Author Topic: SpaceX reducing workforce by at least 10 percent  (Read 27868 times)

Offline EnigmaSCADA

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #40 on: 01/12/2019 04:14 am »


Some quotes from articles:

SpaceNews
Quote
The layoffs, a company source said, don’t indicate near-term financial problems at the company but rather a redistribution of resources to focus on development of its next-generation launch system and broadband constellation. They also reflect, note others in the industry, the belief that SpaceX grew quickly
L.A. Times
Quote
SpaceX is offering a minimum of eight weeks’ pay and other benefits to laid-off workers, according to Shotwell’s email. The company will also provide assistance with career coaching, resume help and job searches.

8 weeks pay part, well ok, depending on how long you've put your blood/sweat equity into the company. The "help" with job searching & resume help is an utter joke. Anyone ever who has lost a job in similar circumstances can tell you that part is so meaningless it's nearly insulting when you actually see what it is. Nothing more than a PR line for the company.

Offline mlindner

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #41 on: 01/12/2019 04:16 am »
Quote
"We had an all-hands meeting and were told to go home and wait for an email that basically says we stay or go. I have never seen a more quiet workforce in my life heading out."
https://www.reddit.com/r/spacex/comments/af1n7f/spacex_will_reduce_its_workforce_by_10_percent/edute2h/
via /r/SpaceX

It's Reddit, so grain of salt, but frankly, this seems like a very employees-unfriendly way to do the layoffs. (And I am being polite here.)

No I think this is employees friendly. They're doing it very quickly (they're getting emails same-day within hours according to the reddit thread) and they're not being forced to sit around in their cubicles wondering if someone is going to suddenly walk up to them and walk them out in front of their colleagues as they watch the same happen to their other colleagues. I'd honestly prefer to be notified while I'm at home if I'm staying or leaving and I don't have to be embarrassed in front of others as I'm walked out. It's very humiliating.
« Last Edit: 01/12/2019 04:16 am by mlindner »
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Offline mlindner

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #42 on: 01/12/2019 04:22 am »
As I understand it, generally in these situations, those fired get accelerated vesting of options.  That could be a nice parting grant for many.

https://www.latimes.com/business/la-fi-spacex-layoffs-20190111-story.html

Quote
SpaceX is offering a minimum of eight weeks’ pay and other benefits to laid-off workers, according to Shotwell’s email. The company will also provide assistance with career coaching, resume help and job searches.

So they're getting pretty generous severance packages. Someone on the reddit thread also mentioned they're getting 8 weeks + the next vestment period.
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Online Prettz

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #43 on: 01/12/2019 05:03 am »
This is because of the funding problems.

Their only "funding problem" is starting two multi-billion dollar projects at the same time.
And the argument against is what?

Offline ChrisWilson68

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #44 on: 01/12/2019 07:00 am »
It’s called Decimation... popular with the Roman Military. Reduce your ranks 1/10 th... hence decimal.... Randomly liquidate to “Inspire” the other 90% work more efficiently... operating capital increases with salary liberated from the terminated.   Not fair or kind... just is what it is...Business

This is not at all Roman decimation.  With Rome, decimation was a punishment.  Decimation was done to units that were considered to have done something really bad, such as fleeing from battle.  Their punishment was to have one in ten of them executed.

Offline imprezive

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #45 on: 01/12/2019 07:29 am »


Some quotes from articles:

SpaceNews
The layoffs, a company source said, don’t indicate near-term financial problems at the company but rather a redistribution of resources to focus on development of its next-generation launch system and broadband constellation. They also reflect, note others in the industry, the belief that SpaceX grew quickly
L.A. Times
Quote
SpaceX is offering a minimum of eight weeks’ pay and other benefits to laid-off workers, according to Shotwell’s email. The company will also provide assistance with career coaching, resume help and job searches.

