12 Steps to Beat Your Service-Provider Addiction

eastbayted writes "It starts off simply enough: Your company signs on an outside firm to help you finish an important app dev project on deadline. But then they convince you they can be of service in getting other work done at your company, and you agree. Before you know it, your organization has become far too dependent on this team of outsiders on whom you're wasting a ton of money and perhaps not getting much in the way of a return. InfoWorld has devised a 12-step program 'that can help wean you off unhealthy dependencies on service providers, consultants, and outsourcers — without having to check into the Betty Ford Clinic or make a tearful confession on Oprah.'"

Comments

Printer (and reader) friendly:

[Anonymous Coward]

http://www.infoworld.com/archives/emailPrint.jsp?R =printThis&A=/article/06/08/28/35FEservices_1.html

Like most things, incompetence is to blame.

[mgblst]

The print version: http://www.infoworld.com/archives/emailPrint.jsp?R =printThis&A=/article/06/08/28/35FEservices_1.html

This comes through incompetence - it is too easy to hire outside help, and not setup an exit strategy (you listening, bush and blair?), when you don't understand the problem and won't ask for help. It is easier to get outside help than realise what you will need in the long term, and start hiring people. Oh, but when you need a new secretary, that gets done within the week.

Too many non-IT (and I am sure this happens in other departments) people are put in to manage IT infrastructure, and because they have in the past, feel the need to be making the important decisions. This is what happens.

And hire someone like IBM, and you will never get rid of them.

If people could do it themselves, they would

[petes_PoV]

Of the article's 12 steps, 2 are the reasons you got the SPs in, in the first place.

Step 5. Seek out expertise. Yes, that's a good reason to bring in external people. You don't have the skills in house and it's not cost/time effective to hire or train your own staff.

Step 8. Hire knowledge you need. Sounds pretty much like step 5 to me.

As for step 12: Give yourself over to a higher power -- your employees.

So, who's going to do their jobs while they "work side by side with the consultants"? Oh, I know. let's get more consultants in.

This article looks like it was written by the very people you're trying to get rid of. They can give you pretty prsentations and high-level bullet points. However, when you look under the covers at the substance. it all disappears.

Use consultants when you have an extraordinary need, if you really have to.

Better to have them do the mundane stuff, and train you own people to do the cutting edge, interesting, high-value work....... Assuming they're good enough.

Re:If people could do it themselves, they would

[Anonymous Coward]

As a consultant, I see it all the time - companies have a really poor opinion of their employees and a slick consulting firm can easily appear to be attractive (regardless of their competence). So organisations really need to understand what consultants can do for them and why they cannot do it in house. A good consulting firm and service provider is worth their expertise and experience.

In general organisations that have trouble getting rid of consultants are really really bad.
I have been working on a six month project for two years now and we (as the consultants) are trying to find an acceptable exit strategy for ourselves. But due to staff turnover and limitations of our scope to design (XP/Win2003 infrastructure implementation) work only , we cannot get them over the edge in terms of operations procedures so that they can run with the deployment to 1000 sites.

It is frustrating because we know we don't need to be there and we are losing good personnel because they are not being challenged as they continually need to hand hold the existing and new company staff.

Understand why

[James Youngman]

Interestingly the article doesn't point out to the reader that they also need to pay attention to the reasons why the service provider got called in in the first place, any why they needed to stay so long. There's an underlying issue there (be it manpower, organisational ability, wrong executive sponsorship of projects, skills, poor control of scope creep, etc.) The underlying issue needs to be addressed or you will be back in the same situation before you know it.

Re:Understand why

[UKRevenant]

The reason they stay so long is often simply down to inertia. The "We've started so we'll finish." coupled nicely to the "Why did we pay them so much if we are not going to listen to them?".

I used to work for a company that was taken over by an asset stripping industrial conglomerate, to make sure they got the best return for their money they sent in consultants for every department. Sadly, in the engineering department we used lots of fancy computers running non-industry standard programs. So, when the consultant came to look he had no idea what the system actually was doing or what it was capable of. His recommendation was to shift to industry standards, including AutoCad, which the company did despite my best efforts. The company lost its competitive edge as soon as the standard software was put in. I had 2 of the existing suppliers (one the main application provider, the other the hardware/os support company) they both submitted very similar suggestions for the way forward. The application provider, obviously, had a vested interest. The support company had no vested interest as they expected to continue to provide support regardless of the direction chosen.

I presented my own findings and pointed out several flaws in the consultants report, I also presented the reports from the 2 other companies. The only thing I was asked about the reports was who had authorised the spend on the additional reports and when I said they had been provided for no charge, I was told the company had spent thousands on the consultant and for that reason would be going ahead with his suggestions. I resigned at that point.

In case you are interested, the consultants suggestions were implimented in full at great cost and since the old systems were decommissioned the productivity of the company has dropped, which has had the obvious outcome of reducing it in size to about 10% the size it was when I left.

On a plus note, the consultant made me move into a much more enjoyable and profitable job.

