I’ve been busy attending some conferences lately where I’ve had the chance to speak with IT pros across several industries.  What I found most interesting is that even amongst this diverse group there seems to be some common themes of interest and focus.  Sure, we spoke about cloud computing and virtualization, but at a higher level there were two underlying drivers to their strategies.

• There are no longer any secrets in Technology.
• Know the true value of IT.

There are no longer any secrets in Technology

This statement sounds odd at first.  However, when you really think about it there are none.  Your competitors have access to the same vendors and technology that you do.   How they effectively put them together might be a secret, but at the end of the day the access is the same. 

So what can you do to compete?  Speed.  How fast can you deliver to the market?  To put the pace of technology in prospective please play the video below:

The video is a few years old, but you get the trend.  Speed is of the essence.  So what do you need to do to be in a position to out ‘speed’ your competition?  Simplify your processes and your architecture.  These are perhaps two of the most taxing aspects of software development.  If you are not concentrating on streamlining these you’re probably not going to out flank the next ‘startup’ looking to capture your customer base.

Know the true value of IT

This one probably hits home to most IT folks who work in corporations.  You need to constantly justify your existence because someone will inevitably ask; What value does IT provide?  I think as a profession we commonly whip out ROI calculations on the projects we’ve completed or SLA’s that demonstrate our ability to meet some number that the business could ultimately care less about (show them that you have a 4 hour window when email goes out and see the reaction).  I hate to break it to you.  Meeting SLA’s and calculating ROI’s is not IT’s value prop.

IT’s value to the business is as an exponential transformational force that underpins all business activities.   It sounds a bit ‘Star Wars’, but let me prove it to you.

If you’re one of the fortunate souls that regularly has to calculate ROI’s for proposed projects you need to ask yourself the following question.  Three years from now will they come back and check to see if the ROI is realized?  If so who gets fired if it’s not?  I venture to guess that the answer for 99% of people is no, and no one.  Need more? Have you ever calculated that a new piece of software will automate X number of headcount?  When have you ever seen that headcount reduced or reassigned after delivery?  No, they just get to do more of the same thing, just more efficiently!

What you need to be looking at is how can you dramatically transform a market or a business process to give your company a competitive edge!  It sounds dramatic, but it’s really very simple. For example:  Why make the ‘order’ entry simpler so people can do more of it?  Why not focus on automation so you can reduce headcount and improve accuracy? 

I know what your thinking.  That should go into the ROI calculation for sure.  And you are correct.  However that is often what I see go wrong.  Too many times business leaders ask to make something simpler or ‘shinier’.  Our value as IT professionals is helping them realize exponential transformations by pointing out opportunities that they might not even think of.  That is the true value of IT!

Anyone who writes code is always interested in the capacity (or load) that their system can handle.  For some, including this author, it’s a matter of pride and bragging rights.  However, there is a different type of capacity that is normally overlooked.  When was the last time you estimated your team capacity?

Your team capacity is as equally as important as system capacity.  Team capacity determines how much work you’re getting done and, at the end of the day, how much value you’re giving to your customers.  I think that most folks automatically assume that their team capacity is some magical number calculated based on the number of people that work on the team multiplied by a ‘hours per week’ number.  Although this isn’t entirely incorrect you might be short changing yourself.

So to start, let’s talk about what factors go into team capacity planning.  There’s the obvious, availability of the team.  You can’t factor forty hours a week if your team is also dedicated to other tasks.  What about complexity of the tasks?  There are methodologies out there that can help you plan for that.  What’s missing from the equation?  Simple, budget, talent and infrastructure.  Let’s take a brief dive shall we?

Budget

Most projects have budget constraints.  However, you need to weigh your available budget with time.  I think most people think that if you have 5 FTE’s (Full-time employees) working for six months on a project and it takes up the entire budget you’re probably doing better than most.  What if you have 2 FTE’s and 3 contractors that complete the work in 4 months but still fit within your budget?  What about 2 FTE’s and 3 contractors and it still takes six months?   Is it worth it?  Now you have freed up 3 additional FTE’s!  You now have just added to your team capacity.  You actually end up retaining intellectual property because of your FTE’s, but get the work completed by augmentation.  The pitfall is that typically a contractor will always cost you more.  So you need to figure out what the difference is between time and cost in order to take advantage. 

