And Vijay Says…

When I left the services world few years ago, the truth is – it was rather boring. Whether it was ERP or analytics or mobility, there were very few projects that were fun to sell and deliver. Yes – I did say fun , and with a straight face !. Don’t get me wrong – between then and now, it is no less difficult to sell and deliver consulting projects. The big difference is that the problems we get to tackle, the buying behavior of clients, and the technology options available to solve those problems all make it a lot of fun to work in.

A lot of credit goes to customers – they are pushing the vendors harder today and rightfully so. Many more leaders want to differentiate their companies to an extreme in a short time, and not in small increments. More than technology capabilities per se (that is a given – you don’t get a seat at the table without the tech chops) – they are looking for partners who can help them think through their roadmap and identify new opportunities. They are happy to take risks – as long as vendors are open to risks and rewards being shared . I am even seeing signs of procurement function getting modernized too in their approach to software and services purchases.

Sophisticated business solutions are complex by nature – except the customer has little to no reason to deal with the complex technology directly. Last week, I met with a large sports CIO and his IT staff is essentially 3 people. He had very little interest in what happens behind the scenes – he just needs some very sophisticated requirements to be satisfied. Conceptually what he wants is “cloud ” – except he never said the word, and even when I asked him point blank, his response was “I don’t really care Vijay – you can deliver any way you like as long as my parameters are met, for the money I have available to spend”. The CMO who was sitting next to him added “And if you show me how my firm makes more $$ by using your solution – I am happy to keep paying you more”. Not to be out done – the CFO got into his ask “And if these guys are happy with your solution – I want to sit with you and see your models on different capex and opex combinations on how we pay you”.

This conversation repeated more or less exactly the next day in Manhattan – where I met with another CTO/CMO/CFO combo team. The one difference here was that the CTO staff wanted full visibility into how underlying technology worked. Just visibility – like a car’s dashboard where you get to see if there is a check engine light, but need to schedule a mechanic to fix it. We also had a passionate debate on NoSQL vs Hadoop – and then they said “we know we don’t need to worry about that in a cloud model, but want to make sure you have thought through our workloads correctly”. Thankfully we had .

And to round off the week was a senior exec at a Telco – and all he wanted was to check is if his roadmap for digital transformation for his business can be executed in half the time, without changing any of the underlying technology. Next week we will do a series of design thinking sessions to figure it out.

There is never a dull moment. No two deals or projects look cookie cutter like the ERP projects I grew up with. Boredom is the farthest from my mind when I spend a morning explaining to a VP of BI why her expectations of a data lake needs to be different from the data warehouse she is used to, and then spend the afternoon with a COO showing how Watson can reduce subscriber churn. Tiring – yes. Boring – hell no !

Whether it is story telling, crafting the right financial model, figuring out the right tech solution or even assembling the right team – fun is back in the business. All the things we needed in the past – like deep relationships, trust etc continue to be as important as ever, just that the entire approach is different now on both sales and delivery. We spend a lot more time discussing the effectiveness of solutions – efficiency is a given and we don’t need to spend time and energy reinventing the wheel.

Sales always had elements of fun where new and interesting ways to pitch to a client was always an in-thing. What has really started to change now is actual delivery. Everyone is now pitching in – PMs, devs, ops folks, analysts, interns – to creating a storyline that makes sense of the bigger picture and how their piece parts fit in. It is such a great feeling to see how much less work it is technically when we make micro-corrections daily. The lines between discrete products and services that put them together is still very much there – but it is starting to blur to a large extent. Tactically – a new generation of product managers (probably better called solutions managers) are arising , and they bring together the world of products and services.

The one thing that is NOT FUN that can and should change is the need to travel to deliver solutions. Even with cutting edge video conferencing and other collaboration tools, customers still expect all consultants to show their faces weekly onsite. There are parts of our business where this is less of a problem – like our designers working out of studios and only visiting customer offices periodically. I am hopeful that services business will largely move into a model where there is less travel involved. The sheer amount of time and money spent in air travel is an absolute waste and that is the next thing that needs to transform in large scale.

 

But for facebook and whatsapp, I would not have had a chance to reconnect with so many of my old friends from school and college times. Nothing beats the fun of recollecting and virtually reliving “good old days” . I religiously check whatsapp for messages from both my school and my engineering college days. Sadly, the group we have for our Business school class mates never became active. Its a lot of fun to be a teenager again in virtual world – and prove that the kid in us has not died .

When we run out of topics, the more “adult” topics come up for discussion. We move from teenagers to 40 year olds in a hurry and a fairly homogeneous group shifts gear to being heterogeneous . And while good debates do happen , common ground is seldom to be found. Good thing is that the worst that will happen is that we take a time out and then go back to teenage times where it is all fun and light hearted.

I often compare this to the alumni meetings that my dad goes to – and many that I have attended with my wife and daughter as guests. The bond they have amongst their friends need to be seen to be believed . 100% respect for each other, hardly a topic where they disagree, accomplishes a lot and every one has fun – including their families. Granted they have had 30 years more time to get to this state – but is that all there is ? I think there is another factor at play – their interaction is via phone, physical meetings and the most advanced amongst them email each other. They don’t meet virtually 15 times a day on whatsapp !

