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People - A company's greatest asset

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Many factors influence the success of a company, but none so much as its employees. Of the three Ps, People, Product, and Process, which contribute to a successful project or company, it is the caliber and composition of the staff that provides the greatest predictor of success. I suspect HR professionals intrinsically appreciate this, as "people" are their currency. But in IT, "product" is our currency and "process" is the mechanism by which we craft our product. Inadvertently this often creates an environment where attention to the people component is not given the appropriate level of attention.

I am being pretty abstract, so let's refer to an example I am sure you are familiar with.

A few years ago I worked on a project which received an award for process innovation. As a consultant, I was brought in to a hospital to assist in reengineering their Assessment Centre ("AC"). The AC performed third party assessments on patients' injuries to aid in the creation of treatment plans and resolution of legal disputes. In just a few years the AC had become tremendously successful for the hospital, and it had outgrown their run-your-company-by-Excel processes. We spent close to three years evaluating the business, mapping existing and to-be processes, determining requirements, appraising and selecting vendors, and then implementing the solution. Looking back, the time and energy expended on selecting any one of the several products that were part of the solution completely dwarfed the effort to secure the absolute best people to work with the solution. Yet ultimately, this was a solution to support complex case management, emotional treatment and legal decisions, and a myriad of case exceptions. The importance of the staff to the success of this project far outweighed the products we spent so much time meticulously evaluating and selecting.

Yes, that is correct, I am saying our effort selecting the software products and our effort selecting the people should have been reversed. For this reason alone, I believe the project was not nearly as successful as it should have been. Here is another example:

I am presently involved in the implementation of a clinical Oracle application. It took us over a year to select Oracle as our platform. Industry regulations and governance concerns placed a significant burden on our evaluation and decision making process. Ultimately the CEO and multiple VPs of our Fortune 20 company signed off on this product. Conversely, the project lead was hired through a cookie-cutter process. The effort expended to hire her was only nominally greater than hiring a non-knowledge worker. And yet, the project lead will have a huge impact on the success of this project. (Fortunately for me, Rebecca is brilliant!)

I will skip the governance issue altogether except to suggest that from the governance perspective a "bad choice" of person should be at least as equal a concern as a "bad choice" of product.

The difference between Oracle, which is best of breed in this product class, and the tier two products is not as great as the difference between a mediocre project lead and a great project lead. Put another way, a good project lead will make up for some inadequacies in the product, whereas a good product is not as likely to make up for inadequacies in the project lead.

A solution can be successful with less than ideal products. In the late 1980's Microsoft bundled Word, Excel, PowerPoint, and Mail together into the first version of Office. At the time these individual products were generally recognized as second- rate products. Yet the resulting suite was enormously successful. When people are a critical part of the solution, can the solution be successful with second-rate people? I will argue that this is often one of the highly overlooked areas of unsuccessful projects.

A lot can be said about the advantages of good people. Here is one quote that I like: "The best thing that can happen to any software project is to have people who know what they are doing and have the courage and self-discipline to do it. Knowledgeable people do what is right and avoid what is wrong. Courageous people tell the truth when others want to hear something else. Disciplined people work through projects and don't cut corners." To this I will add that in any project many of the greatest challenges are in handling the exceptions. Again, an intelligent person is better equipped to handle the unanticipated than a strong product or robust processes. But a career bureaucrat is going to do more harm than… You get the picture.

And what of the financial aspect? In my earlier example doesn't Oracle cost many times more than the project lead? Let's look at this. The overall implementation runs in the low millions of dollars, but much of that cost is independent of the product. (i.e. training costs, servers, consultant fees, etc.) The product cost, in this case the Oracle licensing, runs in the low hundreds-of-thousands over five years. The project lead will be in the mid hundreds over the same period of time. The project lead, without accounting for any other "people", has a bigger impact on both project outcome and project cost!

Have you performed an evaluation for a new enterprise product recently? Have you hired somebody recently? Which was more involved? [Nodding Head] Uh huh, I thought so. (Don't fret. This is true of every enterprise project I have ever worked on.)

People are a company's single greatest expense and they are the single greatest determinant if a task, project, or company as a whole will be successful. Don't skimp on your people. The marginally extra cost should be one of the easiest ROI models to defend.

I will follow up with some strategies on how to ensure you are retaining the best talent.

As always, I am curious to hear your feedback.

Adam

Comments
  • Adam, I wholeheartedly endorse your views on people. It is all too easy to focus on  technical skills and not pay enough attention to the "quality" of the person. I have put "quality" in quotes quite deliberately because it is truly often hard to define. As someone who, as part of my engineering career, has hired (and fired) a large number of people, I could not give you a logical explanation for every hire that I have made. Some are "gut" based and how one quantifies that I am not sure.

    In my case, fortunately, I could probably count the number of people on one hand chosen on that basis that turned out to be a dud. Engineering being very cyclic they didn't usually last too long! On the other hand a significant number of the people hired in an upturn in business were not those who were de-hired in a downturn. In other words you should always shrink to "strength".

    Very often what happens is the opposite and there is a tendency to keep the same people who have been "around" for some time. I have heard many times, "We cannot afford the redundancy costs of letting certain people go". Whilst every case must be treated on its merits, I would argue that you cannot afford to keep them in the longer term if they are costing you money and possibly lost opportunity. Yes, it is a hard world and no matter how many times I faced having to let people go, it never got any easier, especially when some of them had been "around" for 15 to 20 years!

    Perhpas the most extreme hiring example in my case was a gentleman who had just arrived in Canada from Malaysia. He sent me this scruffy handwritten one page resume and some samples of his work. The resume was virtually useless but something (who knows what!) made me look at his work. Ordinarily I would have filed him in the WPB (waste paper bin) without hesitation and I don't know to this day why I didn't. I was impressed with the samples of his work and hired him in a junior position (just being cautious). That was a big mistake; not because he was no good. He was an "ace"; a "diamond in the rough"! My mistake meant that I just couldn't promote him fast enough. I had a constant battle with HR because he didn't "fit the norm".

    The other side of this coin is "quality" management. You can have the "best" people but if you cannot get the "best" from them then you still have a problem. I don't propose to go into that here. In fact by a strange coincidence thoughts about that topic have been running through my head recently and I might just post on that. Why that should be the case I really don't know because I am no longer in a management position. Maybe those guys in "white coats" are getting closer by the minute :).

    Cheers
    Graham Jones

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