Infrastructure

Infrastructure is the key to making budget and talent work.  When I talk about infrastructure I’m talking about your team’s ability to ramp up an outside resource.  You need to ask questions like:  How long does it take to setup our environment?  How long does it take for them to understand our architecture?  What software will they need to complete the work?  I’ve seen a lot of talent and budget wasted on this over the years.  If you want to increase team capacity you should focus on the ramp up.  And not just for augmentation, but for your own team as well.  Either way a solid infrastructure adds to your team capacity.

Talent

Talent is probably the most important aspect when considering team capacity.  I’ve spoken about budget and infrastructure.  However, if you don’t have the talent to manage ‘additional capacity’ then you might as well have stopped at paragraph one.  If you follow budget and infrastructure than you need someone to help you manage the additional ‘capacity’.  This is where you need to invest in the team.  Based on my experience, a good senior level technical person can manage three to four staff augmentations (read contractors).  Again, the benefit is that you keep the intellectual knowledge in-house, but increase capacity at the same time.

Conclusion

So what is your true team capacity?  By factoring in talent, budget and infrastructure you can dramatically raise your team’s ability to meet your goals.

I was having a discussion the other day about the fact that I often times come across as hopelessly optimistic at work.  Specifically the conversation centered around some recent work and project challenges my team was facing.  Members of my team felt that despite the outlook I always seem to have a misplaced positive attitude.  This lead to a great deal ribbing and a bunch of ‘the man’ jokes.  Make no mistake, I offer no apologies and feel that it’s an important trait of any leader no matter the occupation.  I think more should adopt the trait.

First, a little background on the title.  I was speaking to my wife about the exchange and explained my take on my perceived constant optimism.   After a long conversation she smiled and said you’re ‘anti-anti Pollyanna’.  For those of you that are not familiar with the novel (I had to look it up too) the book is about a girl named Pollyanna who plays what is known as ‘The Glad Game’.  Essentially she finds the good in everything.

So why am I the ‘anti-anti Pollyanna’?  The first is that I have 100% confidence in my team to tackle any challenge.  They are, in my world, the best at what they do.  They are some of the most competent technologists I know or have ever known.  It’s easy to have a positive outlook when you feel that your team can tackle just about any obstacle. 

Secondly, as a manager, the people that work for you hang on to every word you say.  This is not a self serving statement.  People buy cars, homes, and plan for the future based on how they feel about job stability.  Think about the recent interactions with your supervisor.  Has anything they said made you double think your current job satisfaction or worry if there will be a pay check next week?  I would be willing to bet you could think of half a dozen instances.

I think in terms of software development this is even more important.  As Technology managers we have a tendency to think more about brining the current project on time and under budget than the ones we manage.  People are the asset, not the project and not the software.  As managers we invest significant amounts of energy, time and money to the development of great teams.  Bad attitudes and bleak outlooks can significantly reduce your ROI on the talent pool you’re attempting to build. 

Managing people is an awesome responsibility that I think some folks take lightly.  Make no mistake, it’s what you are paid to do and just like everything else in your career you should strive to do it well. 

So am I a Pollyanna?  Yes.  But I’m even more Anti-Anti Pollyanna.

Technology, as a profession, is an interesting social experiment.  You can have a front row seat to just about every stereotype imaginable.  Introverts, extroverts, passive aggressive know-it-alls.  They are all contained in this microcosm known as Information Technology.  What I’m finding fascinating of late is the interaction between the generations.

In the interest of full disclosure I’m near the end of Generation X as defined by the greatest source of useless information on the web. 

So what am I seeing?  A greater disconnect between the Boomers and Gen Y.  I think for most folks this probably isn’t much of a surprise.  However, I’m in this precarious position called management.  I have Baby Boomer bosses who come in at the crack of dawn and wonder where all the ‘coders’ are.  I have Gen Y that comes in at 10 and stay until midnight and wonder why all the ‘bosses’ have gone home.  And this is probably the simplest example I can think of.  And if your like me, a Gen X’er, your stuck in the middle as a translator for both sides!  At times this can be a challenging position because you need to be somewhat more conservative in your approaches with Sr level staff, but you also need to build and nurture a team of folks that will become the future of your IT organization.  And god forbid if either side sees you fraternizing with the other!

