25
April
2008

Credit people, debit people 12:38 on Friday

There are two kinds of people in any corporation:

  1. Those who make money for the corporation
  2. Those who spend the corporation’s money

Credit people and debit people.

Some people who might be in those categories are:

  1. Sales people who close deals that bring in money, managers who improve efficiency to make more money, creatives whose ideas are worth more than the time they spend
  2. Human resources, R&D, analytics, IT support, and according to the book Markkinoinnin musta kirja, marketing

Etc. I could probably continue the list if it wasn’t half past midnight while I’m writing this.

The point being, when the corporation hits a rough spot, where do the managers go to create savings? Well, the obvious choice is to cut the people who only spend money and not make it. Markets behaving unexpectedly? Let’s get rid of our analytics specialists! Utilization low? Let’s outsource IT support! New products not doing as well as expected? Cut the R&D budget!

Silly. Yet that happens. Reactive, not proactive.

This entry was posted on Friday, April 25th, 2008 at 12:38 and is filed under English, Work (and life). You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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2 Responses to “Credit people, debit people”

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  1. Tommi Vilkamo Says:
    April 28th, 2008 at 21:21

    Niko, I’m sure the “silly savings” thing, the kind that resembles pissing to your pants to make you warm in the winter, is commonplace across the planet. But dividing people into those who make money and those who spend it is (at least in the company I work for) hugely artificial – up to the point of being nonsense. In most cases, you just can’t make this distinction anymore. At least I couldn’t classify >90% of my coworkers.

    But also, I claim that it is often impossible to calculate the true value of an individual worker. Say, if you have a team of 10 people, each indispensable, producing $1M as a team. Is a team member worth $1M or $0.1M? Beats me.

  2. Niko Says:
    April 28th, 2008 at 22:47

    My polarization was intentionally very black & white to make the point — yes, it is very difficult to make the distinction for some people, yet I think there are some people who are constantly thought of as “an expense”. Which is totally, horribly wrong, of course.