The irony is that my dad and his buddies have told me a hundred times how much they envy my generation for being so tech savvy. They believe we are better off with all the technology we have access to and that they too wish they were as hyper connected as we are. And here I am thinking that they are the blessed ones with just enough technology .

The general tendency in any online community is that 80% of conversation is between 20% of members. Rest are silent readers who won’t say a word in public – for whatever reason. Some of those who remain silent – they do privately mention their opinions to one of the vocal ones. So the 20% who are vocal , they occasionally think they voice the opinion of several others. This is a slippery slope – because a lot of nuances of individual opinions get lost when aggregated. The end result is that strong disagreements happen and feelings get hurt.

In theory, social media is a great equalizer. After school. we have all charted our own ways. And when we meet in virtual world – we are equals . But we are also grown up men who have our own insecurities. The mix of physical world with virtual is like oil and water in many cases and that is kind of sad. It cannot be denied – we are all individuals and have different tolerance thresholds.

One benefit of having instant access to friends from every corner of the world is the ease of organizing in-person meetings . I have been part of a handful of those meetings and loved every minute . But of course not every one can make those meetings. So then the information from those meetings flows back to the virtual world via second and third hand accounts and there we go on yet another slippery slope that lead to hurt feelings, time outs and resets.

This makes me wonder what is the best purpose of reuniting old friends ? Is it just for fun of reliving old times ? Should it be doing something in terms of “pay it forward” , like scholarships, charity etc ? Is it to improve the institution that is the common ground for all of us to be friends in the first place ?

There are no easy answers. If it is for fun – on the good side, every one has common ground. On the flip side people run out of topics after initial excitement and the group dies a natural death .

What about “pay it forward” ? On the good side, it is a good cause and some common ground can be found in principle.  On the flip side – there are many ways to do it and not everyone agrees on best way in practice. There is also a question on who funds and who executes. Given how global the world is – the ability to contribute money varies from the ability to execute something with the money collected. This is the “adult” world and there it is common to run into differences unlike the “fun” world where everyone is a school kid again.

Should it be broad based or focused narrowly ?  When it comes to “adult” topics, I think broad based is the only realistic option. If there is only goal- obviously there is a chance for a binary split in any group of grown ups, and being virtual does not make it easy to resolve.  But a broad agenda has the chance that we learn to prioritize, have some healthy tension and everyone sacrifices a little for common good. It is only a hypothesis – I haven’t the slightest idea whether it will work .

Lets just say – social media giveth, and social media taketh away 🙂

 

 

 

 

I firmly believe the future of consulting is all about outcomes based work. In principle, this is easy to understand and there are several examples of projects where this has been successful. A welcome change in these contracts is that the actual paperwork is significantly lighter than the paper monsters we have all dealt with in the past.

In its most “unsexy” extreme – think of a maintenance contract. Customer wants a certain number of trouble tickets every year for a certain amount of money from an outsourcer. Whether the vendor solves it by automation, by offshoring or by whatever means should not matter to the customer as long as the SLA is met . Simple as it gets on paper – but it is not simple in practice.

The CIO who signed the contract gets it. But the order entry clerk whose printer stops working can no longer walk over to end of the hall and find Joe, the printer guy, to fix it. He needs to raise a ticket and wait for 4 hours to get it fixed. Result “our vendor sucks”, low NPS scores , CIO getting all kinds of hate mail and so on. Experts on twitter will say “Big Outsourcer screws over customer with poor service”.

Lets also look at the “sexy” extreme – think of a business KPI like inventory turns as the metric that defines the outcome. A baseline is made today and vendor pays a penalty when turns decrease, and vendor gets a share of the gain when turns increase. Sounds like a fair deal on paper. What can go wrong when both parties share risk and return ?

End of the year customer and vendor are sitting together to compute turns and voila – turns increased by 20% and according to contract the customer needs to pay a lot of money now to the vendor.

Scenario 1 – was all 20% of the goodness due to the Vendor’s work ? What was the contribution of the new store manager Jane who introduced more discipline in the warehouse? .

Scenario 2 – ok ok, so it was all due to the vendor’s good work. But there were so many returns . So the customer did not really get the business benefits. What now ?

Lets also flip this situation and say turns decreased by 30%. Customer wants a big fat check as penalty.

Scenario 1 – well you fired all the experienced managers and hired cheaper inexperienced folks. What did you expect? But for the vendor, turns would have been 70% lower instead of 30%.

Scenario 2 – This would have worked like a charm, except for the flood in India causing disruption. You never signed up for the extra location we begged you to sign for just a little more money.

You get the drift – this gets complex in a hurry on both extremes, and results in all kinds of unpleasantness. What was done to move away from rewarding effort and complexity to rewarding outcomes and simplicity just did not pan out.

Is there a way out ? Of course there is a way out. That needs each side to have some trust in each other to begin with . It also needs these contracts to be in place for a long period of time to make sure that both sides get a fair shake. Contracts need to stop being about “average price per hour” to benchmarks that measure outcomes across the industry. And this needs a lot of “change management” initiative to set and reinforce the right expectations. The order entry clerk needs to know that his performance metrics should be adjusted to reflect the fact that a broken printer takes four hours to fix now – he should not be punished for a decision he did not take.

I can say first hand that this works quite well when you find the right sponsors on both sides of the table. But it is anything but the “walk in the park” that it looks like from the outside.