Nvidia's success is making some now-wealthy employees complacent

[midian182]

In brief: Is it possible for a company to be too successful and overly caring when it comes to employee well-being? It sounds strange, but that's the unusual position Nvidia finds itself in, with many long-term workers watching the value of their stock increase as they coast along in "semi-retirement" mode.

Nvidia's stock has increased around 1,200% over the last five years. That's great news for long-term employees whose compensation is partly made up of company stock, but sitting on a fortune has been making some of these workers complacent. The situation has been annoying other Nvidia staff to the point where it was brought up during an internal all-hands meeting with CEO Jensen Huang.

As reported by Business Insider, which spoke to people who attended the meeting, Huang answered the question about veteran employees not pulling their weight by saying working at Nvidia is like a "voluntary sport," and every employee should act like the "CEO" of their own time. He added that each person should determine their level of work as these are judgment calls to be made by adults.

"Jensen's making a serious point, which is 'do your damn job,'" one of those present told the publication.

Nvidia has benefited more than most from the generative AI boom. Sales of its data center GPUs and related AI products have pushed Team Green's market cap to $1.19 trillion, and while that's good for the company, it has reportedly led to tension between workers and long-time staff who are just coasting until their stock awards vest – sitting on a million dollars worth of stock isn't a good motivator to work extra hard.

Another issue is the lack of competition Nvidia is facing right now. Massive demand for its AI chips means some employees don't feel the need to work so intensely. "We have no competition," one of the people said. "But we're slowly getting bloated. There are these guys who don't do anything."

No CEO is as beloved by their employees as much as Huang. He topped the most popular CEO survey in October with an approval rate of 96%, 8% higher than second-place Walmart boss Doug McMillon. Huang's popularity is helped by his reluctance to implement layoffs. In the summer of last year, back when Nvidia missed earnings expectations and the economy was even worse, Huang assured employees there would be raises, not layoffs, at the company. The last formal job cuts the company made were during the 2008 financial crisis.

While this sort of behavior inspires loyalty for a boss and improves employee happiness, it can introduce unforeseen problems. "It's harder to get fired than hired here," one of the people said.

Some long-term Nvidia staff might be getting lazy as a result of the company's success, but Huang certainly isn't taking his foot off the pedal. He recently admitted that he constantly worries that the company will one day fail – Nvidia came close to bankruptcy more than once in the past.

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https://www.techspot.com/news/101218-nvidia-success-making-now-wealthy-employees-complacent.html

 

[Uncle Al]

Yeah, companies should look out for this and remove those that are not willing to be productive; if for no other reason than to remain compedative.

 

[OortCloud]

The real tragedy in all this is that AMD has made so little effort to out-compete nVidia in the last couple of years.
All they have done is look at the lukewarm-at-best products with some crazy pricing and got greedy by offering similar alternatives at largely similar prices.

 

[d5aqoep]

The curse of 100 million gamers is on Nvidia who had to buy not only overpriced but also VRAM deficient cards since 30x0 and 40x0 series.

 

[VaRmeNsI]

The real tragedy in all this is that AMD has made so little effort to out-compete nVidia in the last couple of years.
All they have done is look at the lukewarm-at-best products with some crazy pricing and got greedy by offering similar alternatives at largely similar prices.

ATI at least attempted to compete, only stagnated since AMD took over.

 

[redgarl]

ATI at least attempted to compete, only stagnated since AMD took over.

Yeah yeah yeah... if AMD didn`t bought ATI, they would not be competing with Nvidia in the AI space. And all the APUs for mobile... You are missing the big picture.

Not only this, but the MI300 is the most impressive SOC ever made. Nvidia is not even close to accomplish something similar. AMD has a 5 year head start over Nvidia on chiplets and SOC.

 

[Theinsanegamer]

Yeah yeah yeah... if AMD didn`t bought ATI, they would not be competing with Nvidia in the AI space. And all the APUs for mobile... You are missing the big picture.

Not only this, but the MI300 is the most impressive SOC ever made. Nvidia is not even close to accomplish something similar. AMD has a 5 year head start over Nvidia on chiplets and SOC.

ATI fell behind in the 2010s largely because AMD was sucking up every Radeon dollar they could to prop up their worthless CPU division. AMD hurt ATi, badly, for well over a decade after their acquisition.

The big picture is that those APUs only hold about 15-20% of the laptop market, after all these years. MI300 is impressive because it competes against nvidia, something AMD has failed to do in the commercial space since the late 2000s.

