Rackspace Founder Says It's 'On Trajectory of Death' (expressnews.com) 75
Richard Yoo, who founded and helped build the website hosting company that became San Antonio's premier technology firm, believes he's watching its collapse. From a report: The reputation of the company now known as Rackspace Technology, he said, "is eroding rapidly" after years of shifting business plans, executive shuffles, financial losses, staff cuts and, finally, the Dec. 2 ransomware attack that left tens of thousands of customers without access to their email, contact and calendar data.
"This is the beginning of the end," Yoo said last week. "It's already just a midsize business in San Antonio. This is not a company that's on a trajectory of growth. They're on a trajectory of death. It will not be around." He puts the blame for Rackspace's deepening financial struggles -- it's posted a steady string of quarterly losses, and the value of its stock has fallen 80 percent in the past year -- on its replacement of tech-oriented leadership with board members and managers "who don't have any connection with the product." He said there's "no culture" at the company after it laid off hundreds of local staffers while it expanded globally. And he scoffed at the idea of being a "Racker," saying he never adopted the term the company uses for its employees and identity.
"This is the beginning of the end," Yoo said last week. "It's already just a midsize business in San Antonio. This is not a company that's on a trajectory of growth. They're on a trajectory of death. It will not be around." He puts the blame for Rackspace's deepening financial struggles -- it's posted a steady string of quarterly losses, and the value of its stock has fallen 80 percent in the past year -- on its replacement of tech-oriented leadership with board members and managers "who don't have any connection with the product." He said there's "no culture" at the company after it laid off hundreds of local staffers while it expanded globally. And he scoffed at the idea of being a "Racker," saying he never adopted the term the company uses for its employees and identity.
When MBAs take over (Score:5, Insightful)
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Indeed. "A good decision is based on knowledge and not on numbers." Plato
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MBA's are often taught to measure as much as possible and then manage based on the numbers. Also known as spreadsheet-based-management.
But the problem with technology is that important factors are either hard to measure or too expensive to measure. This causes the MBA's to manage based on the sub-set of factors they can measure, which leads to mayhem, as employees starting "kissing up to the numbers" instead of try for an overall good product. They skimp on the unmeasured factors to fluff up the measured on
Huh (Score:1)
A common extreme example is paying developers by line of code.
Have never heard of people being paid by lines of code, but I guess that would explain why COBOL and Ada still exist!
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Often it's anecdotal such as a new manager coming in who is unfamiliar with programming and wants "better metrics". They are usually talked out of using line-counts early on such that it doesn't become a production practice. But that mentality rots other things.
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Indeed. Here is a nice variation of the topic: https://dilbert.com/strip/1995... [dilbert.com]
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i should get back to rpg, then. with max one (1) operand per line i'd say only asm would beat that.
now, seriously, i've never heard about coders being paid for the line, but heavy reliance on generally misleading or directly irrelevant metrics (hours/lines/classes/members/references/calls/whatever) is indeed very common, and not only by mba. although, unlike mba those decisions tend to be just suboptimal or meaningless but don't usually destroy businesses.
Re: Huh (Score:3)
Iâ(TM)ve worked at a place where QA were measured on number of issues logged. It was horrible: so many irrelevant cosmetic UI issues flooding the bug tracking system and so many important issues missed.
Re: Huh (Score:2)
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I can believe it was probably a temporary policy created by management of the day, rather than something they did historically, but I'd be curious to know if people with direct experience of IBM in the mid-1980s can comment.
It's a term from much earlier than that.
Punch cards held a fixed number of characters, the first IBM punch cards were 80 characters for instance, and that was the maximum length of a "line". One line per punch card.
It doesn't matter if your punch card was 1 character or all 80, you still used up an entire card to store it.
So it made little sense to count characters, words, etc. You count by card, or line. Thus LOC (lines of code)
Assembly language was a "one statement per line" language.
You didn't have tex
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Indeed. Most things, but especially quality measures in not yet fully established disciplines are a) high-dimensional and b) for many dimensions you cannot get really meaningful numbers. That is why an expert evaluating, for example code quality, may give some numbers or a green-yellow-red rating, but the actual evaluation will be in text-form and that rating will only say how critical is it to "do something".
And that is why the MBA-approach does not work. Is wilfully ignorant of everything you cannot measu
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There is a real challenge that you often see companies manage by things that they can measure easily, instead of things that are actually of value. A common example is measuring developers and teams' productivity by lines of code generated, when often high value work is a small number of lines that required deep thought to get right, while cranking out tons of lines of code might be a low value activity, so treating lines of code as meaningful can create a perverse incentive to reward people doing easy work
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Unless your a Neural Network.
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Well, yes. Actually, that sums the limits of ANNs up pretty nicely.
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I also see that the big tech giants today (Microsoft, Google, Facebook, Oracle, Amazon etc.) are basically pulling the rug under the feet for small and medium size hosting services as well as killing a lot of the customers as well.