8 weeks pay part, well ok, depending on how long you've put your blood/sweat equity into the company. The "help" with job searching & resume help is an utter joke. Anyone ever who has lost a job in similar circumstances can tell you that part is so meaningless it's nearly insulting when you actually see what it is. Nothing more than a PR line for the company.

When I got laid off (a site closure) the career coaching was actually pretty good and something like 80% of the people found jobs within a couple months.
« Last Edit: 01/12/2019 04:01 pm by imprezive »

Online FutureSpaceTourist

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #46 on: 01/12/2019 07:33 am »
Whatever the circumstances it’s tough on the people involved. Especially when so many will have sacrificed so much to help SpaceX achieve their goals. I really hope they find good new positions soon.

Of course this is not a new thing for SpaceX. Here’s the thread from the 10% layoffs in 2014:
https://forum.nasaspaceflight.com/index.php?topic=35254.0

Offline blasphemer

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #47 on: 01/12/2019 07:38 am »
Main benefit of reusable rocketry is that less people can do more. Labor costs are the most significant expense of a launch vehicle company. So this is to be expected. Expect more lay-offs in the future, and while it sucks for the people being let go, it is a sign of progress. Creative destruction in action.

Offline RobLynn

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #48 on: 01/12/2019 08:18 am »
So now we know why SpaceX were rushing to get the hopper shell finished even though engines are still more than a month away from being available and internal tanks aren't finished; generate some positive PR to deflect the press (along with Iridium launch) for the day of firing.  I am not faulting them for this, is a sensible way to fend off media fallout from a depressing event.
The glass is neither half full nor half empty, it's just twice as big as it needs to be.

Offline catdlr

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #49 on: 01/12/2019 08:28 am »
So now we know why SpaceX were rushing to get the hopper shell finished even though engines are still more than a month away from being available and internal tanks aren't finished; generate some positive PR to deflect the press (along with Iridium launch) for the day of firing.  I am not faulting them for this, is a sensible way to fend off media fallout from a depressing event.

and announcing the layoff on a Friday so you have the weekend for the public to forget it about, becoming old news on Monday
« Last Edit: 01/12/2019 08:30 am by catdlr »
Tony De La Rosa

Offline Star One

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SpaceX reducing workforce by at least 10 percent
« Reply #50 on: 01/12/2019 08:30 am »
Quote
"We had an all-hands meeting and were told to go home and wait for an email that basically says we stay or go. I have never seen a more quiet workforce in my life heading out."
https://www.reddit.com/r/spacex/comments/af1n7f/spacex_will_reduce_its_workforce_by_10_percent/edute2h/
via /r/SpaceX

It's Reddit, so grain of salt, but frankly, this seems like a very employees-unfriendly way to do the layoffs. (And I am being polite here.)

From that same chain you linked:

Quote
That's an unfair summary. Both Elon and Gwynne expressed how difficult this is because they know how hardworking and talented everyone is, but it was necessary to guarantee future viability. This isn't the first time this happened and won't be the last most likely. If I get laid off it'll suck but if it helps the company get to Mars I'm fine with that

https://www.reddit.com/r/spacex/comments/af1n7f/spacex_will_reduce_its_workforce_by_10_percent/eduuopw/

I've been through a lot of layoffs; they've never been pleasant but were mostly necessary.  Layoffs are the price you pay for being in a more capitalist, nimble, but also also sometimes more unfair system.  The US has many broken things and the balance of power is probably shifted too far toward the employers/management rather than the workers, but it also is the place people like Elon come to build companies.  Great things are created here, but it does come at the expense of the "little guys" sometimes.

To say it’s an unfair system is probably the biggest understatement I’ve seen in sometime.

Not being anti-capitalist but rather commenting that the playing field isn’t as flat as it should be. Also to further add this isn’t a US but rather universal issue in my view. But that’s veering wildly off topic so I will say no more.
« Last Edit: 01/12/2019 09:57 am by Star One »

Online jpo234

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You want to be inspired by things. You want to wake up in the morning and think the future is going to be great. That's what being a spacefaring civilization is all about. It's about believing in the future and believing the future will be better than the past. And I can't think of anything more exciting than being out there among the stars.

