The survey is complete and thanks to all alumni and students who responded--111 strong! Big takeaway is that mean total compensation is close to $100K! See the details in the slideshow below.
In The Unwinding, Packer profiles Silicon Valley's unwinding through several characters. One is Peter Thiel, a co-founder of PayPal and an early investor in what was called "Thefacebook." Thiel started a hedge fund called Clarium Capital and his initial investment in Thefacebook gave him a 10.2% stake that was later worth $1.5 billion. Thiel went on to provide seed funding to tech firms such as Palantir (to combat fraud by Russian gangsters) and continued to build up wealth, with his fund hitting a market value of $8 billion in 2008.
Then, the unwinding hit. It didn't help that Thiel had a $6.5 million mansion in San Francisco and a $27 million oceanfront spread on Maui. He became more active in his hedge fund, going long as the market tanked, shorting stocks that subsequently rose. Ultimately, his hedge fund's assets were down from $8 billion to $350 million, a colossal loss signifying a rare failure from such a bright star in the technological landscape. That represents an almost 96% loss in three years. Those of us in an S&P index fund only suffered a 7% loss in that timeframe, and, by buying and holding through all the unwinding, are now up nearly 43% compared with 2007 (before the Great Recession).
I recently read "The Unwinding" by George Packer. What's an engineer doing reading a history book? I received this from my father-in-law for Christmas--he's a retired English professor. Packer's book won the prestigious National Book Award. As I started reading it over the Christmas break, I found it hard to put down. Packer has written a recent history in novel form, focusing on several real "characters" and updating their situations as you go through the book. The title "The Unwinding" refers to the return to simplicity and our earlier ways after complicated versions failed. For example, the term "unwinding" in the financial sector refers to closing out or liquidating complex investments such as securitized mortgage obligations, derivatives, and other financial detritus that many Wall Streeters don't understand (and certainly, most of us don't).
Back on Main St., unwinding refers to more reliance on ourselves and neighbors to provide for our subsistence--the return of the vegetable garden, pesticide-free and organic growing methods, generating our own energy through solar, wind, and other means. Above is a picture of one of Packer's characters at his Virginia business. This is Dean Price and his partner at Red Birch Energy, where Dean manufactured fuel from spent cooking oil and built the first biodiesel truck stop. All did not go as planned, but Dean's story is compelling as he worked his way through the unwinding.
I'll post more on "The Unwinding" in future posts.
This classic article by Steven Kerr (1975) shows how many organizations reward one behavior while hoping for another. One example is that dentists get paid for finding and filling cavities while hoping for good oral health. Kerr would argue that dentists should be paid for the number of healthy mouths.
On to Venezuela--this one is courtesy of one of my MS Engineering Management students from that country. He told me that Venezuela made a change around five years ago to not allow employees to be fired for an unjustified reason. This was to improve family stability, income, etc. Well, the employees quickly found out that being absent two days in a row is not justification for being fired. This has led to a huge increase in absenteeism in Venezuela, including government positions because of all the state-owned businesses. Back to the article, this is an example of emphasizing equity over efficiency.
Engineering Management professor and researcher specializing in Empathic Design, workplace resilience, and the study of healthcare organizational cultures