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A self-help guide to entrepreneurial cluelessness… Everyone who has worked closely with other businesses for long enough has their own little section of the corporate Tales from the Crypt. As most can tell you the majority of problems escalate simply because they are not prevented, as the ‘Evil of Inaction’ makes most people ‘passive bystanders’ and as Plato already shared “the penalty good men pay for indifference to public affairs is to be ruled by evil men.”

Yet the more painful tales show that corporate disasters take a real effort. By all means, it does involve killing a living creature, or if one chooses to sound less like a ‘vitalist’, a complex adaptive system of systems. One of the more efficient ways to slowly kill a company is by outsourcing, which has become increasingly popular especially in areas where expertise is needed, but not readily available. With outsourcing you try to identify a part of the business that is not essential, such as a limb or an organ, and you then cut it out, sell it to another company and then rent back the result.

In the case of ICT, this means you take the spine, parts of the nervous system and some seemingly non-vital bits of the brain, everything that has to do with the flow of information in your company, and you hire a small legion of legal surgeons to have it removed… and after a little sweat, bloodletting and tooth grinding you’re in a situation where you can rent back your prosthetic spine 2.0. Like practically any corporate chief, the rise of ICT related costs during the last two decades has created a strong aversion. It wasn’t so much all the streamlining so that you now can do the same work with one-fifth of the people, the advantages of de-duplication and reuse, and it wasn’t so much the value added and the new business avenues created… It was the ongoing complaining and whining of your middle management and your financial right hand man, your own wonder doctor who could shuffle around numbers so that your company’s board and shareholders would be satisfied for another quarter of a year. And that computer guy on the 2nd flour, with his quasi-provoking T-shirts, orthopedic sandals and silent self-satisfied smirk… What does he really know anyway?

So, after you’ve read Heavens knows how many articles in a variety of management magazines about the merits of outsourcing, you put aside the obvious detail that these are for the most sponsored advertising and astroturf which have degraded a once trusted journal to little more than the miracle cure claims in a Fortean Times. You say to yourself that you have to focus on ‘core business’ and that it is in the best interest of your technical people, that they will get the chance to develop in a larger company with more opportunities, and that in return you can benefit from all the new expertise that this larger company brings with it. It’s a win-win-win situation for everyone. Like with any sophisticated operation, you approach one the few surviving guild systems, unquestionably one of the Big Cipher firms, eventhough you know very well that the know-how and skill transfer is a bit upside down due to natural delays and buffering in the information flow. Once the textbook is written novelty has moved on, and you hope for the involvement of those talented few senior partners, who have both the skill and experience to really help you out. A little reluctant you accept they earn loads by prostituting their apprentice journeymen treating your company as part of their training program while these gents mature towards mastery and when they approach their forties they move into a convenient management position at some other large firm. The legal surgeons cost you an arm and a leg, but once they got going they cut and paste those spreadsheets like there was no tomorrow. With a thousand-page contract, not counting the supplements, these alphabet architects are surely worth their weight in gold. And as far as these kids go, that just adds ammo for negotiating a discount. And voila, onwards you go and for the next year or two it works out great. Enthusiasm and professionalism seem to have taken over what you once thought a defunct department. You have you own Account Manager at the large company, and a dedicated team made up of your former employees who appear to be doing a lot better now. Those bright talents you were afraid of that you couldn’t offer them enough challenges, you see them less and less as they move further into the larger company, and you genuinely feel good that you have offered them this chance. Even those guys that made you feel stupid as you couldn’t understand what they were trying to explain, while at the same time they didn’t seem able to turn it into meaningful business terms, even they seemed to have found a new home too and instead you got to deal with business analysts who at least talked your own language and they did the translating for you.

But then something unexpected happens and you need an extra favor, and it turns out that the thousand-page contract did not cover that. Problems never come alone, one thing led to another, crossing the boundaries of applications, platforms and organizations, going back and forth, and now it is not clear who was responsible for what happened and who needs to fix it in the scope of their service contract. You lost a whole week of business. You had it all sorted out, price tagged, the cost overview was clear and predictable, and maybe in some years you could apply the ‘laws of supply and demand’ to bring the ever rising costs of ICT down. And now it turns out that all you really had was a big ball of spaghetti eventhough you had ordered a plate of well-ordered independent pieces of macaroni. It turned out that the sauce made it all a sticky and gooey jumble, and that sauce was the information, control and resource flow of your actual business activities. It turned out that your new and improved prosthetic spine 2.0 was as much a part of your corporation as the old one, and you couldn’t really separate them in discrete parts them without losing meaning. Although you had still pictures of the company finances, retouched or not, the actual business itself was an event, an irreducible inseparable flow.

Somewhat halfhearted you start up a project to repair the damage, and after the third time decide to invest some additional resources in building up some internal expertise. Reusing the old labor contracts of the technical people you try to attract the best by offering them great secondary conditions, but trying to keep costs under control quickly the choice is made to focus on juniors, just a few years out of school. Grown up in the era of new technologies, they are supposed to be willing to put in the hours and they are easier to fit along with the company culture. You’ve learned about Generation Y and know you have to go for the geek and nerd but leave the dweeb and dork aside, and you’re somewhat surprised and happy to find out that most of the people interviewed are not significantly more freaky than most other colleagues. And so, within a year’s time, you’ve set up a little organization that mirrors the large company with your former employees. Your new people are somewhat ‘meta’, with roles like “enterprise architects” and “program managers”, functions that in the ICT world of a decade ago required innate skill and some 15, 20 years of experience: But these new guys are smart, they’ve grown up with these new technologies so they’ll grow into it, they can get training and get certifications for all kinds of methodological frameworks. Full of renewed vigor you carry on.