Offline DreamyPickle

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #52 on: 01/12/2019 10:07 am »
SpaceX business strategy is very confusing. The Falcon 9 is a very good launcher, but the design is "done" and reusability means they need very low production rate to sustain their launches.

They seem to have 2 major directions:

Starship is a revolutionary launcher for which there is no market! The F9 is already a very cheap way to serve most customers so the only way BFR can get revenues is by taking it from Falcon. From a business perspective it doesn't make sense to invest in this.

Starlink tries to use F9 capability to win in the leo comsat market. They have major advantages but it's an extremely high-risk bet because they're also competing with traditional telecoms and in the past ground-based infrastructure has always won.

Offline su27k

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #53 on: 01/12/2019 10:46 am »
SpaceX business strategy is very confusing. The Falcon 9 is a very good launcher, but the design is "done" and reusability means they need very low production rate to sustain their launches.

They seem to have 2 major directions:

Starship is a revolutionary launcher for which there is no market! The F9 is already a very cheap way to serve most customers so the only way BFR can get revenues is by taking it from Falcon. From a business perspective it doesn't make sense to invest in this.

Starlink tries to use F9 capability to win in the leo comsat market. They have major advantages but it's an extremely high-risk bet because they're also competing with traditional telecoms and in the past ground-based infrastructure has always won.

Not confusing at all, from a business standpoint, they're trying to break out of the launch market. The launch sector is very small, they'll never become a big company by just doing launch. Starship is one breakout direction: BLEO (especially to the Moon), human spaceflight, space tourism. Starlink is another breakout direction: telecommunication satellite market.
« Last Edit: 01/12/2019 10:48 am by su27k »

Offline Wargrim

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #54 on: 01/12/2019 11:24 am »
People are regularly confused by Musk's decisions because they measure them against conventional profit oriented business practices and decisions.

But his actions only make sense if you take his words and actually accept the idea that for him, it is about the mission and long term goals of a company, and profitability is just a means to an end, not an end in itself.

E.g. it makes zero sense to go full balls to the walls into parallel Starlink & BFR development if you just look at a risk vs. profit potential analysis. Building up Starlink on F9 with smaller initial constellation size and more gradual over time buildup would have offered a much lower risk profile with still pretty large profit potential.

But if the driver is the want for Mars, and thus BFR the primary focus, as it is essential for getting the wanted, now Starlink is just the money source and you kind of have to go parallell for maximum speed.

All his companies have been run that way, mission first, go for maximum speed even if it means maximum risk. He has regularly put entire companies at the brink of going down in flames. And thus not just 10% of employees, but potentially 100%. It is absolutely obvious he will always chose max speed over risk reduction. He will always drive both him and the workforce at maximum attrition level, and beyond. And he is ready to throw anyone under the bus who gets in the way of the mission.

Every approach has upsides and downsides, the upsides here include the rapid achievement of very impressive results. The downside is a very high human cost, lots of people end up under the bus. Cant have the one without the other. The recent 10% layoff is actually relatively small in the grand picture of Musk's way of doing things. It implies that 90% of the workforce can be transfered across in the middle of a product change, technology change, manufacturing change, material change, business model change and who-knows-what-else change.

I keep being amazed by what SpaceX has done for spaceflight, and i want to see more of it, but at the same time i am glad it is not me paying the price. I would not want to work under Musk directly, the man has no idea what a work-life balance even is. For him, his work is his life. I see working at a Musk company a bit like an extreme sport: If you want that level of excitement, sure, go for it. But do not be surprised if the risk of if materializes and you find yourself under the bus.

Offline john smith 19

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #55 on: 01/12/2019 11:55 am »
Yes, it's an unpleasant experience for everyone concerned but let's keep in mind a few things.

