[diego]

Large companies have lots of employees not because they need them, but because they can. Many of the people who are good at leadership happen to like empire building and having reports. Every employee in a company is also an evangelist and a marketer, without even trying. Everyone answers the question "where do you work." Having lots of employees gives you slack, and it's easy to get rid of the slack with layoffs.

[crazygringo]

The economy today is more competitive than it's ever been. Hiring lots of unneeded employees is one of the easiest ways to obliterate your entire profit margin -- you'll go out of business and your competitors will eat your lunch.

So no, there is absolutely no truth whatsoever to your statement. Of course companies make mistakes and overhire sometimes, just like they make mistakes and underhire sometimes. Nobody can estimate future headcount needs perfectly without a crystal ball.

But the idea that companies are just hiring extra people "because they can" in order to "build empires" and "have reports" is one of the most nonsensical things I've ever heard. And I say this having worked at multiple large companies.

[doix]

> But the idea that companies are just hiring extra people "because they can" in order to "build empires" and "have reports" is one of the most nonsensical things I've ever heard.

This definitely happens, I'm not saying that is the case here, but to dismiss it outright is pretty nonsensical in my view. Obviously it's not the "company" strategy to hire people and waste money, but company incentives and individual incentives start diverging very quickly in large cash flush companies.

The best thing for the company isn't necessarily the best thing for an individual to get promoted. I have definitely worked on projects that were entirely pointless and only existed to "use up resources" and justify hiring more. Bigger teams require more levels of middle management which results in promotions.

Again, not saying this is the case here.

[fallingknife]

I have personally seen empire building at companies as early as series B. It definitely happens, especially in the weird VC ecosystem where raising the next round is entirely dependent on revenue growth rather than profitability, which is always just assumed will come eventually with scale.

[hdjjhhvvhga]

While I agree with you, I've also seen some crazy stuff that was hard to process for me, and I personally had to burn a lot of cash just because we were assigned it.

[ravenstine]

Right, and what that slack can mean is if SHTF then they can throw a bunch of people at the problem. Doesn't matter if most of those people are idiots because the point isn't even to solve the problem per se but for responsibility to be evenly distributed.

[dominotw]

This only works if incumbent is immune from competition due to regulatory capture and other roadblocks for new entrants. eg: healthinsurance cartels.