EMR Online

John D. Trudel
The Trudel Group

In my last column, I parsed possible employers for recent graduates into three groups. Group A were the "average" manufacturing companies, which account for most jobs and most layoffs. Group B were the monopolies and oligopolies, which are wealthy and account for the best jobs. Group C were the innovators, the upstarts who chase their dreams to create wealth.

During the 1990s, most markets evolved into battles between incumbents (Group B) and insurgents (Group C) [1]. In general, the upstarts won big. These insurgents produced triple-digit returns for their investors, the incumbents (Group B) delivered about 20-30% returns, while the traditional firms (Group A) profitably declined and many were acquired.

These were good times. Much wealth was created and new chapters were written in business and technology folklore by firms like Netscape, Amazon, and many others. Then came the "tech wreck." So now I give talks titled "Who Killed Dot Com?"

We don't have the space to discuss that, but IO will give you my conclusion: The script has been written for the next decade of business. That script is "The Empire Strikes Back." Not since the Spanish Inquisition have the incumbents been so systematic in quashing new ideas.

Much of the carnage was done by "time bombs from the 1990s" that turned the environment lethal. Thousands of firms collapsed, and virtually everyone in the technology sector was damaged. These time bombs were not physical, but legislative. Their impact continues.

During the late 1990s, Congress passed a series of bills to "help" technology. These bills had titles like The Inventor's Protection Act of 1999, The Telecom Act of 1996, and the most peculiar Digital Millennium Copyright Act (DMCA) [2]. The Patent Legislation sneaked through under "suspension of the rules" and was passed before copies were available for reading, despite an unprecedented plea from a quorum of Nobel laureates for "extensive debate" [3].

These bills were ambiguous and structured so that they not take full effect until after the last Presidential Election. Therefore, even today, few agree about their impact except that penalties are severe. It is now illegal (literally a felony, with possible prison terms) to even discuss copy protection issues publicly on any technical level [4]. Except for DMCA - which regulates technology, not copyrights - these are perhaps best understood by inverting their titles.

I think this decade will be tough for Group C, the innovators. The future is always unprovable, of course, but there is evidence that others "in the know" have drawn the same conclusion. Technology stocks have been pummeled. In past years, about half of Stanford's MBAs went to smaller firms, but in 2001, two-thirds will join firms of over 1,000 employees [5].

So, my suggestion is to target your career at Group B, if you can. Beyond that, you might do well to research whether your employer has imbedded procedures for selecting and training their best engineers and managers. That is the exception these days, but there is compelling evidence that organizations that select for and work to improve excellence, improve not just the best but also everyone else [6].

In general, this strategy is to work for the winners, and particularly for the winners who will invest to help you improve your skills and get the right experience. If you can't do that, your best bet is to pick either of the others and hope to be acquired by a Group B firm.

There is even a fourth choice, the public sector. Like the old Eastern Europe, this is actually starting to pay better than the private sector. In Oregon, the last time I looked, public sector jobs were paying 122%, on average, of the private sector. These may not always be the best jobs (consider the "postal" jokes!), but they usually offer the most security and the best benefits.

Whatever your choice, I wish you well. It is clear that the future holds a shortage of trained technologists; so understand that you are needed [7]. Live long and prosper, dear GOLD members.

Notes
[1] G. Hamel, Leading the Revolution, Boston, MA; Harvard Business School Press, 2000.
[2] Special Report, "The RIAA's low watermark," Wired, pp. 61-63, July 2001.
[3] J. D. Trudel, "The patent wars," Analog Science Fact and Fiction, pp. 52-61, Jan. 2000. Available: http://reactor-core.org/patent-wars.html
[4] Spectral Lines, "Talking about digital copyright," IEEE Spectr., p. 9, June 2001.
[5] "Cardinal numbers," Wired, p. 78, July 2001.
[6] See "Meeting of the minds," IEEE Eng. Manag. Rev., vol. 29, pp. 116-120, First Quarter, 2001. There was also a recent study from Harvard reported in the Wall Street Journal that drew the same conclusion for K12 educational methods.
[7] See http://www.stanford.edu/~promer.

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