CTOnews.com, December 17 (Xinhua) in recent years, Nvidia's share price has soared, and the company's employees have reaped handsome returns. However, an unexpected problem arises: some senior employees, sitting on huge amounts of company stock, seem to be beginning to lie flat, lose their enthusiasm for work, and stop working as hard as they used to.
Tuyuan PexelsCTOnews.com noted that this issue has attracted the attention of Nvidia CEO Huang Renxun. At a staff meeting last month, he publicly responded to questions raised by employees about the existence of "semi-retired" veterans in the company. Huang Renxun said that working at Nvidia is like a "voluntary sport" and everyone should manage their time like "CEO". He admits that some employees have been working at the company for a long time. These are the judgments that adults should make, he added. His core message is that while everyone should decide how hard they work, they should do the work responsibly.
Many Nvidia employees have seen the company's share price rise by 1200% over the past five years and become rich overnight. However, this unexpected success has also brought unexpected side effects: growing tensions among employees, and some employees believe that older employees are not doing their best.
Nvidia employees almost piously support Huang Renxun and appreciate his practice of putting "human values" at the core of the company's culture. According to Glassdoor, Huang Renxun's CEO approval rating is 98%, far higher than the CEO of companies such as Alphabet (81%), Amazon (69%) and Meta (54%).
However, employees also blame the excessive employee-centric culture created by Huang Renxun, coupled with a relatively lax management style and the company's new dominance in the high-end chip market, which exacerbate the flattening phenomenon.
"Huang Renxun's meaning is very clear, that is,'do your job well,'" a source said.
Almost every technology company faces a similar problem at some stage, that is, experienced employees are familiar with the way the company works, and can even be said to be "dawdling". There is a word in Silicon Valley called "rest and vest" to describe employees who don't have to do much work to get paid and wait for stock options to expire.
But at Nvidia, the company's "pro-employee" culture further exacerbates this behavior. For example, Nvidia has never made large-scale layoffs in its history, and even during turbulent periods such as the COVID-19 epidemic in 2020 and the cryptocurrency crash in 2022, Huang Renxun repeatedly assured employees that there would be no layoffs. The company's last formal layoff dates back to the 2008 financial crisis, 15 years ago.
According to the source, executives took the initiative to cut their salaries during that difficult period to reduce the impact on ordinary employees. One employee said that when Nvidia's share price fell in 2022, they received additional stock awards to make up for the drop in pay.
Unlike competitors such as Amazon, Nvidia rarely includes employees in performance improvement plans. Employees say that if someone does not perform well, the company will try to find a new team for them, rather than directly include them in the mentoring program or fire them. It is reported that Huang Renxun said publicly at the regular plenary meeting that he hoped not to dismiss anyone.
Although this culture fosters employee loyalty, it inevitably breeds laziness and speculation. As one employee said, "it's harder to be fired here than to be hired."
Moreover, there is no reason for employees to resign at the moment. CEO Jim Herd of Herd Freed Hartz, a headhunter, says that in his experience, Nvidia has a lower turnover rate than other technology companies. Nvidia has built a "very strong culture" to increase employee satisfaction, he says, and they have no incentive to look for other jobs at all.
In addition to the company culture, Nvidia's near-monopoly position in the chip market has also intensified the "flat" tendency of employees. This year, Nvidia's GPU chip has become one of the hottest products in the technology world and is the backbone of many generative AI services such as ChatGPT. This popularity makes the jobs of some Nvidia employees easier. One employee said Nvidia now has more bargaining chips with customers than ever before, as cloud service providers and artificial intelligence companies are eager to acquire their GPU chips. Potential customers are scrambling to answer their calls, and existing customers are willing to pay more for Nvidia's technology, a dramatic change from last year.
There are signs of this change in Nvidia's latest financial report. In the third quarter of 2023 (August to October), Nvidia's revenue reached $18.1 billion, up 207% from a year earlier, compared with $5.9 billion in the same period last year. This growth is almost natural, with operating expenses (R & D and marketing) rising by only 15 per cent ($3 billion this year and $2.6 billion last year).
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