker price. Deployment, ongoing training (of existing and new staff), adjusting policies, security monitoring, upgrades, etc., etc., all have costs.

Even if this was a "use once only and throw away" program, the cost of deployment (timetabling, writing and distributing instructions for use, etc.) and of ensuring deletion would be more than $10k in even a small organisation.

Proper evaluations take these costs into account. Bureaucracy is the worst form of management, except for all the others that have been tried.

> you need a small qualified team

That's the problem.

> I once pitched an off-the-shelf program to a corporate, which would have cost 10k to roll out company wide.

$10k, plus the effort to actually deploy, train, etc. And what happens if you need to roll back? What criteria are you checking against? So many questions.

> Better that than letting someone later claim that 10k was wasted.

Listen, I don't disagree with the idea of small, qualified teams being great. But I've also seen a good number of people who think they are qualified push things through that were really just bad ideas. This comes from smart people, too. Smart at what they do, but not at the specific thing they are trying to get done. It's just outside of their wheelhouse.

> Which brings us back to well resourced, small teams, of competent people.

Yep. Easier said than done.

> Large business wastes just as much money as govt, but when a business makes a mistake they just stop talking about it.

Perhaps also dictatorial governments: they would have the authority to sweep things under the rug and make sure no one talks about them.

That's one of the "problems" of more open societies: the dirty laundry is there for all to see. This makes it possible to bike shed on many (perhaps trivial) things.

> Reputation (and blame doging) is far more valuable than cash.

There's perverse incentive at work, too. When you get to manage a project, your status rises, even if you fuck it up. Because the next time they need someone, they will look for someone with experience. "Surely, (s)he has learned a lot since then." So it actually can be good for your career to waste money.

Process for accountability is what's required.

how do you go from raising $250 mil in may and layoff people in june?

https://techcrunch.com/2023/05/12/indian-edtech-giant-byjus-...

https://techcrunch.com/2023/06/19/byjus-layoff/

> Large business wastes just as much money as govt

Delineating them is a fools errand from the start.