Where there used to be a thriving forum there are now facebook groups for similar subjects and the forums are dying.
Mail services are also dying off, killed both by spammers and by increasing anti-spam measures so that old time mailing lists are considered spam and so on.
There are
Warning to all MBAs and bean-counters: (Score:5, Interesting)
You can't do what the computer geeks can do, and you can't do something else that's better instead. You may be able to maximize your short-term profits while sucking a company dry but you owe it to yourselves to learn from this example and try to do better for the long term. People will respect you more for it, and let's face it, that's what you really crave, isn't it?
Re:Warning to all MBAs and bean-counters: (Score:5, Informative)
Ya, they like to be respected, but lets face it, they like money way more. WAY more.
People become MBA's most of the time because they want to become wealthy. Oh, a few have a business idea and want to learn how to develop it, but most sign up for the program of study because...well, it's like when they asked bank-robber Willie Sutton why he specifically robbed banks: "because, that's where they keep the money."
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Meh... I thought about an MBA, but really I learned most of the stuff through Junior Achievement in high school, along with engineering finance classes and the process of starting and running three different businesses. The MBA gives some credibility though that actual experience doesn't though.
The benefit of getting an MBA at a top school is the connections you make and not the education. Not much of a benefit of getting an MBA anywhere else.
Re:Warning to all MBAs and bean-counters: (Score:4, Insightful)
Vampires (Score:3)
They're pretty much vampires. Once Rackspace is sucked dry and the remains are sold off they will find another victim.
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They can always sell to EIG...
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People will respect you more for it, and let's face it, that's what you really crave, isn't it?
CEOs want profit. That's it. If they wanted "respect", they wouldn't act like greedy psychopaths.
Grow up and recognize the real world.
Yes Southwest was sad to see (Score:1)
See also: Southwest Airlines. This is exactly what happened over the past 20 years there.
That is really a shame as it's one of my favorite airlines, and they have managed to keep up a facade of being the same company they used to be... but recent massive failures show they really are not.
I sure hope they do not go the way of Spirit, or more likely Frontier...
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> You may be able to maximize your short-term profits while sucking a company dry
That often "works" for them: they cut costs, profits temporarily go up, they vote their buddies all raises as a reward, and then bail out for a new victim when it falls apart after word spreads their product/service is crap. Rinse, repeat...
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People will respect you more for it, and let's face it, that's what you really crave, isn't it?
i'd say they are quite content with showing off their vacation pics, the mba is just the way to pay for those vacations when your only talent is your verbiage. imo it's not respect they seek, but leverage in the organization to get that verbiage to work for them.
At work, never trust anybody in a suit. (Score:2)
Vulture Capitalists (Score:4, Insightful)
https://www.computerweekly.com... [computerweekly.com]
There’s plenty of tech examples where good companies are swallowed by investment holding companies and turn to shit. Rackspace is just another victim of that mentality.
This is capitalism. This is how it works, and this is the result.
This quote was printed in the New York Gazette in1765 and is part of the mantra that lead to the American Revolution: "Is it equitable that 99, or rather 999, should suffer for the Extravagance or Grandeur of one? Especially when it is consider’d, that Men frequently owe their Wealth to the Impoverishment of their Neighbours?"...
Sound familiar?
Re:Vulture Capitalists (Score:5, Funny)
You can say fuck.
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You can say fuck.
But you don't have to.
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Sure, instead you can spell it phuck and look like you're trying to be a 1990s BBS cool guy.
Re: Vulture Capitalists (Score:2)
Re:Vulture Capitalists (Score:5, Insightful)
And yet for all the flaws of capitalism, it's still the LEAST corrupt governing system.
I'd love something better.
We just haven't found it yet.
And for each toxic company you identify, I can find one that isn't toxic.
It's a spectrum, not just all bad.
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capitalism is not the LEAST corrupt system, you have many capitalist countries with high level of corruption! that is not usually related with the system, but with both the cultural, economic power of the country and strength of the judicial power
Cultural, countries with more sense of community and helping ideals, are less corrupt. Countries with more individual view and elites, get more corrupt. You also have history, if in the past corruption was accepted, it takes many generations for that to reduce, as
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And yet for all the flaws of capitalism, it's still the LEAST corrupt governing system
capitalism is not a "governing" system. if you mean "democracy" then, sorry to say, as much as i concur it is so far the lesser evil, it is corrupt to the bone just like any other system. corruption always finds a way.
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And yet for all the flaws of capitalism, it's still the LEAST corrupt governing system.
Erm... Capitalism isn't a system of governance. It's a system of economics.
And like all economic systems if taken to an extreme, it is a terrible system. This is why no nation runs a pure capitalist system, the more extremist you get the less flexible and more corrupt it gets. Most countries operate what is called a "mixed economy" which utilises various parts of different economic systems (I.E. parts of market economies combined with other part of planned economies).
