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by Experimentalist 5772 days ago
I'm glad to see a post highlighted here which shows the limits of bright engineers and hacking in a business. Google Wave is just one high profile example..

Being full of engineering-minded people, Hacker News has a strong bias favoring the idea that if you hack away and create an interesting piece of technology, then that is what is required for a successful startup business.

That idea is wrong. That idea is more of a love of inventing and obsession over technology rather than successful business.

A successful business doesn;t need neat technology or having brilliant engineers.

It requires a product/service meeting consumer demand at the right time in a sustainable way at a cost that enables a profit for the business.

That's where Google Wave failed. Despite a huge financial backing in engineering and promotion, people didn't want it.

The core for a successful business is not innovative technology-- it's Business Operations.

If the business operations are wrong -- ie a product isn't fulfilling a consumer demand or has an sunsustainable cost-- then the startup is going to tank. (unless angel investors keep throwing money at it, but eventually they won't anymore)

On the other hand... if the business operations are right, ie. there is strong sustainable consumer demand for the product/service and a cost enabling a profit, then the the company will prosper regardless if the engineers are decent, great or so-so.

There are plenty of companies making good profits year after year, growing there business and equity sustainably, which have just ok engineers and average non-innovative software.

It would be nice to see more startup-related articles here on Hacker News showing technology failures, not wasting money on too much engineering and the importance of the business operations side of things.

5 comments

This attitude was precisely what turned me away from Google. I interviewed for what they call the Rotational Assistant Manager Program (RAMP), which in reality is rotational and management related only in that you go through several different marketing positions.

I'm reasonably well versed in technology; I know my way around a rails or python app, have a good understanding of massively parallel computing, and can explain how PageRank works. Yet as a nonengineer at Google, you get zero input on new products. Development is almost entirely handled by engineers, with very little input from the outside.

Coming from a highly integrated startup perspective, I thought it was crazy. After years of indoctrination in A/B testing and user feedback loops and agile development, a tight integration between development and marketing/customer facing teams is almost an expectation.

But when I raised the idea of bringing in marketing to the start of development, the Googlers gave me funny looks. Engineers run the show, then hand it off to the marketers to sell; there's no real mingling between the two. At the onsite weekend, where we interviewed side by side, the engineers and the marketers weren't even allowed to sit at the same table for meals. Clinging to its technical heritage is hamstringing Google today.

So you want to read about companies with no competitive advantages anywhere in the organization? Maybe some big firm that uses its marketshare to enforce a significant amount of revenue as opposed to better handling of operations, marketing, R&D, customer support, sales, etc?
Technology isn't the only comparative advantage.

Nor, is it necessarily the best option when maximizing comparative advantage over another firm.

Nor, is implementing new technology necessarily a comparative advantage, it could be a disadvantage (ie. if the technology fails either technically or on the business side)

It's often the most difficult or worst option because of the costs and risks involved.

You are 100% right but that's not a popular view around here. All it takes is two guys and two laptops.

I think in part that is because with YCs backing the two guys with laptops actually stand a chance of success. If the two guys with laptops had to make it 'on their own' it would turn out to be a lot harder.

Absolutely true, execution is what matters. You can make a good business from a pretty standard idea. And the history is littered with examples of great technology that never succeeded, or only saw limited success.

On the other hand, you can have brilliant business operations and virtually no innovation for decades, until a better technology comes along and tanks your business. Although investing in technology is risky, failing to invest in new technology can be far riskier.

I'm pretty sure Nokia has great business operations, but considering how they're scrambling to release a new (wait, two new) mobile operating systems in response to the iPhone, they apparently failed to invest (or invest in the right) technology.

A.A successful business doesn;t need neat technology or having brilliant engineers. B.It requires a product/service meeting consumer demand at the right time in a sustainable way at a cost that enables a profit for the business.

Sometimes B isn't possible without A. Agree with the rest.