This sounds like a rant.  However, I’ve had a chance to put some perspective between my initial observations and some recent experiences.  As a Gen' X’er I get the best of both worlds.  I get the experience and guidance from the Boomers who actually have seen it all (even Fortran).  I get the Gen Y’ers that have grown up consuming technology and believe anything is possible and everything SHOULD be easy.  And what do these folks get from this Gen X’er?

Let’s take Your experience and Your enthusiasm and do a start-up.  Seriously, we can IPO in a year.

The last few year have been terrible.  It doesn’t matter what industry you’re in, your education level or place of residency.  The latest economic down-turn has been rough on all of us.  However, there are signs of an upturn and you need to be prepared for it.  How do you position your teams to respond and meet the demand of your business?  Getting smart about outsourcing might be the key!

The next upturn is going to present a few realities that you will need to come to terms with.  The first, is that  your company has ‘right-sized’ your organization at some point.  Translation, you have less resources than you did before the bust.  The second is that the economy is starting to pick-up.  Translation, you will lose talent.  The third, and most important, is that your company will want to be ahead of the curve and implement technologies and products so that they can gain the most by the upswing. 

The challenge as an IT manager is how do you ‘ramp-up’ for the upswing?  You will face the challenge of fleeting talent as well as increased demand.  You need to develop a resource strategy that is scalable and forgivable.  So what is the solution.  Outsourcing.

Outsourcing is probably the one word that will have all IT pros see red.  I think it’s a natural reaction giving the recent experiences of most IT pros.  However, now is the time to leverage the ‘right-size’ outsource solution so that you can continue to meet the demands of your company’s IT demands and best position your team.

So what is this mythical outsourcing phenomenon I speak of?  It’s coming to the realization that you don’t have enough team capacity nor the time or energy to meet the current needs.  You don’t want to bring on full-timers that you will have to layoff  when the demand levels off, you owe your employees more than that for sure.  So now is the time to start to develop outsourcing relationships.  And make no mistake.  These arrangements are relationships. 

Develop Level 1 Outsourcing

Phase one of an outsourcing relationship is simple.  Get some contractors in that your team manages.  Not all firms love this arrangement, but guess what, the economy is tough and they will do it.  The benefit is that you can release or add contractors as your demand requires.  You don’t have to lay anyone off, and the vendors begin to learn what your standards are and what you expect.  You can also use this to see what the strengths and weaknesses of each vendor are.  I call this the ‘getting to know you phase’.  The main advantage is that you can increase the capacity of your team without having to hire an FTE.

Develop Level 2 Outsourcing

This level is a bit more challenging and requires you to have a level of trust.  You have gotten to know a vendor and now want to outsource a project because your team just does not have the capacity to complete it when the business needs it.  It is critical that you make this distinction.  This is not about cost savings, it’s about increased capacity.  Your team needs to have tight control, good project definition and good management in place.  When considering moving to this stage I recommend giving a vendor the easiest or best defined project you have.  At this point your success is tied to theirs and theirs to yours.  I recommend managing risk though the statement of work, verifying work with your own QA resources and assigning your own technical resource to oversee the project. 

The best strategy when negotiating this: Fixed Bid.  Why fixed bid?  Fixed bid is a shared risk.  Each party has skin in the game.  They want to make a profit, you want the project completed.  It puts you and the vendor in a shared  risk relationship. 

Develop Level 3 Outsourcing

I know what you are thinking, level 3 outsourcing is complete project outsourcing.  Something I’ve learned through trial and error is not an optimal solution.  Level 3 is all about reducing cost and freeing up resources.  It’s not project driven.  When you get to level 3 you should be looking to outsource the remedial tasks that your full-time staff does day-to-day. Also known as application maintenance.  At level 3 you want to move maintenance to a lower cost resource so your internal resources can continue to spend time managing Level 2 while keeping IP in-house!

The economy is picking up.  Now is the time to start implementing these strategies!