How to make wealth


Here's an interesting essay: How to make wealth, by Paul Graham.

I do think he's wrong on one point though:

There is one other job besides sales where big companies can hire first-rate people: in the top management jobs. And for the same reason: their performance can be measured. The top managers are held responsible for the performance of the entire company. Because an ordinary employee's performance can't usually be measured, he is not expected to do more than put in a solid effort. Whereas top management, like salespeople, have to actually come up with the numbers. The CEO of a company that tanks cannot plead that he put in a solid effort. If the company does badly, he's done badly.

In my experience, just because someone is a highly paid manager, doesn't mean that he is at all competent at his nominal job. He may be riding on the coat-tails of hard-working employees by taking credit for their successes and blaming them for failures; or his real job may not be his nominal job.

What do I mean by the last? Well, look at the case of Michael Brown, head of FEMA during the recent Hurricane Katrina Disaster. He was clearly not all that good at heading a disaster management organisation. Perhaps his real job was to be a known crony of the Bush administration, and thus a useful contact towards getting further government contracts. (See this comment at Making Light.)

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This page contains a single entry by dave published on January 24, 2006 1:08 PM.

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