F9 block 5 is out and it's been stated there will be no further updates. It's done as a design. More reuse -->
much lower rate booster production. Do new customers even have the option of having a new build booster any more? If not then I'd guess booster production rate has to cover crashes and a booster reaching end of life (10 flights?). If SX have done a launch ever 2 weeks as long at you built a booster in 20 weeks you can keep up with the fleet flying out its launches.

FH seems to have been frozen as well, and it was a PITA to get across the finish line, so the 3 core approach looks like a dead end. It's done too. They've got the design. They can make more center cores if someone buys another FH launch. I'm sure there's a "Stuff we could do better next time" list (likewise with F9), but unless the changes are quite minor (or cheap) I think the design is frozen.

I'm presuming there will be a Dragon 2/Crew and a Dragon 2/Cargo variant with maximum commonality, and a goal of maximum reuse, making the production rate (again) pretty low.

SS is now SS, not CFRP, and I think it's a pretty safe bet SH will be as well. Stainless is very different from CFRP and quite a bit different than Aluminum. There are lots of people with SS experience, but many fewer with very large CFRP structure experience.

Starlink satellites have to start moving toward series production. There revenue stream could make or break SX, giving it a substantial revenue stream to reach its long term goals. That's not going to be cheap but it would give SX financial security and greater independence.

So you're Elon Musk. What can you do?

a) Approach the USG and pitch some monster programme they will fund that's made mostly of Aluminum and CFRP, keeping all those people who SH/SS don't need employed.

b) Recognize that new directions need new skillsets and new staff to deliver them and a significant portion of the old staff are redundant (in the dictionary definition of the word).

c) Come up with some other way to keep everyone employed that does not bankrupt the company in a few years (which I can't think of, but then I'm not Elon Musk).

But real life is not a novel.  :( IRL option b is the only logical option.

And assuming SH/SS works out all remaining F9/FH related staff will also go, as will most Merlin related staff since Raptors will have been sufficient to launch at least one SH/SS already. Dragon Crew/Cargo have systems relevant to SH/SS regarding ECLSS and NASA certification so they should be relatively safe if Musk wants a piece of the new NASA going back to the Moon initiative (assuming it survives Trumps presidency).

« Last Edit: 01/12/2019 12:00 pm by john smith 19 »
BFS. The worlds first Methane fueled FFORSC engined CFRP structured A380 sized aerospaceplane tail sitter capable of flying in Earth and Mars atmospheres. BFR. The worlds biggest Methane fueled FFORSC engined CFRP structured booster for BFS. First flight to Mars by end of 2022. Forward looking statements. T&C apply. Believe no one. Run your own numbers. So, you are going to Mars to start a better life? Picture it in your mind. Now say what it is out loud.

Offline Star One

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #56 on: 01/12/2019 11:59 am »
Yes, it's an unpleasant experience for everyone concerned but let's keep in mind a few things.

F9 block 5 is out and it's been stated there will be no further updates. It's done as a design. More reuse -->
much lower rate booster production. Do new customers even have the option of having a new build booster any more? If not then I'd guess booster production rate has to cover crashes and a booster reaching end of life (10 flights?). If SX have done a launch ever 2 weeks as long at you built a booster in 20 weeks you can keep up with the fleet flying out its launches.

FH seems to have been frozen as well, and it was a PITA to get across the finish line, so the 3 core approach looks like a dead end. It's done too.

I'm presuming there will be a Dragon 2/Crew and a Dragon 2/Cargo variant with maximum commonality, and a goal of maximum reuse, making the production rate (again) pretty low.

SS is now SS, not CFRP, and I think it's a pretty safe bet SH will be as well. Stainless is very different from CFRP and quite a bit different than Aluminum. There are lots of people with SS experience, but many fewer with very large CFRP structure experience.

