Coasean notes

I’m well over two and a half years into my current job, easily making this my longest unbroken spell of employment ever. This is a random set of pertinent observations, more a set of notes to myself rather than for any reader, regarding how the job has been playing out.

• The Nature of The Firm is real. For nine years, as a consultant, I enjoyed market pricing (adjusting for illiquidity and and other distortions) for all the work that I did, but also suffered from the transaction costs that Coase writes about in his famous paper.

  This meant that unless the work was reasonably well defined, or of a certain minimum size, I wouldn’t take it up – the transaction costs involved in doing the deal would far outweigh any benefits that my counterparty and I would achieve from the deal. This meant I added less value than I could have to my clients

• “Going deep” has its benefits. If I look at some of the work that I’ve done in the last few months here, and compared that to my work in my first year here, there is an absolutely marked difference. The difference is the two years of compounded extreme domain knowledge (about the company and its business).

  From that perspective, consulting can sometimes suffer from a limitation of domain knowledge

• Countering the above point is that I’ve “been internalised” after two plus years here. The things that excited me at the time I joined don’t excite me any more. There are times when I get what I think are interesting insights, and then just don’t bother about showing them to anyone, based on the historical reaction to such insights.

  A fresh consultant, on the other hand, would share more, and would thus get more done

• The biggest advantage of being “in house” is the data – I have access to pretty much ALL data in the company, and if I don’t have access to something, there is a good chance that the data doesn’t exist. This means I’m able to craft better hypotheses and do better analysis, compared to the time when I relied on clients to share specific datasets with me (pretty much nobody opened up full live access to their database to me)
• In a way I also miss the novelty of being a consultant – because you work with a company for a short period of time, you are bringing in new ideas and insights in that period of time, and people pay you attention for it. As an in-house employee, you become a part of the furniture. And a lot of the time, it is a good thing if nobody notices you
• Lack of friction in terms of taking up work means average quality of work can suffer. If you are very particular about the kind of work you want to do, it’s good if you can be a consultant – the friction means it’s easier to say no there.
• As a consultant, by definition, I was a “hybrid worker”, working by myself for long periods of time and then visiting the client for meetings and discussions. That had worked out brilliantly well for me.

  However, I realise “that hybrid” is different from “this hybrid” (the job), since here people have access to my calendar and are able to schedule meetings even at times when I’m not in office. Rather, since my company has a multiple-headquarter setup, I even prefer to take meetings with colleagues not in Bangalore on days when I’m at home.

• The biggest difference between monogamy (one employer) and polyamory (two or more “clients”) is that in the latter, no one owns your time. Because they know that they are “one of several” (even if at some point in time they are “one of one” it doesn’t matter, since that’s a special case), they can’t take your time for granted. And that gives you immensely more control over your time.

  This was possibly the hardest part for me getting back to a full time job – the lack of control over my time since I had now sold ALL of it to one company.

• The flip side of this is that, at least for someone like me, not having to keep selling myself constantly is a brilliant feeling. Though, there is some amount of “within the company selling” that has to happen from time to time.
• Apart from control over my time, the thing I miss the most about my consulting life are the “semi work meetings” – these are meetings with prospective clients, people who can lead you to prospective clients, old clients, etc. Where there is a tinge of work to the meeting, but you also catch up on several other things.

  Now that I’m in a job, and one that is entirely internal facing, there is no concept of “pseudo work meetings”. It is either proper work meetings (or “water cooler conversations”) with colleagues, or proper socialisation with others. That means I’m meeting far fewer people on average, nowadays

• I admit that having become a sort of a “company man“, I’ve started taking myself more seriously than I would like to. Of late I’ve started making a conscious effort to dial this back a little bit, and I think it’s already making me happier.
• Oh, and game theory rocks. Not a day goes by without me thinking about “saama daana bhEda danDa“

I can go on and on and on, but I think this is enough for now. If I have more, I’ll write another post.