Beware the new Corporatopia

By Sean Anderson on August 31st, 2012

In 1946, Merle Travis famously lamented:

You load sixteen tons, what do you get
Another day older and deeper in debt
Saint Peter don’t you call me ’cause I can’t go
I owe my soul to the company store.

At their peak, company towns in the US housed 3 per cent of the population. Most often they took the form of dingy gulags. In many cases, they implemented policies whereby workers could only buy goods at the company store. Because the corporation had a monopoly, it could set unreasonably high rates on goods, leading to a life of indebtedness for workers.

Employees were paid badly in exchange for the benefits of housing, utilities and food. These “truck systems” were cracked down upon in western countries, and it is hard to find their like today even in emerging economies. Still, it’s worth making a comparison with China’s colossal Foxconn City. As a huge, corporation-managed dwelling, hundreds of thousands of people work and largely live at the factory.

Technology companies have, so far, not attempted to build modern takes on the company towns of yore, but they are starting to intrude on lives of their workers, and big projects are on the horizon. Employees are now expected to devote their entire lives to the job, buying into not only their career but the company’s philosophies and ideologies.

Consider the Valve handbook, which leaked earlier this year. The company has a “flat” hierarchy in which employees are encouraged to move around and find projects to work on, rather than having tasks assigned to them by a superior. Any employee can start their own project if they can find people to work on it, and employees are ranked through a complex, democratic process by other staff. This rank determines their pay.

The Valve philosophy is even tangible: desks are on wheels, with staff encouraged to move them around on a semi-regular basis. Occasionally, the firm charters a plane and the staff goes off on holiday somewhere together. This is great for a creative team of highly dedicated types, but the average developer might not fancy it. Shockingly, they might even want a traditional biological family rather than the company variety.

Image: the Valve Handbook

Valve is a relatively innocent example: a creative philosophy applied to a video games company. But this kind of atmosphere took a catastrophic twist in the case of Enron, which cultivated a macho, risk-taking culture, coupled with an unswerving faith in its leaders’ superhuman capabilities. In the book and film Enron: the Smartest Guys in the Room, former employees of the company talked about how they “took Jeff Skilling and Ken Lay’s belief in free markets and turned it into an ideology”.

What started as a relatively simple energy trading scheme turned into a culture and then into a cult. These “former nerds” bought into their own hype, with consequences that rocked the American economy. The upper echelons of the company did extreme sports together. Executives went as far as physically altering their bodies to fit in. One employee recalls: “When Jeff got LASIK on his eyes, everybody at Enron got LASIK, so nobody was wearing glasses.”

When a company’s culture becomes this introspective, the consequences can be ugly.

Technology companies are insisting on greater oversight of the life – and even death – of their workers. Earlier this month, it was announced that Google is to offer its employees “death benefits”, through which a surviving domestic partner will receive half of the deceased worker’s salary for ten years after their death – plus stocks and $1,000 per month for every child until the age of 19 (or 23 if the child goes into full-time education).

This benefit is available from day one of employment at Google, so it’s not just a benefit to tenured executives. “You know what’s next? Company town!” was the conclusion from veteran industry commentator John C Dvorak.

Image: Downtown Project

Though fringe benefits have long been on offer at large companies, they are now crucial draws in a global market of workers. The recent spate of utopian projects from the likes of Downtown Project from Zappos founder Tony Hsieh are a new breed. It has become customary in the tech industry to offer things like sleeping pods. Of course, they are cunningly branded as relaxation pods: if sleeping at work was to become de rigeur, it would raise regulatory and cultural problems.

This betrays a certain attitude towards staff that we might find worrying. Sleep at work, eat at work, and the company will take care of you from your first day to the grave.

Google’s well-known provision of free food on its campuses is an interesting example. Healthy food is free, but items from the vending machine are priced according to healthiness. One cent per gram of sugar, two cents per gram of fat, four cents per gram of saturated fat, and one dollar per gram of trans fat.

In one sense, it’s an amicable intrusion. Everyone should probably eat healthily anyway, and it’s great that Google cares. Still, another step into the private life of workers has been taken. Companies are assuming the moral authority to incentivise or disincentivise employees about what they put into their bodies.

There’s a word for that. It’s called paternalism. Weak though the forces may be, employees at a corporation being subject to incentives toward or away from certain kinds of consumption isn’t a route a lot of free-thinking developers and creative types will want to buy into. Yet, sleeping on the floor or on several stacked chairs and participating in a group mantra seems to be necessary to start-up and corporate success in much of the tech world.

It’s treated as a joke or curiosity, but it should be a cause for shame. When Apple engineers retreat into their new campus, chances are it will be to a very isolated and rarefied world of Apple’s own making. Apple devices are built to solve real-world problems, but their designers will struggle to achieve a popular success like the iPhone from a remote torus-shaped nightmare straight out of Isaac Asimov.

Image: A rendering of Apple’s new campus

When you join a company you may be doing it for the salary, the location or the type of work. What not all employees necessarily want to do is buy into an entirely new way of life. Such homogeneous corporate environments stunt diversity, attracting only a limited subset of potential hires. No mantra, no entry.

Employees should resist the utopian, ideological scheming of their corporations.