Starlink satellites have to start moving toward series production. There revenue stream could make or break SX, giving it a substantial revenue stream to reach its long term goals. That's not going to be cheap but it would give SX financial security and greater independence.

So you're Elon Musk. What can you do?

a) Approach the USG and pitch some monster programme they will fund that's made mostly of Aluminum and CFRP, keeping all those people who SH/SS don't need employed.

b) Recognize that new directions need new skillsets and new staff to deliver them and a significant portion of the old staff are redundant (in the dictionary definition of the word).

c) Come up with some other way to keep everyone employed that does not bankrupt the company in a few years (which I can't think of, but then I'm not Elon Musk).

But real life is not a novel.  :( IRL option b is the only logical option.

And assuming SH/SS works out all remaining F9/FH related staff will also go, as will most Merlin related staff since Raptors will have been sufficient to launch at least one SH/SS already. Dragon Crew/Cargo have systems relevant to SH/SS regarding ECLSS and NASA certification so they should be relatively safe if Musk wants a piece of the new NASA going back to the Moon initiative (assuming it survives Trumps presidency).

I thought both the Air Force & NASA wanted new boosters on their flights, or in the case of NASA their manned flights, for the time being.

Online eeergo

Re: SpaceX reducing workforce by at least 10 percent
« Reply #57 on: 01/12/2019 12:13 pm »
That doesn't seem particularly harsh or dooming for a company in today's climate. I say this while agreeing with what Star One's comment above suggests, that doesn't mean it's fair or even advisable for the well-being of a company in the long term.

(By the way, folks should probably guess before posting Roman army tactics as an advisable method of XXI-century company management that labor laws (quite flexible in the US) are in place because there have been battles fought and lessons learned in the last 200 years of Industrial Revolution).

Not so sure it isn't harsh, or ill-advised, for a company like SpaceX, especially when most of the staff is clearly grossly overworked --even if that's considered to be a thriving ground for some--.

There's in my view a big disconnect in how people do accounting here. How much does a SpaceX worker cost annually, taking into account benefits and gross pay, less than $200k (probably quite less for a lot of technicians)? Considering a layoff of 700 people, you're saving at most $140M. That's surely a lot of money, but it's about 2 annual launch contracts at F9 prices, or a few lost cores on return. These laid-off people, or a sizable subset of them, are not able to contribute anything to that end?

The annual career, lifestyle and potential contribution of 4-5 highly-specialized and -performing workers is worth the fairings that were chosen to be dumped in the ocean in yesterday's launch, because of a few days' bad weather - let's reflect about that.

Then, there's the obvious elephant(s?) in the room that IMHO many are glossing over while obsessing over some technical minutiae:

- F9-R is mature and profitable, most technical wrinkles should have been ironed out by now, reusability as a business model probably is mature and profitable too. Despite this, SpaceX is reducing launches this year.

- There are alleged funding problems. Maybe they have been dismissed by the company's executives (who would expect them to flat-out confirm them anyway, unless they were so severe as to be obvious?), but as they say "when the river makes sounds, it carries water".

- There's an alleged capital drain from SpaceX to not-so-successful (in great part because of not so many talented experienced personnel are in them) Musk companies, also with less-than-clear purposes. Probably nothing major or as strange as it sounds, but should be kept in mind.

- There's a lot (and then some) of insanely positive publicity for SpaceX that no other players enjoy, brought in by the merits in what they delivered, yes -- but also by their well-studied approach to keeping public expectations high, which obviously brings in capital.

- Starlink's business model is still very much up in the air, and we should remember what happened to the last company attempting something as revolutionary as this, even if backed by a USG giant.

