Wednesday, March 23, 2011
Worst Practices of IT Consulting and Outsourcing
If you were CIO and I was a direct report and I told you that I only wanted to spend one hour a day managing my team, what would you think? Now ask yourself what happens if you are an employee of an IT Outsourcing firm where you may spend eight to ten hours a day interacting with the client and only one hour a day after you are burnt out interacting with your offshore team?
Historically speaking, there was a profound difference between contracting and consulting. Nowadays, the line that separates them is increasingly and intentionally being blurred. The notion of a "blended" rate where you are sold both under the guise of getting the best of both worlds is a misnomer at best. While you may be receiving the "polish" of a consulting firm in terms of its documented deliverables, are you truly receiving thought leadership that drives your business forward? If I give you a challenge that requires you to do deep thinking, do you think that individuals who excel at solving problems are being responsibly leveraged by doing rote documentation? Ask yourself is it in your best interest to have separation in order to provide transparency over the ability to disguise? Does it benefit you to leverage an individual in areas of their strength or to look for a jack of all trades?
Have you considered that many consultancies use documentation as a way of creating additional billables? We all know that in today's society, no one actually reads anything, especially IT executives. If the average attention span of most IT executives is no more than a half-hour, then why are you creating documentation that takes longer than that to read? Have you ever asked yourself the true value of the documentation you are asking for? Of course the value to the outsourcing firm is that it allows them to learn on your nickel and is a low-risk activity, but what benefit does it provide to your organization. Documentation is a great tool for helping along organizational memory, but is less effective in terms of helping convey concepts within a project. Why create lots of documentation for some unknown future purpose and unknown future audience especially acknowledging the simple fact that few actually have time to read it now and the odds of this being addressed in the future are dismal.
Why are you outsourcing to India and not considering other parts of the planet? Did you know that there are many shops nearshore that can provide the same rates but deliver at a higher quality? If we can put aside political correctness for a moment and were to truly understand the technology in which we manage, we may conclude that some of the best and brightest talent in the IT industry exists within the vices. Want a content management strategy, I can think of several adult sites that effectively manage content better than most enterprises. Ever look at those otherwise illegal gambling sites? Did you know that they know how to load balance traffic across countries and never lose a transaction? Wouldn't you love to be able to say this about your current IT shop? Why are you getting rote strategies from the large guys when there are people who have obvious in-depth experience that are right in your backyard?
Have you ever analyzed the economics of traveling consultants? Many corporations have their consultants travel onsite every week incurring more expense than necessary. Sometimes, this is to keep a watch out on consultants which in reality is a code phrase for stating they really have no way of measuring that individual's contribution. Others will use the logic that says that it affords the opportunity for spontaneous interactions. This is ironic since many consultancies only allow the partner/director-level to have the interactions while the junior staff is usually buried away performing clerical tasks and rarely having any client interaction.
Imagine a scenario of a ten person team traveling from Dallas to Chicago every week in order to be on client site. If eight of the ten team members don't have significant client interaction, then you are paying for a $300 flight, at least $400 in hotels/meals/parking, etc for each person. That additional $700 per person per week equates to a total of $5,600 a week that could be used to hire additional full-time staff, perform necessary upgrades on software or other purposes that benefit the enterprise...
| | View blog reactionsHistorically speaking, there was a profound difference between contracting and consulting. Nowadays, the line that separates them is increasingly and intentionally being blurred. The notion of a "blended" rate where you are sold both under the guise of getting the best of both worlds is a misnomer at best. While you may be receiving the "polish" of a consulting firm in terms of its documented deliverables, are you truly receiving thought leadership that drives your business forward? If I give you a challenge that requires you to do deep thinking, do you think that individuals who excel at solving problems are being responsibly leveraged by doing rote documentation? Ask yourself is it in your best interest to have separation in order to provide transparency over the ability to disguise? Does it benefit you to leverage an individual in areas of their strength or to look for a jack of all trades?
Have you considered that many consultancies use documentation as a way of creating additional billables? We all know that in today's society, no one actually reads anything, especially IT executives. If the average attention span of most IT executives is no more than a half-hour, then why are you creating documentation that takes longer than that to read? Have you ever asked yourself the true value of the documentation you are asking for? Of course the value to the outsourcing firm is that it allows them to learn on your nickel and is a low-risk activity, but what benefit does it provide to your organization. Documentation is a great tool for helping along organizational memory, but is less effective in terms of helping convey concepts within a project. Why create lots of documentation for some unknown future purpose and unknown future audience especially acknowledging the simple fact that few actually have time to read it now and the odds of this being addressed in the future are dismal.
Why are you outsourcing to India and not considering other parts of the planet? Did you know that there are many shops nearshore that can provide the same rates but deliver at a higher quality? If we can put aside political correctness for a moment and were to truly understand the technology in which we manage, we may conclude that some of the best and brightest talent in the IT industry exists within the vices. Want a content management strategy, I can think of several adult sites that effectively manage content better than most enterprises. Ever look at those otherwise illegal gambling sites? Did you know that they know how to load balance traffic across countries and never lose a transaction? Wouldn't you love to be able to say this about your current IT shop? Why are you getting rote strategies from the large guys when there are people who have obvious in-depth experience that are right in your backyard?
Have you ever analyzed the economics of traveling consultants? Many corporations have their consultants travel onsite every week incurring more expense than necessary. Sometimes, this is to keep a watch out on consultants which in reality is a code phrase for stating they really have no way of measuring that individual's contribution. Others will use the logic that says that it affords the opportunity for spontaneous interactions. This is ironic since many consultancies only allow the partner/director-level to have the interactions while the junior staff is usually buried away performing clerical tasks and rarely having any client interaction.
Imagine a scenario of a ten person team traveling from Dallas to Chicago every week in order to be on client site. If eight of the ten team members don't have significant client interaction, then you are paying for a $300 flight, at least $400 in hotels/meals/parking, etc for each person. That additional $700 per person per week equates to a total of $5,600 a week that could be used to hire additional full-time staff, perform necessary upgrades on software or other purposes that benefit the enterprise...
