The parent comment didn’t say anything about size or wall street. It said leadership is what has preserved it.
Which it doesn’t seem you have refuted in any meaningful way. You just restated what the parent comment is responding to with no further reasoning as to why leadership doesn’t account for it.
I honestly don't understand your comment, so let me try and recapitulate what I think you're saying and what I think I was saying, and then you can tell me where I missed the mark.
What I hear you saying is that the original comment simply said that leadership by itself is enough to preserve the Costco ethos. It didn't say anything about size or Wall Street or anything else. Is that right?
The reason I responded the way that I did is that the claim that something by itself is enough has to explain why most companies are able to be destroyed, even though they have really good leadership. I think the common answer when people ask about Costco is that the reason why, for them, leadership was enough when it hasn't been for other people, is something like they're so large. Does that make sense?
Either way, in order to say that leadership by itself is sufficient, we have to figure out why Costco has been able to endure as a gigantic public company when, for most companies, the larger they become, the more valuable they become as a target. Meaning that Wall Street or other financial forces will intervene to change their values.
And the answer, which I lay out in the book (not in my original comment), is that Costco is protected by a very distinctive thing I call a "governance fortress." This fortress (and not merely their leadership) is the reason why they have been able to endure for forty years.
In fact, the predecessor company of Costco, spiritually speaking, was a company called FedMart that had the leadership and ethos but did not have the fortress. I'll leave it to you to read to find out what happened to them.
> the claim that something by itself is enough has to explain why most companies are able to be destroyed, even though they have really good leadership
I think most of us are happy to believe that most companies simply have bad leadership, that leadership quality really is the axis on which Costco differs from others. If you want us to believe that other (destroyed) companies' leadership is just as good as Costco's, you need to make that case.
> Costco is protected by a very distinctive thing I call a "governance fortress." This fortress (and not merely their leadership) is the reason why they have been able to endure for forty years.
Can you sketch out your actual argument here (I think doing so would help rather than hinder your book sales, though of course that's a biased judgement)? What is this "governance fortress", and why should we believe that that, rather than the personal qualities of this one guy, is the reason they kept the hot dog?
Sure, happy to. This is a very common source of confusion, so definitely worth clarifying. We agree that Costco's difference is due to its superior leadership. The question is why has the company been able to maintain this leadership advantage over multiple generations of managers, when other companies have not.
In the book, I give dozens of examples of companies that were well-lead and then suddenly destroyed, often by outside actors who found a way to profit from their destruction. This often happened at the governance layer, while leadership watched helplessly from the sidelines.
So why hasn't this happened to Costco? I don't think it's a coincidence that Costco has a variety of "bad governance" provisions, such as a super-majority (of all shares, not just votes) provision threshold for shareholder votes, as just one example. When activists, analysts and other Wall Street actors have tried over the years to force Costco to change, its leadership has been insulated from this pressure. I think that is a structural factor that is important.
Again, structure does not _cause_ ethos. It protects it. My argument in the book is you need both.
> ... Costco has a variety of "bad governance" provisions, such as a super-majority (of all shares, not just votes) provision threshold for shareholder votes
Do you believe there's a fundamental tradeoff between structural constraints (i.e. the 'democratic' model, where dispersed shareholders and markets have a voice) vs. insulated leadership (i.e. the 'benevolent dictator' model, where competent leaders are shielded from short-term shareholder pressure)?
From my perspective, there is such a thing as "too much democracy." I don't know how to quantify the exact right amount for a given situation.
In the case of companies, a benevolent dictatorship is fine because employees, customers and investors can all exit and find other companies. It's at the nation state level where you need more structural veto points. (Arguably true for towns/counties/states too, but you still have the right to exit so...)
"I think most of us are happy to believe that most companies simply have bad leadership"
I don't believe this for a second.
I don't know if this makes me the minority or not though!
It trivializes forces influencing large public companies.
Yes - there can be good and bad leadership - and bad leadership is just bad.
But good leadership can be totally helpless in a public company.
Not recognizing this is a huge gap.
The other forces that incluence a company:
- Board
- Shareholders (via board)
- Banks. Lots of companies have loans. The banks generally have the companies by the balls and can dictate many things when things go south - either due to leaderhip or just prevailing market winds
As an example of shareholder/board direct and rapid influence: an activist purchases shares. Installs board member. Causes rapid change in one or more aspects of business structure or strategy to support _their_ portfolio strategy (of course aligned with interests of other shareholders).
