Regarding the article written by Yanis Varoufakis on Why Valve? Or, what do we need corporations for and how does Valve’s management structure fit into today’s corporate world?, there are some thoughts that I would like to express, as I feel that hyperbole and generalization on the part of a writer, although thought-provoking and appealing, are generally irresponsible to the reader if the other part of the argument is not explored.
Go read the great article, but to summarize, Varoufakis describes the way Valve is run as a corporation, with its flat-hierarchy and no-boss culture, where employees are free to move their desks to go work on whatever project they are interested in. In a sense, he describes, corporations are usually directed by the decisions of a small group, in contradiction with the spirit of free markets, where people decide what they do based on signals received by the market. Valve adjusts to this latter spirit by democratizing the direction of the company thanks to the “interest signals” that employees create by telling each other what they are working on and what they find interesting.
This got me thinking on how such a structure would work in a big company, one the size of Microsoft, Google or Apple. As the author suggests, and as Valve leaders fear, the model might not scale.
My view on this is that it indeed will not scale. This utopia is beautiful and possible in small projects, but it breaks down on the larger scale. Would Microsoft or Google or Apple employees stay doing their jobs if they were free to move to whatever their passion dictated? Is there anyone at Microsoft who feels passionate about supporting Windows XP after 10 years of its release?
It seems to me that a lot of these jobs would not survive. Sure, creating games and putting them out there is so fun that the guys at Valve will do whatever it takes to delight people, but corporate users do not demand interesting novel material all the time. They value consistency and support, which comes from repetition and maintenance on the part of companies. I do not have numbers from which to prove this, but I would say that in the software industry everyone and their moms want to be innovative. Let´s say, for the sake of argument, that 95% of the people want to innovate and will take the chance to work on exciting next-generation projects if given the chance, and the other 5% is content with supporting old systems. If only that 5% of people were to support and maintain past-generation systems, customers would have a helluva hard time enjoying computer systems!
If we take Apple as an example, it was precisely the dictator-like approach that Steve Jobs had to directing the company that made the vision of the company so evident to employees and the execution of their projects so successful. It seems to me that if we left big problems to the whim of a large group of people, we would end up with sloppy all-patched-up solutions. Some problems are so big and complex by definition, that without a clear goal set by a few group of people, their solution would be impossible. Just go build Windows on that flat-hierarchy structure! I dare you! I would love to see a Windows 8 built by group consensus.
In short, yes, the Valve way of managing, or not managing, a corporation is very appealing; it’s very hip. But it will never build multibillion-dollar Fortune 500 companies. Maybe Microsoft would end up splitting in several hundred corporations, but the ecosystem, the Microsoft platform, or the Google platform, or the Apple family of products, would never exist without a top-down management system. Would Valve ever be able to keep creating anything as good as they create now were it to develop its own console, its own mobile OS, its own database system, its own multimedia platform, its own peripherals, its own cloud platform, its own desktop OS, and its own etcetera in a completely flat structure?
Maybe if a collective created a vision for everyone throughout the company, much like the Valve Handbook for New Employees does, would a company that big be able to get Microsoft-big. But that is precisely the role of the board of directors in a big company! I would love to know how often an average person changes projects in Valve versus how often an average person stays in the same team at Microsoft. Maybe the end result is not that different after all?
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