Comment by devjab | Hacker News Reader

Comment by devjab | Hacker News Reader

Parent Full thread

I think it’s what is the natural consequence of handing over management to MBA types. They can’t create new things. I don’t mean that they should be programmers, engineers or whatever they’re working with. I mean that they can only exact value from something that already exists. Which is always going to be a short term strategy because the only way to do that is to make “the it” worse.

I’m not sure Facebook fits in considering they at least managed to get some other products along the way, and may get more.

I certainly don’t think Google fits the bill. Google is failing because they let their cash cow ruin everything else, not because they let it stagnate while they chased the next moonshot. Google Cloud could have easily been competitive with AWS and Azure in European Enterprise, but it’s not even considered an option because Google Advertising wouldn’t let it exist without data harvesting. Google had Office365 long before Microsoft took every organisation online. But Google failed to sell it because… well…

It’s very typical MBA though. Google has killed profitable products because those products weren’t growing enough. A silly metric really, but one which isn’t surprising when your CEO is a former McKinsey.

It couldn’t happen to a nicer company though, and at least it won’t kill people unlike Boeing.

I think you're conflating separate phenomena:

* Boeing is a consequence of the "Jack Welch" effect - gutting the core in service of short term gains for stock-holders.

* The MBA type, typified by John Sculley at Apple is about calcifying the current offerings presuming market segments supported by historicals with predictable demand. This works well for defensives such as utilities, consumer products and health care but not for markets with dynamic consumer relationships such as technology.

* The Google Cloud example is the Xerox Parc phenomena. Xerox was organizationally structured for investment payoffs only characteristically similar to their mainline products thus they couldn't properly allocate resources to things, such as desktop computing, with different kinds of curves. This is similar to how the franchise retailer Blockbuster so slowly responded to the centralized mail-order subscription Netflix. The institutional structure is only-so-flexible. This is similar to Conway's Law.

* The "ruin everything else" is a generalized form of a "brand extension failure". Examples include Harley Davidson perfume, Bic underwear, McDonalds Pizza, and Heinz cleaning vinegar - an over-leveraged commitment to a wildly successful core offering makes other ventures impossible.

This is not that. It's yet something else. Abstractly it's "X is a wild success, let's make Y another X instead of working on X+1"

Organizations suffer from varying degrees of ailments and they can create codependencies making the unraveling hard. Often it devolves into politics of power brokers with the company's survival dependent on the competency of the influential instead of the influence of the competent. A brutal struggle to control a sinking ship.

The crisis of the third century happens every day.

> I’m not sure Facebook fits in considering they at least managed to get some other products along the way

can you name these products?

Instagram, WhatsApp. Granted that these were acquisitions but they have nicely been integrated into their overall product suite.

And now their VR products.

I think consumers consider their glasses a solid product. They may have had the first successful version of the idea

They're "integrated" the way Adobe or Autodesk's acquisitions are "integrated," which is to say that they're not, in any meaningful way - but at least you only have to log in/get your credit card out once. And that's sort of fine, because they never needed to be integrated. All of the individual applications work fine on their own, with common media formats if you need to move between them. In fact, the acquisitions should have never taken place at all; they should have been blocked for antitrust violations.

Reply on news.ycombinator.com