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by amitamit 1256 days ago
I was more interesting in learning about the $3T/year number. Turns out that it is eye-catching but the math here is very dubious.

They have several factors - the primary being their taking a few very specific instances of companies, declaring these companies' manager-employee ratio be the ideal, and then computing how much other companies would save if they had similar manager-employee ratio.

This is just wrong.

By the same argument, given that Apple's retail revenue is $5,500 per sq feet while Target is only $300, we should conclude that Target is wasting retail space and it should save money by shutting down 94% of its locations.

That is of course completely incorrect - these are two very different businesses. The same problem exists with the original analysis.

1 comments

Yes, $3T/y is 10% of US GDP, so this doesn’t pass the smell test.