 

[kira setsu]

I will never understand american capitalism and I f***in live here.

I don't get this article at all, the employees did their job right? they created or helped in some way with the creation of products that are best in class, bring in crazy money and can't be beaten.

So now they're lazy? seems to me they won the game, isn't their fault amd, intel and whoever else can't make anything on that level, imho it seems nvidia's crew worked so hard that they kinda deserve to rest and take a victory lap, They won.

 

[Theinsanegamer]

I will never understand american capitalism and I f***in live here.

I don't get this article at all, the employees did their job right? they created or helped in some way with the creation of products that are best in class, bring in crazy money and can't be beaten.

So now they're lazy? seems to me they won the game, isn't their fault amd, intel and whoever else can't make anything on that level, imho it seems nvidia's crew worked so hard that they kinda deserve to rest and take a victory lap, They won.

This attitude always mystifies me. Nvidia is in a very competitive industry. If you stop working for a "victory lap", you proceed to fall behind. And it can take years to fix that. This has been demonstrated, numerous times, in the GPU industry, and the Pc industry in general.

But I suppose if you see this problem as "capitalism" then history wouldnt really matter.

 

[HardReset]

The big picture is that those APUs only hold about 15-20% of the laptop market, after all these years. MI300 is impressive because it competes against nvidia, something AMD has failed to do in the commercial space since the late 2000s.

Market share has nothing to do with product quality.

 

[trparky]

If you stop working for a "victory lap", you proceed to fall behind. And it can take years to fix that.

Case in point... Intel.

Intel sat on their laurels for years because... What were you going to buy? AMD? LOL

That kind of thinking worked back when AMD was on the rocks, swirling the drain, etc. But that all came to an abrupt end when AMD came out with Ryzen. Sure, Ryzen was buggy at first but now it's a class leading product that's allowed for AMD to take a good portion of the market and so far, Intel has had nothing to counteract it other than chips that consume hideous amounts of power and can double as a space heater in the winter.

 

[kira setsu]

This attitude always mystifies me. Nvidia is in a very competitive industry. If you stop working for a "victory lap", you proceed to fall behind. And it can take years to fix that. This has been demonstrated, numerous times, in the GPU industry, and the Pc industry in general.

But I suppose if you see this problem as "capitalism" then history wouldnt really matter.

For Nvidia they can legit pat themselves on the back and not worry about being caught, and that seems to be what they're doing, pushing forward while acknowledging that they're the best in the pack.

the article comes off in a very salty way imho,

 

[VaRmeNsI]

Yeah yeah yeah... if AMD didn`t bought ATI, they would not be competing with Nvidia in the AI space. And all the APUs for mobile... You are missing the big picture.

Not only this, but the MI300 is the most impressive SOC ever made. Nvidia is not even close to accomplish something similar. AMD has a 5 year head start over Nvidia on chiplets and SOC.

I just simply stated an observation, not saying it would have been necessarily better if they had not bought them. In the consumer space they have been consistently behind Nvidia since the takeover.

Perhaps Intel will succeed where AMD have failed.

 

[HardReset]

I just simply stated an observation, not saying it would have been necessarily better if they had not bought them. In the consumer space they have been consistently behind Nvidia since the takeover.

Perhaps Intel will succeed where AMD have failed.

That's just BS. GTX 480 can be considered dismal failure against AMD products. That's 2010 product. AMD bought ATI 2006.

People bought Nvidia even when AMD was clearly better and after that same people complain about lack of fast AMD GPUs ""

 

[p51d007]

It happens in a lot of corporate situations.
I remember in the 70's, you would see Xerox ads all over tv..."it's just as good as a Xerox".
The were the kings of the photocopier world. Then Canon, Ricoh, Sharp came along with better
products. Now, you hardly see Xerox machines except in large print shops and what not.
Car industry. After WW2, the American auto industry pretty much had everything. Then, the "oil crisis"
started and the Japanese flooded the market with small cars with better milage.
Sometimes, once a company reaches the top, they give up on innovation. Smartphone market is kind
of at that point now, but, sheep keep buying more and more expensive devices, that only offer brighter
screens, more speed/memory. Except for the overpriced folding phones, they really haven't changed.

 

[GodisanAtheist]

This attitude always mystifies me. Nvidia is in a very competitive industry. If you stop working for a "victory lap", you proceed to fall behind. And it can take years to fix that. This has been demonstrated, numerous times, in the GPU industry, and the Pc industry in general.

