If you’ve been doing outsourcing for awhile, this article may not be for you. But if you’re new to it or feel like you may be missing something, maybe there’s some useful ideas in here for you. When working with any contract service, whether it’s a physical re-model of your corporate lobby or a multi-million dollar system that will change the world, many of the same considerations apply.

In this first part of How to Work with Software Development Companies, we’ll look at the beginning of the engagement process though the proposal and negotiation phase. In Part 2, we’ll get more into estimates, SOWs and MSAs, and dealing with change orders followed by project delivery. [Read more…]

Every single thing you do as a senior leader at your company is generally about delivering value. What this means will of course vary based on your firm and its many stakeholders. But one thing in our present state of affairs is clear enough: In just about any firm bigger than a corner lemonade stand, software is likely going to play a non-trivial role anywhere from being part of a strategically core competitive product, to playing a key role in business processes.

Depending on whose numbers you believe accurate, there’s about 20-23 million software developers in the world as of 2018. In the U.S., maybe 3.5-4.5 million. Discrepancies can easily be attributed to how you count. For example, are QA Engineers software developers? Is a mathematician who works on algorithms, but doesn’t commit code a software engineer? There’s some slop in the numbers. Whatever. Regardless of how you count talented software developers, right now there don’t seem to be enough. (Unless you happen to be pounding code yourself and enjoying having the hot career ticket!) Yes, thousands are in the midst of Python Boot Camps and “Yes, You Too Can Be a Data Scientist”  courses. Still, the bottom line for you as a senior manager is for your current emergency project or other ongoing needs, you don’t have the development resources on staff that you need. And depending on where you are, budget, and all the usual reasons, you may struggle to build internal teams in the currently challenging hiring environment for talent. If you’ve been doing outsourcing for awhile, this article may not be for you. But if you’re new to it or feel like you may be missing something, maybe there’s some useful ideas in here for you. [Read more…]

Oh no. Not another article on someone’s idea about how to do corporate innovation. Yes. Sorry. Here it comes.

TL;DR version: Form a group. Make sure they’re actually entrepreneurs or have true entrepreneur mindset. Give them their own P&L. And get them away from the mothership. Is this always the best way? No. Of course not. But it’s something to consider. And here’s the long winded version as to why…

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This – long – post is a reaction to more than a handful of recent conversations I’ve had with friends or networking friends who have had some sub-optimal experiences lately in various company’s recruitment practices. (Actually, these have been some piss-poor really @#$@#$ experiences. I’m just trying to clean things up a bit.)

What’s the Problem?

There’s some big, obvious reasons you could have trouble recruiting. Maybe your company/brand reputation is lousy. Maybe you’re not paying enough. Maybe you have some crappy managers and one or both online networks and the whisper network knows it. (After all, it’s become a cliche that people often don’t so much leave a job or a company so much as a manager. Not always true of course. But often enough the case.)

There could be a whole lot more reasons you’re having challenges getting the right people in the right seats. But here’s a new pair for you to consider. Horrible initial contact and really bad Application Tracking Systems and Candidate Evaluation Processes. As a hiring manager, you might have limited control over this sort of thing at a larger company where Human Resources is in control of such systems. But if you’re senior enough at your company, you may want to take a peek at these things because they may be hurting you. This blog post was motivated by a couple of my own experiences along with discussions with others who’ve had similar – or worse – experiences. It could be just a statistically random blip with a raft of recent issues of which I just happened to become aware. Or things could be getting worse in some cases. So I’ll just throw these thoughts out there into the world and you can take them as you will. [Read more…]

If you’re in an older company suffering from Innovator’s Dilemma type issues, you may have hidden costs beyond what you realize. (If you’re not even familiar with Innovator’s Dilemma issues, then you have hidden costs and major hidden risks far beyond what you realize.)

Over the past few years, I’ve had some interesting experiences interacting with companies attempting various types of innovation strategy that struggle to do so. I’m not talking about my Clients of course. They’re innovating for real. Some of my more negative experiences have been via pitching business or participating in various networking events.

Anyway, here’s some of what I’ve learned about companies that are doing a poor or at least a sub-optimal  job of new product development or innovation. (Even if they have so-called Innovation initiatives.)

You Can’t Recruit the Best

I go over a variety of issues regarding recruiting in this post Another Reason You Might Have Trouble Recruiting so some aspects of this section may be a repeat for the two of you that hungrily eat up each and every post.

The short version of that other post is that your company has a reputation and it’s both public and on the whisper net. The whisper network is that cohort of potential employees and recruiters in the industry who talk to one another. For real. As in on the phone; not just via posts on Glassdoor or whatever. They’re networked in ways not always obvious on LinkedIn, but they know the deal at your place. If you have crappy managers or if you talk innovation, but don’t really do it, they know. And they take a pass when the recruiter calls. To get past this, you might need to hire a serious disruptor that’s at least somewhat known in the industry or at least can quickly demonstrate that you’re really going to be doing some interesting things.

This cost to a company may be the greatest ever. Because you won’t be able to get the best people to show up. Or even really good people Without that, how do you produce great new products? And the thing is, you won’t even know this is going on.

You’re Not Really Innovating

It’s one thing to say, “Here’s our Innovation Group,” and it’s quite another to actually do anything that’s interesting and also creates business value.

Let’s also remember there’s different types of innovation. The cool kids in tech and startup land like to think of themselves as the Super Innovators and think just about anything old school corporate is ripe for disruption. (And ok, a lot of times they’re correct.) But there’s another reality as well. Large corporate does innovate. All the time. There’s a constant flow of new products. And those products come from doing world class core basic research from materials science to semiconductors to whatever. Product ideas also come from piles of customer service information, working with customers and hearing their problems, and so on. Startups likely have a lot to learn from such companies. Just as one of many examples, 3M is what most would consider to be a fairly old guard manufacturing company. Yet, they’re increasing R&D spend to 6% of revenue in 2017. (See Forbes: R&D: One Of The Driving Factors Behind 3M’s Growth.)

3M actually invented the Vitality Index to use as a KPI, and it measures the percentage of sales that are coming from new products. What is “new” in terms of a product and how long something is new might be debatable and different by company. But assume we’re talking about at least a material improvement and within three years. What’s 3Ms current number? It’s a bit over 30% in 2015. I’d argue that in this case, 3M is definitely innovating! Are you? Really? What’s your vitality calculation look like? Don’t have one? Figure it out. If you’re in single digits that’s maybe a problem.

What about you? Are you really innovating? Minor “new and improved” changes are probably not going to take you to the next $100M or beyond. Or maybe they will if your volume is high enough. But will what you’re doing be enough to hold back a true disruptor? Are you listening carefully enough to get a sense that something might be changing in your customers’ needs? Are you trying to do the hard work of changing cultural DNA to include innovation? Or do you have an elite innovation team somewhere? If a team, are they able to get anything done? Or do they face overwhelming pushback everywhere in the organization?

It’s possible you have “Innovation” on some business cards. And a few consultants training some special teams. But if new products or services aren’t being pushed out within months or if none of them are making inroads, chances are you’re not getting new things done very well just yet. This could have a triple negative effect: 1) Cost of the effort resulting in nothing; possibly not even much learning in terms of failure, 2) negative momentum in the marketplace, 3) a feeling that nonetheless you’re doing something even though motion certainly doesn’t equal progress.

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