Comments on: Valve: a bossless company with centralized ownership

By: Michel Bauwens

Michel Bauwens — Sun, 12 Aug 2012 04:08:01 +0000

Hi Sam, the rationale as described by the founder:

The rationale:

“When he looked into the history of the organization, he found that hierarchical management had been invented for military purposes, where it was perfectly suited to getting 1,000 men to march over a hill to get shot at. When the Industrial Revolution came along, hierarchical management was again a good fit, since the objective was to treat each person as a component, doing exactly the same thing over and over.

If most of the value is now in the initial creative act, there’s little benefit to traditional hierarchical organization that’s designed to deliver the same thing over and over, making only incremental changes over time. What matters is being first and bootstrapping your product into a positive feedback spiral with a constant stream of creative innovation. Hierarchical management doesn’t help with that, because it bottlenecks innovation through the people at the top of the hierarchy, and there’s no reason to expect that those people would be particularly creative about coming up with new products that are dramatically different from existing ones – quite the opposite, in fact. So Valve was designed as a company that would attract the sort of people capable of taking the initial creative step, leave them free to do creative work, and make them want to stay. Consequently, Valve has no formal management or hierarchy at all.” (http://blogs.valvesoftware.com/abrash/valve-how-i-got-here-what-its-like-and-what-im-doing-2/)

By: Michel Bauwens

Michel Bauwens — Sat, 11 Aug 2012 04:57:46 +0000

yes you are right Daryl. I will see how to change that formulation, which can be construed as misprepresenting Yanos’ view.

By: Sam Rose

Sam Rose — Fri, 10 Aug 2012 17:05:41 +0000

I guess my first question is this:

Why? Why a decentralized management with centralized ownership? Is it an experiment to prove it can be done? Is there some imagined or hypothesized advantage to this arrangement?

In particular: the question I have is: why did the owners of the company agree to go this route? (not so much why do people want to work for a boss-less p2p managed company)

What people are doing can be best understood through the lens of why they are doing it.

By: Darryl McAdams

Darryl McAdams — Fri, 10 Aug 2012 13:24:22 +0000

Sorry, that should say “Varoufakis is not talking about Valve …”

By: Darryl McAdams

Darryl McAdams — Fri, 10 Aug 2012 13:23:46 +0000

Again, I am not disputing the nature of Valve. What I am disputing is this:

“Yanis Varoufakis on Valve as a new type of bossless capitalist firm:”

This is false. Varoufakis talking about Valve as a new type of bossless capitalist firm.

By: Michel Bauwens

Michel Bauwens — Fri, 10 Aug 2012 06:04:40 +0000

the key is to understand the difference between what I say, and I then quote what he says, which means we have a different interpretation …

my understanding is this, you can be a non-capitalist coop functioning in a capitalist company

but given the private ownership, Valve is in my opinion a capitalist company, operating in the capitalist market, but using non-capitalist work allocation methods, and perhaps even more and other non-capitalist methods as well

I could be wrong of course, but nothing in what I’ve read from yanos so far, suggests that valve is essentially non-capitalist, rather than just having non-capitalist elements

all of this is of course partly definitional: I define capitalism as based on commodities, including labor, private property and geared towards capital accumulation,

Michel

By: Darryl McAdams

Darryl McAdams — Thu, 09 Aug 2012 19:45:47 +0000

While I would basically agree, Michel, that’s not the point. Whether or not we observers think Valve is capitalist or not is irrelevant. Valve’s own economist *said that Valve is not capitalist* and yet you say that he says otherwise. Varoufakis said Valve is *not* capitalist. He might be wrong, but that’s what he said.

By: Michel Bauwens

Michel Bauwens — Thu, 09 Aug 2012 13:04:40 +0000

I have no more details so far than the above. But what I understand from my reading is that Valve completely functions within the capitalist economy and accumulates capital for its owners, despite the fact that there is peer-based allocation of income.

By: AFC

AFC — Sun, 05 Aug 2012 11:52:45 +0000

“In contrast, co-ops and Valve feature peer-based systems for determining the distribution of a firm’s surplus among employees.”

Am I missing something? How is pay allocated at Valve? The article spends a whole paragraph describing how corporations work (thanks, I already knew), but just this one enigmatic line about how Valve is different…

By: Darryl McAdams

Darryl McAdams — Sun, 05 Aug 2012 06:51:24 +0000

I find it interesting, and a bit paradoxical, that you say this:

> Yanis Varoufakis on Valve as a new type of bossless capitalist firm:

and then immediately quote Varoufakis saying this:

> There are two kinds of non-capitalist firms:
> …
> (b) Valve (or similar companies) where management is completely horizonta
> (i.e. the company is boss-less) even if ownership is held in the hands of a selected few.

At multiple places in the article, Varoufakis stresses that Valve’s internal structure is *not* capitalist, and once he even states that it’s anarcho-syndicalist. You quote him in one such instance here.

How, then, can you say that Valve is a capitalist firm?