It’s not the only field, but I would say for white collar salaried work, it typically gets the short end of the stick.
You have to look at the economics of computer programming. It is a highly skilled profession, however the technology changes so rapidly that frequently the positive benefits of experience are often offset by the decrease in demand for a specific technology over time.
Quite frequently, computer programmers have a limited time to develop their product before it the technology becomes obsolete or the application becomes irrelevant.
So unlike say, law or accounting, there is less value in programming for cumulative experience. Unless you go into the business or client management side at a consulting firm like Accenture, the Big-4 or your own business, there is limited value in being the worlds greatest programmer.
Another thing that contributes to the insane workload is that 1) the application actually has to WORK and 2) no one really knows how to project-manage the creative process of writing code. A stored procedure can take an hour or it can take a week. And sometimes you have these bugs that you simply can’t figure out. Or fixing one thing breaks something else. It’s not like accounting where a general ledger is always written in the same format. Much to my bosses surprise, I cannot simply walk into the office day one, pick up a system consisting of 1000s of lines of undocumented, non standardized code spread across half a dozen databases and tell him how long it will take my team to fix it.
Ideally you always want to work for a company that sells what your particular area of expertise is. At least initially. An accountant in most companies is a sort of mundane back office cost center. However an accounting partner at Ernst & Young makes well into six and possibly seven figure salaries.
But ultimately it becomes some version of either “selling” or “being the world renown expert” in something.
At least that’s how I see it. I’m not “smart” enough or patient enough to navigate some giant companies incomprehensible beurocracy over 30 years until I make Senior Vice President of Pushing Paper.
We should also, again, note that what you’re advising on is “how to get lots of money”, and being a competent employee who makes enough to be stable if not upwardly mobile is something you most certainly can do in a cost center if you have more work ethic than ambition to move up in socioeconomic status.
I agree with that, too. But in referencing my examples above, if you are the IT Guy/Gal helping a business to structure and scale a tech-driven model you can be “in on the money”…
The presumption here is that you are upwardly mobile or interested in being so. There is also the Office Politics 101 thread for those who just want to stay in the same roll for 20 years.
And yes, you can be quite successful running a cost center support type roll. You can become THE GUY for whatever that particular area is. Head of procurement or marketing or whatever. The problem is that it can be very difficult to rise into that role.
Most people typically start their career out of college in the entry level position for their field. They typically report to some sort of manager or team leader who reports to a department director who reports to the VP of that business unit and so on, or something very similar. Your actual ability to get promoted to a real position of real responsibility (as opposed to promotions in name only like Analyst II, etc) directly depends on the size of the company, the rate of growth of the company and the churn rate for people who work there. If you don’t work for a company that is large enough for you to move around in, isn’t growing, or doesn’t churn through employees quickly (but not so quickly you are likely to get cast out in 18 months as part of their “up or out” culture), it’s not likely you are going to rise very quickly. That guy who has been the director of accounting for the past 15 years is probably pretty comfortible.
There are places like Dunder Mifflin Scranton office where the same 10 people have been there for their entire careers in the same exact position they had when they started.
Can someone explain the cost center concept to me? I’m used to thinking of economic activities in terms of whether their utility is greater than their opportunity cost or (as a proxy for such) whether their marginal gain is greater than their marginal cost.
If you have 10 widget makers each turning out 10 widgets an hour (100widgets/hour total) and that you decide to automatize such that you now have 10 widgets makers and 10 machine minders (all at the same wage) but that you’re now producing more than 200 widgets an hour, that’s a net gain and worthwhile, even though the machine minders would be considered cost centers, correct?
In the same way, a janitor is a cost center. What are the implications of the janitor being a cost center? Try going without him for a while.
This topic also comes up in military discussions when some complain that there is too much tail (the equivalent of back office) and not enough tooth (equivalent of front office).
The people who maintain and repair tanks are not on the firing lines (they’re tail rather than tooth) yet having them enables you to have tanks. The logistics people are tail rather than tooth, yet they allow you to deploy anywhere in the world. Would the tank maintenance crew and logistics personnel be considered the equivalent of cost centers? If so, what are the implications in terms of a manager’s actions?
If having 10 people behind every shooter makes him more than 10 times more effective, what’s inefficient about that?
Profit center is pretty clear - without it the company goes bankrupt. Self evident to everyone. Those guys in sales need to take customers out golfing, then figure out a way to make that happen. Whether or not it’s a legitimate need is rarely a topic of discussion. Usually, the topic will be “do you have to play golf every week instead of every other week.”
In a cost center, the question is “do you really need this $50 for a team building party once a year or can we take it out of the budget.”
I exaggerate but only slightly. MichealEmouse, most executives would say of course we need janitors but we won’t go bankrupt without one for a few days.
Zeriel, CTO of a startup versus CTO of General Motors are not comparable. By the same token, in investment banking, AVP means you’re a new college grad in the front office and VP means you finished your probation period. If you’re back office, including IT, it will take you at least a decade to become a VP.
Obviously, but nonetheless I’m well ahead of most Americans (hell, I’m well ahead of most American HOUSEHOLDS), and I’m barely in my 30s.
I prefer small but established companies to startups, for the record–preferably, the kind that’s just expanded to the point they hire an actual CEO instead of an engineer-founder running it. Those types are generally paying great rates for the 1-2 people they need in each cost center.
It’s not whether you HAVE a service that makes it a cost center, it’s whether you in-house it.
The general idea in modern management practice is to out-source cost centers as much as practical. In other words, the prevailing belief is that for most businesses it’s better to contract a marketing firm (that has marketing as its core competency) than have an in-house marketing team (that’s necessarily going to take a backburner to whatever the company does).
While the big multinationals have enough room in each division that they benefit from internal departments that are cost centers, most corporations don’t have that luxury in all departments. So for example, my company has a single in-house CTO (me) and Marketing Director, and both of us have expertise not only in our chosen field but in integrating external services rather than generating expertise and capability in-house. We don’t have an e-mail server–Google does it far cheaper than I could. We don’t have a design department or print department, we hire those. We don’t have a janitor, we pay a service to pick up and dust once a week. None of those are “cost centers” as it’s typically used when giving employment advice.
The idea is that if you’re working in a profit center then you are in a position to advance and prove value, and if you’re in a cost center you’re gunning for the top slots or just staying afloat. By the same token–if you’re a janitor at an IT company, you’re a cost center. If you’re a janitor at a cleaning company, you’re maybe still a grinder but you’re working for a profit center.
Usually it goes “Analyst”, (go get an MBA) “Associate”, “AVP”, “VP”. Loosely translated to “Underdrone”, “Drone”, “Overdrone”, “Undermanager”. Although even the underdrones in an i-bank tend to get paid pretty well.
Unless you are the head of a group with hiring and firing power and a budget, you don’t really have any real management power. And even then, you’re probably still part of some overbosse’s sub-group in a large company.