Re:Understand why

[gusmao]

For what I've observed, high management just doesn't see any underlying issue. I once have prooved to my old manager that it would be much cheaper and less riksy for the company to hire permanent employees and pay them fairly than keep spending tons of money on consulting and outsourcing for long periods of times. He replied that new employees would be seen as an increase in headcount (and consequently in expenses) as opposed to hiring a consulting firm, which is considered an investment. In other words, it would look good in the balance sheet for the stackeholders, even though the company would be losing more money.
As long stakeholders are happy and high management is getting their bonuses, there's no issue at all.

Re:Use strategic open sourcing

[arivanov]

This is not necessary. In fact it is not enough. Both open source and close source applications can be a quagmire where developers simply go and get lost for ages. In fact making the application open source does nothing and proves nothing as far as long term maintainability. Similarly, an open source application can store its data in an absolutely nightmarish format understandable only to itself.

What matters is splitting projects and applications into small understandable modules which well defined and well documented API and make them operate on well defined data flows which are as open and easy to understand as possible.

From there on a module can be thrown out, replaced and modified at will at any particular moment with minimal fuss. Similarly, any vendor which has become too pushy can be shown the door and replaced with an alternative one.

Further onto this the first person to manage "easy" object persistence (like the Open Source Prevayler) should be quartered, skinned, boiled and the remains hanged at down. It is essential for the long term health of a module for it to store the data in a format that is understandable and accessible by third parties and not just itself. Prevayler (and the similar commercial frameworks) break this to bits. In fact it is possibly the best example for an Open Source lock-in tool I can think of.

Hey!!

[AnomalousTurd]

I work for one of these service providers. Reliance on IT outsourcing is pretty common these days for major companies. Even technology based companies. I feel in many cases that paradoxically, it is a way for the companies to get back in control of their IT which may otherwise have become a self-serving money-eating monster.

Incidentally I would think a large percentage of slashdot readers are in outsourcing.

Outsourcing Done Wrong.......Sigh

[segedunum]

Many companies get outsourcing wrong, particularly in IT, because they have have managers who don't know how things work, they've never written a line of code or put in a server in their lives and don't seem to have a learning gene inside them. I work in a company who has a contract with a financial company for a major system, and honestly, I think we're the only ones who care sometimes. Of course we're the only ones who knows how the app works. We're certainly the only ones who seems to know what's going on, and if something happens even remotely related in the general area of our system we have all sorts of people in the company instantly hanging on to our apron strings and phoning us up. I suppose it's because many boring companies, like financial ones, just can't attract the right people who can think for themselves - hence they become even more dependant on outsourcers and consultants than they otherwise would be. When you see how many of these companies operate, you can see why.

This part of the article I always worry about:

You must roll out a major enterprise app on a tight deadline and you don't have the bodies to pull it off. So you borrow some money from next year's budget and hire a global services firm to help.

This never works - ever. Managers of IT projects who don't know much about IT seem to have this incredibly bizarre idea that IT people, programmers and analysts are all interchangeable. You can drop someone from a project two months away from the deadline, bring someone else in who knows nothing about what's going on and the new person will instantly hit the ground running. They also do it again, and again, and again and again. They also equate getting bodies on the project directly with getting it done faster. If something is late and obviously a complete mess it instantly becomes a resource problem. Not that I like calling 'people' 'resources'.

I've seen it time and again. Company gets an outsourcing company and consultants in to develop a system because they don't have the people or the expertise. Said company has no real idea what the requirements are in terms that they can get over to the consultants, they have no real idea exactly what they want these consultants to do and the whole thing becomes a mess with the outsourcing company, quite rightly, creaming off whatever money they can because of the ignorance and lack of clarity from the main company. The company then starts to bitch and whine about the 'leech' outsourcer and the relationship deteriorates. Rinse and repeat the process for the next outsourcing company.

The article can be summed up thus. Fire the useless people in your company and employ good people who can define requirements well, and consequently, can lay it on the line to outside consultants exactly what they want. The consultants will then actually be much happier, because they will know what it is they've got to do - something they probably haven't had much of ;-).

From the consultant's side of things

[bhmit1]

I am one of those hated consultants, and I see things pan out three different ways:

1. Never ending project. This one usually seems pretty straight forward and then management keeps extending. When those extensions are because they see the value of me doing more, that's fine. But more often than not, it's because they can't get their own staff to pick up the new challenge. Typically that's a result of under staffing.

2. Scope creep. Essentially I'm brought in for something small, and groups are constantly adding on more tasks. When this is combined with the "never ending project" above, I basically become entrenched. I don't mind if it's interesting work, but all too often, after the first few months, I'm doing things that won't apply to any other customer and have stop growing. When I'm on a project like this for 3 times the original duration, I tend to get antsy and weight the cost to the relationship of not signing the next contract to extend. If the work stays interesting, I'm happy to be paid consulting rates for full time employment.

3. The right way. Not many people successfully do this. The thing these customers have had in common is that the staff wasn't overworked and were truly interesting in learning what I was doing and taking over. Also, the work I'm doing typically involves drawing from experience at my previous clients and vendor training. Any extensions are usually to do something above and beyond the original contract, and not to maintain what I've developed.

It's not a bad thing to be at a customer forever if you are always doing something new and doing it faster and therefore cheaper than their internal staff could have done. It's bad when they keep you there to maintain their environment, and it's bad for both the customer and for the consultant, the good consultants at least.