At a big group meeting another year later, looking back at the accomplishments and current status, you hired some 30, 40 people, trained them and this is the first full year of having your new team in place. After some misunderstanding you find out that the thousand-page contract didn’t involve formal performance reviews, with meaningful key-performance-indicators and due to the measurements that did exist there was no clear idea of what an actual baseline, what was “in scope” or “out of scope” of the service contract. When you try to discuss this with your former employees and your account manager, it turns out that they knew and have been trying to tell your people this all along but they were informed it was too costly to retrofit. But even more so, while talking with them you find out that during their years at the other company they have lost their involvement with your day-to-day business. They had lost their touch and forgotten their ways. Your own dedicated account team has grown alien and even those bright talents your hired back in the day, who used to come up with some really good ideas now you look back on it, have move on already.

Your factory is automated. Your administration is automated. You realize you have become a customer of your own business. It wasn’t so much ‘eating your own dog food’ but you have not only lost important skills on a part of your business that is now recognized as indistinguishable of your core business. But you also lost control and opportunities as ICT became more and more important. You have found that the parts of your business that have been growing throughout the years have been possible because of ICT, your company has been shifting from a product-focus to managed services and knowledge engineering, and this deeper form of client engagement has made you realize that this has been facilitated and enabled by ICT. Not just that, when the globalization tsunami hit it become clear that technological progress is accelerating to an extend where time cycles follow each other at such a rapid pace that it is best to start arranging your company as if you’re dealing with computer software. You come to the painful realization that you have been fighting the very thing that liberates you. You broke the chain of experience and had descended along a downward spiral as your own subject matter experts turned into negotiators whose only value comes from cost reduction…

But two can play that game. Hey, outsourcing doesn’t add any value anymore, but at least you can reduce the costs of failure. You attack on two fronts. Your own people will get to negotiate even harder. And they will adopt those new ‘agile’ methods where an artificial induced urgency ensures frequent micro-meetings which reduce the failure rate as misunderstanding is easily corrected and project planning is adjusted on an on-going basis. And consequently it will cost less. Embracing ‘the code is the documentation’ you bring in helping hands via international resourcing parasites whose only differentiating factors consist of fast and cheap, and like any temporary employment agency provide the unethical luxury of “deniable culpability”. Most of these resourcing and recruitment agencies, with their least-effort keyword matching and questionable sales skills somewhere between neuro-linguistic programming and verbal harassment, because they don’t have a clue whatsoever about the skills needed, provide non-committal liability, infidelity and a lack of due diligence. The unintended side effect of trying to avoid false negatives has reduced any utilitarian merit to circle the drain, spiraling down into an endlessly dull amorphous mediocrity. No professional ICT service provider can afford to offer senior skills at junior rates as experience has shown this completely skews the client’s expectations which in turn ruin mutual relations. If you pay peanuts, you get monkeys. For the price of one expert you can get two that are totally oblivious of what to do, eventhough the expert is about one or two orders of magnitude more efficient. And while your own people resort to cynicism and learned egotism, you finally recognize this is how unfamiliarity leads to overconfidence which leads to misjudgment which leads to ignorance which leads to incompetence which leads to mediocrity and forcefully filters out the talented. You finally understand how you and just about everybody else have been suffocating the emergence of the middle class of the information age, the techies, engineers, craftsmen and artisans.

You’ve underestimating your own responsibility, involvement and willingness. You realize the severity of inadequate relationship management, change control, contract management, of risk management at the expense of opportunities, how recurrent cost savings have created a sense of illusionary proficiency. You already had your initial cost saving and a big business opportunity on top of that, and all the later cost cutting has only resulted in auto-cannibalistic self-mutilation without much purpose beside the self-fulfilling idea of the ‘laws of supply and demand’ which were supposed to have an entirely different results. You finally learned that it is very difficult to get to a set of common metrics so to at least understand one another, that powerful metrics need to be aligned with a company’s initiatives, being both strategic as well as focused on the tactical day-to-day business. Eventhough you know that finding the right persons for the job is the main bottleneck, and the right mix of skills is rare and expensive, you also see the impact of ICT on both the existing organization and new operating models. So you agree that maturing such architectural skillsets, especially when aligned with other stakeholders, can rewrite the future of your company.

And you go for a deeper engagement. All it took was being a little more personal, like you always wanted you could, with your employees as partners, with management without managers. All it needed was a little humanity, just like you always wanted things to be and why you resented ICT so much as you had seen what gradual effects automation has had on manual tasks, and now on mental tasks. It was supposed to support people, not lock them inside a machine. You want to be the parent that your kids can be proud of, one that helped to mold centuries of scientific and technological advances to be used for the benefit of human beings and not for their degradation. You want this now. And so you choose for that one solution like you wanted to ten years ago… You choose for the big bang “turnaround”, engaging that one of a few rare companies that has this solution that does it all. That company that always was there, open and engaging, welcoming you with coffee and donuts. That company with that one solution that gives Enterprise Resource Planning for your financial people, Customer Relationship Management for your sales folk and Product Lifecycle Management for your engineers, and so much more. And so you engage on a path with corporate yes men who incidentally happen to have forgotten to tell that your three-year project will translate in another ten to fifteen years of guaranteed work for them… if your company lasts that long…

Originally posted to Paul Peters on Sat Aug 09, 2014 at 08:51 AM PDT.

Also republished by Community Spotlight.

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