It should be noted that whilst pur
Yay Capitalism! (Score:1)
Turning innovative, fun companies into soulless drone factories since forever.
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Turning innovative, fun companies into soulless drone factories since forever.
Would the workers of the world prefer being worked for slave wages in those exciting communist-driven factories full of life and prosperity?
Maybe we should stop pretending Greed is really all that different the world over. It isn't.
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2. The workers are currently being worked for slave wages in those capitalist factories owned by the rich and oligarchic classes. At least in an ideal communist society everyone would be receiving the same share of rewards for their work (too b
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1. You don't know what communism is....At least in an ideal communist society everyone would be receiving the same share of rewards for their work (too bad we've never seen one of those on Earth).
As you preach to me, thank you for confirming the entire planet doesn't really know what "real" communism is, because it's never existed.
Citizens were sold that "ideal" society concept. The reality is that every -ism has it's greedy corrupt faults, because fucking humans are involved. Go figure.
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We're working on a new reality that doesn't involve humans in decision making processes. Stay tuned. We'll elect our first AI senator any day now. Then the true work of improving the world can begin.
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We spent decades fighting off communism with tons of people dying to keep it at bay. Now we gets putzes like the parent advocating for it. Know how many people died trying to leave communist countries? Let that sink in.
Government has one purpose: To let business thrive. It doesn't exist for handouts, nor building free stuff for people. It exists to ensure that businesses can run at optimum efficiency, and protecting them from criminals and terrorists.
The parent poster needs to read less Marx and Engel
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They generally do enjoy a decent mixed economy where they have a social safety net and respected rights in the workplace.
"Racker" FFS! (Score:2)
Pet names for employees - has this trend been around more than 10 years? That's when I started to notice it being forced upon a company from above in a "We have no ideas, so we'll do this" management move to attempt to force a culture where one doesn't exist, or has been destroyed by MBA's. The longer I stay in the tech world (and it's been a looong time now!) the less impressed I am with tech management - and with tech workers in general actually. I've seen more company-closing moves in the last 10 year
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It works when the employees think like children who received participation trophies.
Those employees are also easier to control, so it's not without evil value.
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Pet names for employees - has this trend been around more than 10 years? That's when I started to notice it being forced upon a company from above in a "We have no ideas, so we'll do this" management move to attempt to force a culture where one doesn't exist, or has been destroyed by MBA's.
MBAs have a lot to be embarassed about these days, but I highly doubt the term "Racker" is one of them.
That sounds like some shit coming straight from the adult child who should have never been given a participation degree, who became a member of Rackspace management.
Sounds about right (Score:1)
Pet names for employees - has this trend been around more than 10 years?
Not sure if it has been, I feel like originally the intention was to bring about more a sense of cohesion, initially the intent was not even forced...
When a company is doing well I think it may be even a mild positive but if a company starts sliding the term can add weight to the anchor.
Only thing worse than MBAs is no MBAs (Score:2)
Yoo cashed out because he couldn't do the work necessary to administer a large business. He couldn't have gotten the company to the point of having these kinds of problems.
That's not to say that the work to maintain the business is the same as the work to grow a business, just Yoo has no idea either.
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Yoo cashed out because he couldn't do the work necessary to administer a large business. He couldn't have gotten the company to the point of having these kinds of problems.
Bragging about the ex-CEO who couldn't manage to take the company straight into bankruptcy death.
Not sure if Yoo is expecting a handshake or a slap for that comment.
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Yoo cashed out because he couldn't do the work necessary to administer a large business. He couldn't have gotten the company to the point of having these kinds of problems.
That's not to say that the work to maintain the business is the same as the work to grow a business, just Yoo has no idea either.
Think of MBAs like sysadmins.
At a certain point you need them to keep things running smoothly.
But you don't necessarily want them to call the shots.
For instance, a sysadmin wants everyone to have identical hardware and software because it makes their jobs way easier, but that doesn't really serve the needs of employees who need a different or more powerful system.
A sysadmin might want to stay on the previous version of a library because it's still supported and doesn't require a bunch of annoying dependenci
Problem is with investors, not corp management (Score:2)
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Rational - stock market problem - shorts needed (Score:2)
Can they even compete anymore (Score:3)
Rackspace wasn't cheap during their heyday. What niche do they still occupy? How can they compete today with the big (and small) hosting and cloud players?
If you're looking for cheap, there are many other options. If you're looking for enterprise, AWS and Azure are dominant.
Where does Rackspace even fit in?
Fanatical support (Score:1)
Do they still have the straitjacket?
Paywall (Score:2)
How hard is it NOT to post paywalled articles for fucks sake !
He should go back! (Score:2)
Get his company back!
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Get his company back!
I'd consider it ;) would take lots of work to get everything back tip-top, however
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Woah, is that really you? :O
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Woah, is that really you? :O
Yes - it is! :D
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Nice. A /. fan. :)