But I suppose if you see this problem as "capitalism" then history wouldnt really matter.

- Why does the invisible hand of the market suddenly not matter when it comes to employee compensation? NVIDIA compensated these employees with stock in the company, personally vesting them in the company's success.

Company is successful, in some part due to speculative investment, and the unforseen consequence is now these employees don't feel the motivation to work because the work they put in made them rich.

Maybe don't compensate employees with stock, do profit sharing based on quarterly income or something else to keep them consistently motivated but also fairly compensated.

Compensate with stock, an income stream that you don't control as the employer, and lo you may lose control of your workforce.

 

[VaRmeNsI]

That's just BS. GTX 480 can be considered dismal failure against AMD products. That's 2010 product. AMD bought ATI 2006.

People bought Nvidia even when AMD was clearly better and after that same people complain about lack of fast AMD GPUs ""

So 13 years ago...

 

[HardReset]

So 13 years ago...

And? People made it clear they don't care if AMD has clearly better product. Development costs money. With limited resources, around 2012 AMD had to choose: either to invest heavily on CPU or on GPU. Since better GPU clearly do not mean good sales, AMD choose to invest on CPU. We all know how that CPU investment paid off.

 

[Watzupken]

This is a common problem, company don't pay well, people will complain. When company pays well, people will also complain. So honestly, you just can't please everyone. To me, these people are complaining in this article because they are not getting as much as they want, or just comparing too much.

 

[Watzupken]

The real tragedy in all this is that AMD has made so little effort to out-compete nVidia in the last couple of years.
All they have done is look at the lukewarm-at-best products with some crazy pricing and got greedy by offering similar alternatives at largely similar prices.

In my opinion, it is very easy to say something. But you probably know that it is very tricky to execute. You don't have to look far to figure that AMD almost went bust before they got "revived" when they released their first Ryzen processor. While they have been making inroads and profit, they don't have infinite budget like the US government to fight a war on both ends (Intel and Nvidia) which are both larger than AMD. With their primary success in CPU, and likely also likely due to lower cost of producing cutting edge CPUs (than GPUs), it makes a lot of sense they put their main priority on CPUs. I don't think they dropped the ball here, but rather a calculated decision due to limited resources to compete.

 

[Watzupken]

I just simply stated an observation, not saying it would have been necessarily better if they had not bought them. In the consumer space they have been consistently behind Nvidia since the takeover.

Perhaps Intel will succeed where AMD have failed.

You really think Intel is all in for the GPU market? Then where is the ARC refresh? And you barely hear anything related to Battlemage. I guess Intel's tactic is probably going to be no different from AMD here. Have GPUs good enough for iGPUs and can scale for custom SOCs, plus, focus on data center solutions. They will both produce some dedicated GPUs, but I am expecting them to focus less on the high end.

 

[poohbear]

Case in point... Intel.

Intel sat on their laurels for years because... What were you going to buy? AMD? LOL

That kind of thinking worked back when AMD was on the rocks, swirling the drain, etc. But that all came to an abrupt end when AMD came out with Ryzen. Sure, Ryzen was buggy at first but now it's a class leading product that's allowed for AMD to take a good portion of the market and so far, Intel has had nothing to counteract it other than chips that consume hideous amounts of power and can double as a space heater in the winter.

Yes but isn't that healthy? In 2010 if you said AMD would outsell and become a bigger company than Intel you would've been laughed out the room. Companies perform best when theyr're lean and hungry. When they get so big and become complacent, another company steps up and surpasses them. That's healthy in any market.

AMD under Lisa Su is an excellent company. When they focused on CPUs they surpassed the 500 pount Gorilla that was Intel because Intel was complacent...now that Nvidia is the 500 pound Gorilla and they're being complacent...I see Lisa Su surpassing Nvidia in GPUs one day...but the big difference is Jensen Huang is a machine! Under his leadership its hard to see Nvidia fall behind...but if he ever decides to retire from Nvidia, then we'll really see AMD surpass Nvidia.

 

[trparky]

Yes but isn't that healthy?

Some would say yes, but I don't. Complacency leads to lack of a competition. And don't sit there and think that if AMD were to somehow find itself in a situation in which Intel was where AMD once was, on the rocks, that they too would become just as complacent as Intel was back in the day.

Healthy competition breeds innovation, it pushes companies to strive to do better. And who wins? The consumer.