The Many-Hats-Problem: Difference between revisions
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Recently while visiting some friends I asked Ramone, a retired military officer who is nonetheless a consummate small business owner, for advise about our business. We talked about valuing labor; and what he had to say was obvious only after I had a minute to think about it. You have thought about hiring an employee, he said, but what would you need to pay someone who can do <strong>every job</strong> you do? Where would you find that person? How much would you have to pay them? That is the many hats problem. | Recently while visiting some friends I asked Ramone, a retired military officer who is nonetheless a consummate small business owner, for advise about our business. We talked about valuing labor; and what he had to say was obvious only after I had a minute to think about it. You have thought about hiring an employee, he said, but what would you need to pay someone who can do <strong>every job</strong> you do? Where would you find that person? How much would you have to pay them? That is the many hats problem. | ||
I suspect that most businesses deal with this by breaking the tasks into well defined units, systematizing each, and hiring and training an employee to each task, and paying each employee as little as possible in order to maximize profits. I suppose that this process was fashioned by the Remingtons and Fords of history. But this is not really the type of business we would like to do. We would like to enhance human capital while enhancing our business. I think this means partners and automation. Both of these things require capital investment, and I am not sure how to secure any capital without compromising control. | |||
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Latest revision as of 19:35, 22 December 2022
The Many Hats problem is a serious issue facing a small manufacturer like Impulse Launch Systems. The founders took on the challenge because we have the ideas and creative capacity to work through a manufacturing process for a valuable product.
Recently while visiting some friends I asked Ramone, a retired military officer who is nonetheless a consummate small business owner, for advise about our business. We talked about valuing labor; and what he had to say was obvious only after I had a minute to think about it. You have thought about hiring an employee, he said, but what would you need to pay someone who can do every job you do? Where would you find that person? How much would you have to pay them? That is the many hats problem.
I suspect that most businesses deal with this by breaking the tasks into well defined units, systematizing each, and hiring and training an employee to each task, and paying each employee as little as possible in order to maximize profits. I suppose that this process was fashioned by the Remingtons and Fords of history. But this is not really the type of business we would like to do. We would like to enhance human capital while enhancing our business. I think this means partners and automation. Both of these things require capital investment, and I am not sure how to secure any capital without compromising control.