- Finally, the largest elephant that almost doesn't fit the room, and maybe is being mistaken as a room's wall: the ultimate justification for all this, the Mars architecture (and purpose): it was very much an experimental, almost conceptual, "Skunk-work" understaffed project until a few months ago (completion of D2's development).
Now it is claimed to be the main focus of attention -- but it's obvious the technical design is very much in early development, having just been head-to-toe upended a few weeks ago.
Not to mention the only solid development it has to show is subscale developmental models of an extremely promising engine, which was nevertheless started many years ago when said architecture wasn't even defined. This, followed by animations of a complex system the likes of which was never even attempted anywhere before, a substandard developmental tank whose design was abandoned, and -yes, I'm sorry to put it this way but someone has to say it- an empty, shiny, cheaply-constructed look-at-me billboard Starship in the middle of a muddy field.

Maybe this layoff is just as inevitable and healthy (for SpaceX) as 2014's, and at that time there were also big looming grey clouds in the horizon which were blown away; or maybe this time is different - but there's some reading between the lines to be done.
« Last Edit: 01/12/2019 12:16 pm by eeergo »
-DaviD-

Offline philw1776

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #58 on: 01/12/2019 12:25 pm »
I'm sure Blue could find a home few of the exSpaceX employees, would mean moving across country.

Why would Blue want to hire people who got explicitly laid off for being in the bottom 10%?
As pointed out above, maybe they aren't bottom 10%. Maybe they were hired for CF work, or passive TPS, or maybe they work primarily on Dragon 1 builds, etc.

And on top of that, sometimes people are not the best performer because they are not a good fit with the team they are on or the company culture.

Well said.
I worked in high tech, computers & later in communications.  Got laid off twice.  Once from Viatron, a startup that folded suddenly.  Zero severance unlike the 8 weeks these SpaceX folks got.  The other time was from a big company RCA computer which announced it was exiting the computer business on the 11 o'clock news Friday night.  The story said they informed the employees at end of business that day but they did not.  I was there in the open office layout until 6:30PM that night.  Bought a newspaper the next (Saturday) morning to prove I hadn't hallucinated the news last night. 2 weeks severance.

Worse was later when I ran engineering for smaller firms.  I had to approve every person we'd let go.  Yes, there was some overdue severance of poor performers and people who just weren't adapted to the way we ran and others whose skill set was fixed and we no longer needed them.  Hated that part of small startup high tech.

I wish SpaceX's ex-employees good fortune in job hunting and hope that SpaceX can actually afford to develop StarLink & BFwhatever simultaneously as this year's launch market shrinks before hoped for revenue arrives.

.
« Last Edit: 01/12/2019 12:33 pm by philw1776 »

Offline Llian Rhydderch

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Re: SpaceX reducing workforce by at least 10 percent
« Reply #59 on: 01/12/2019 12:52 pm »
ULA has also done a number of repeated layoffs since 2014.

May 2015 “Mother’s Day Massacre”  https://forum.nasaspaceflight.com/index.php?topic=37586.0

where Tory Bruno had previously announced, in 2014, large layoffs as part of ULA restructuring: “Tory said last year during BE4 announcement that ULA work forced would be reduced by 30-50%.”


March 2016: “Tory Bruno to announce layoffs on 3/29” a longish thread on the major layoffs during 2016 at ULA. 
https://forum.nasaspaceflight.com/index.php?topic=39827.0


Also had this:  “ULA expects another 400 to 500 job cuts in 2017"

Companies employ people to accomplish ends, to build stuff or develop new stuff.  When the need for that output changes, and the people working on that stuff are not needed to produce the stuff, they don't typically, and they cannot sustainably, keep human resources on the payroll indefinitely.  Change comes along.  We live in a world of #dynamism.

« Last Edit: 01/12/2019 12:53 pm by Llian Rhydderch »
Re arguments from authority on NSF:  "no one is exempt from error, and errors of authority are usually the worst kind.  Taking your word for things without question is no different than a bracket design not being tested because the designer was an old hand."
"You would actually save yourself time and effort if you were to use evidence and logic to make your points instead of wrapping yourself in the royal mantle of authority.  The approach only works on sheep, not inquisitive, intelligent people."

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