Erik Bethke (erikbethke) wrote,
Erik Bethke

Illegal company manifesto over at T=Machine

I failed in the security certificate process at T=Machine, so I will post my comment here to Adam's very thoughtful piece on how he will design his next game company...


Great post, great ideas here.

But you are breaking the law...

The amazing thing is what you have designed here with the manifesto is actually illegal in the United States.  I am not sure about Europe's interpretation of corporate laws (I suspect they are very similar to US at their root).

Let me explain why it is illegal - Dodge vs. Ford

This Supreme Court case established that the only purpose of a company is to produce profits for the shareholders.  Any acts of good that benefit employees, management, customers or the community MUST Be by-products of making even more money for the shareholders.

All corporate charity is at its core a marketing & PR program.

The Google 20% was established to enhance the profitability of the company.

Your manifesto was actually LEGAL until you responded to Osma.  The  manifesto itself you would have to argue will result in better, faster, cheaper products that will decrease costs, or increase revenue or both for the shareholders.

However, you screwed up by saying that you don't care about the sustainability (and even more important) the profitability of your company and that you hold your values to be more important than the shareholder's interests.

So, going forward with a very straight face, say earnestly that the manifesto will create a ferociously competitive engine for shareholder wealth due to the superior organizational structure.

Of course, you do not have a company yet, or even profits that a minority shareholder could sue over yet.  But conceivably if an employee was a shareholder they could bring a suit to the directors and charge that they have failed their fiduciary duty by not running the  company in the shareholder's interests.  As a result their property rights have been damaged etc...

While this main seem esoteric, it does explain the gut, blink reaction that investors would shy away from your manifesto and back someone who says she will squeeze the most value out of their teams.

At the end of the day, like anything this is a marketing problem.  You need to find someone with the cash to fund the company who believes that they will make more money by sharing this manifesto.

I agree with the general step back and ask what are we really trying to accomplish?  My ideal would be that everyone is free to work as few or as many hours that they want.  And that their pay would be directly proportional to the value added to the project...  Working 80 hours a week and coming up with crap is crap.  Working 1 hour per week and yet getting Walmart to pre-order a million copies of your packaged $19 client is quite a bit of value for an hour.

So it is a game design problem - how to measure the value of work?  How to transparently report that?  How to empower the team itself to iterate, find their own process flaws and rapidly increase value?  As part-owners the employees should then be naturally driven to be aligned with the shareholder...

Tags: business, game industry

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