I think you’re right, however, I think the person you’re replying to may also.
And is shorthanding “everyone without direct experience of the influential power of market forces” into “most of us.”
I think it’s fair to say that the fact that more or most people _don’t_ understand that and _do_ think it’s “all just leadership” explains much of the sentiment about capitalism generally.
And government in general. Populist demagogues capitalize on the misperception that one man can just make all the "easy" fixes. DOGE was a good example of that.
Thanks for responding, I do think you interpreted my comment correctly.
I see size as negatively correlated (maybe as a semi-direct cause) with preserving company mission. Hence why I was confused by you addressing it. It would never cross my mind to argue that size has protected Costco.
I haven’t read your book, just skimmed the post so I don’t know if it’s convincing. But I’d like to argue that those companies failing their mission is proof that they did not have good leadership. however, that makes the argument a little circular.
I’m aware of FedMart (Acquired podcast on Costco is very entertaining). I think Sol Price was a bad leader and selling out to Hugo Mann was putting profit above other things.
I read the comment as arguing that leadership is necessary, not that it is sufficient. That is, that no amount of governance could have prevented the change in the price of the hot dog; only the leader could.
Interesting in that I wonder whether government organizations and in particular the highly qualified government members and their functions can be protected in a similar manner from political leaders elected in a democracy.
This reply genuinely reads like AI and I don't mean to insult you. Perhaps large language models have been trained too much on your books. Your first 2 to 3ish paragraph (explanation and rephrasing) is very characteristic of an AI when they're pressed (e.g. on why they recently hallucinated).
I think it's kind of counterproductive to call out "this comment sounds like AI."
If you're right and it is AI, the comment only points out what many of us can already see. If you're wrong and it isn't AI, then the commenter you're responding to can either argue with you about how it's not AI or just say nothing because there's nothing of substance to say.
There's a dark future timeline where snark becomes the new "don't use any em-dashes" that people inject even more of to intentionally look human, since empathy and patience read as..robotic.
Certainly not the earliest example and can be interpreted in many ways but one of my favorite ancient examples of “introspection” is the phrase “Know Thyself” inscribed on the Temple of Apollo at Delphi.
Location: Salt Lake City
Remote: Yes or Hybrid
Willing to relocate: No
Technologies: C#, .NET, AWS, Postgres, TypeScript, React
Résumé/CV: josephgilmore.com/static/files/joseph-gilmore-resume.pdf
Hello, I am a Full Stack Developer with a focus on backend and performance. I have experience in the healthcare industry. I am looking for challenging work that has a purpose beyond making money.
The world collectively (mostly the US) spends trillions on national defense, that spending is unnecessary if we all just got along. I think you're right that everyone spending money on local semiconductor industries is even more wasteful.
Unfortunately, that defense allows hoarding wealth. If the wealth was more evenly distributed globally, there would be little reason to defend against raids.
This is how places like the US despite having 4% of the population have about a quarter of the material and energy consumption. Not to single them out, I am in Australia, it is a similar ratio.
I am not defending this situation, just highlighting its role.
Not all wars are about raiding, especially in the modern era. Putin isn’t interested in Ukraine’s wealth. Nor would a Chinese invasion of Taiwan be about money.
"No wars have been more ruthless and ravaging than “just” wars, fought in “defense” of religion, honor, or principle. If war must be, give me rather a war to capture an enemy’s wealth and territory, based on honest greed, in which I shall be careful not to destroy what I want to possess. " - Alan Watts
I think it depends on what the goal is. Like, lots of countries (and probably a few US state) could, I bet, do their own foundries for, like, 22nm. Process node names are bullshit of course, but we’re talking about stuff that Intel was doing in 2012, Global Foundries in 2015.
22nm is already overkill for a lot of applications. But, like, if your country gets embargoed, you should be able to make computer chips for cars and farming equipment. Top end GPUs? Not necessary. Some basic RISC-V cpu for compute appliances? That should be a capability that everybody has.
That doesn't sound unreasonable. That is Ivy Bridge/Intel Core 3rd gen capabilities. You aren't running a generative AI but can do all manner of work loads. Combined with some software efficiency gains and you could be fairly comfortable.
This part of why I have been advocating for years that the open source/free software folks should be focusing on optimization and stability/security as long term it will probably be much more useful that adding features that can be dumped on top.
Sounds like a huge infusion of cash to highly skilled workers, and supporting the building of skills that can be transferred between companies sounds like a good thing.
Whats wrong with redundancy? Not having redundant supply of anything is a problem as human history has repeatedly shown. I think this kind of modern "more profit = more better" is just a ticking time bomb for a massive disaster, and it isn't like we haven't had any warning signs about critical supply problems for any number of resources and goods.
If you can print the money required with no bad consequences, go right ahead and build all the redundancies.
The problem with bleeding-edge fab is it's a (fast) moving target. It's not a solved problem. And customers can't simply migrate their designs to a different fab, as the designs are increasingly specific to a process.
I do think we need more fabs but not this kind. Very low cost fabs with standardized PDK and open(ish) tools, should be as simple as ordering a PCB. Not going to happen anytime soon though, needs old fabs to stop production and the bleeding-edge to hit a hard wall. Can't compete with fully depreciated legacy fabs/nodes.
This is too glib: If you imagine a world where every critical industry is replicated in every large nation, often inefficiently or inadequately, that’s a world where the average person is much, much poorer.
It’s a tradeoff between resilience and efficiency.
You can go for full efficiency if you want, but then like the US auto manufacturers learned during Covid, you don’t have any way to handle disruptions to your business
The premise of this thread is that efficient markets and comparative advantage won’t leave even a large nation with enough of the right competitive local industries for national security or whatever objective.
Thus to sustain those industries (semiconductor fabrication in this case) industrial policy (subsidies, tariffs, government investment, “Buy American” rules, … ) is essential.
I agree that industrial policy is essential for a nation that wants to ensure that competitive industries exist within the nation's economy.
But the justification I replied to was that the nation must inherently suffer material inefficiencies for a nation to do this, due to how economies work, which is not the case (or at least, no real justification was offered other than the heuristic that larger firms are somehow inherently more efficient, which if anything is opposite to my experience in a very large org).
A nation might well implement an industrial policy so as to pessimize its local industries that survive, but that is not required to happen either.
I don’t think the problem with the Soviets was doing everything themselves, which seems to be working okay for China. The problem is that centralized planning doesn’t work, and the system dehumanized people and destroyed incentives for people to innovate.
Author covers how IANA handles Königsberg, it is logically its own timezone.
An IANA timezone uniquely refers to the set of regions that not only share the same current rules and projected future rules for civil time, but also share the same history of civil time since 1970-01-01 00:00+0. In other words, this definition is more restrictive about which regions can be grouped under a single IANA timezone, because if a given region changed its civil time rules at any point since 1970 in a a way that deviates from the history of civil time for other regions, then that region can't be grouped with the others
I agree that time is a mess. And the 15 minute offsets are insane and I can't fathom why anyone is using them.
Koenigsberg was conquered by the Soviets in April 1945, but the final Soviet-Polish border was only established in August of the same year. I wonder when the official switch to EET was made. For several months, the future of the city was a bit uncertain.
sad but true: learn "yes" then learn blame other grugs when fail, ideal career advice
When I first entered the corporate world I thought this wasn’t true, there was just poor communication on part of technical teams. I learn I wrong. grug right.
Hello, I’m an experienced full stack developer with a focus on backend, performance, and technical leadership. I am looking for an opportunity where I can work with customers and stakeholders to solve the right problems, rather than just slinging code.
It doesn't have to be the worst possible implementation to be less desirable than the walled garden for me. I get so much spam in whatsapp, groupMe, telegram, and from sms. Some of it is even from legitimate contacts but then they signed up for something or did something and it sends one of those stupid "join me on {thing}" messages. The only place I don't get spam is imessage
I get spam on iMessage, and you can continue to live in the walled garden, nobody wants to force you to buy a third party watch, they just want third party devices to have the same API access as the first party device.
Which it doesn’t seem you have refuted in any meaningful way. You just restated what the parent comment is responding to with no further reasoning as to why leadership doesn’t account for it.
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