Office Politics – Page 57

Unkindest cut

At least a dozen different people have, in correspondence, endorsed an alternative to bailing out AIG: Instead we’ll divide the $85 billion evenly among the 200 million adult U.S. citizens, giving each of us $425 thousand.

Other than the misplaced decimal point this would be a fine idea: The correct division of spoils is $425.

The economy has, in the words of Ambrose Bierce, an “implacable aroma.” The impact on your IT budget is a predictable, if misguided desire for panaceas. CIOs should plan on thinner budgets, demand for more services, and insistence that these two requirements are entirely compatible.

There’s no point in arguing, either. Those who insist will have both the authority to do so and the desire for it to be true. It’s a lethal combination — neither facts, nor logic, nor shouting at the top of your lungs will result in any discernable dissuasion.

You’re in danger. It’s time to dust off a basic rule of responding to requests: Both yes and no are bad answers — in this case because one admits incompetence; the other is insubordinate.

Answer yes and you’ve admitted to having run a hopelessly inefficient IT organization for lo these many years. If that weren’t the case, how can you now find the efficiencies necessary for delivering more for less? You’re dead.

Answer no and you’re disobeying a direct order from the person you report to. That’s generally a very bad idea. (Yes, I’m stereotyping CEOs. Some are quite reasonable and won’t put you in this situation. This type of CEO is terrific to work for, but quite useless as a rhetorical device.)

Your alternative to yes and no is, as always, “here’s what it will take.” You can get from here to there, but not for free. Some alternatives will require investment; all will have risks attached.

Investment and Risk pay for your ticket out of Can’t Win Land. They explain why you haven’t already done whatever it is you have in mind, without you looking like a slug.

Now all you need are the ideas.

Here are some starters. See if you can spot the risks (add a Comment below this column):

Increase trust: Distrust is expensive. It’s a luxury distressed companies can’t afford. Specifically, distrust drives unnecessary rework. This increases unit costs, lengthens cycle time, and decreases throughput in any process where it plays a role.

Increasing trust is far from simple. Distrust exists for a reason, and there’s no simple recipe for overcoming it. The chapter on Building and Maintaining Teams in Leading IT: The Toughest Job in the World provides some useful techniques, but it’s hardly exhaustive.

Managing the interpersonal dynamics among employees to identify and address dysfunctional relationships is a core leadership responsibility. Focus on it yourself, and insist that the managers who report to you focus on it as well.

Cut meeting participation in half: Many consider all meetings wastes of time. It might be true of some, and possibly most meetings in your company.

The challenge: You don’t know if they’re wastes of time because they aren’t needed or because, while needed, they aren’t run very well.

In my experience, most meetings are convened for good and valid reasons. Also, most have more participants than necessary, primarily due to distrust: If someone isn’t personally in the room, that person doesn’t trust those who are to do a competent and unbiased job.

Increase trust and you can probably cut attendance at the average meeting in half, freeing up all of those hours for other work.

Do something about negatively productive employees: Employees fall into three clusters. The first, and biggest, consists of those who put in an honest day’s work for an honest day’s pay and deliver acceptable, workmanlike results.

The second consists of star employees. These folks aren’t twice as productive as the first cluster. They’re an order of magnitude more productive.

Then there’s the third group — employees who not only fail to deliver useful results themselves, but who interfere with everyone else.

Getting rid of these employees is a triple win. First, you save their salary. Second, since their productivity is negative, their departure increases average productivity.

The third benefit? These folks spread distrust the way a manure spreader spreads … well, manure. Get rid of them and the level of trust among those who remain will almost certainly increase.

Krell-o-nomics*

In the first presidential debate, the candidates vied for primacy in foreign policy expertise by demonstrating their ability to pronounce the name of Iran’s president, “Ahmandinejad.”

I call it a tie: Both successfully managed all five syllables enough times to prove it wasn’t just luck. It was almost as exciting as a spelling bee, although with fewer surprises.

Speaking of current events, last week’s column explored some of the lessons IT can apply from the current financial crisis. After these last licks we’ll take a break from breaking news for awhile:

It’s never quite that simple: Last week I said wishing doesn’t repeal arithmetic: “Aggregating a thousand loans, each with a one percent probability of failure, creates a very safe investment. Risk calculations don’t work that way, as anyone who has taken Statistics 101 knows.”

The real problem requires Statistics 201. As several readers pointed out, the risks of the thousand loans are correlated, so as mortgages started to default they crashed housing prices, causing more defaults.

Kevin O’Donnell drew the Lesson for IT: When performing a risk analysis, ask yourself, “What could make several of these things fail at the same time?” Don’t put your backup server on the same UPS (better, don’t put it in the same data center).

And ask your multiple ISPs about facilities sharing. Some Silicon Valley companies have spent painful hours out of the eMarketplace because their risk management plan arranged Internet access from two separate providers . . . who shared the same pipes.

Know your sources’ biases. In a recent story about the crisis, The Economist called the financial sector “the economy’s brain.”

Brain? Id is more like it — uncontrolled “I want what I want when I want it” behavior. As Freud might have explained, every id needs a superego to keep it in check.

The Economist has, for all its strengths, a clear regulation-is-bad/private-enterprise-solves-all-problems slant. Hence the overly flattering “brain” metaphor.

Lesson for IT: CIOs need to analyze the bias of every source of information they use (except, of course, Keep the Joint Running, which is unfailingly objective in its accounts of things).

Those with no skin in the game break the game. Deep down in the core of the financial meltdown lies a very soft bedrock of bad mortgages. They were sold by companies that didn’t care at all if they were good mortgages. They sold the paper and moved on to the next borrower.

My business partner suggests a regulation requiring mortgage originators to hold every mortgage for three years before selling it. An alternative: An outside regulator selects five percent of the mortgages sold every month at random, to be serviced by the mortgage originator for the life of the debt.

The result: No underestimated risk, no “liar loans,” no financial meltdown.

Lesson for IT: Give the rest of the business a direct stake in the health of the IT organization and the company’s technical architecture. This isn’t easily achieved, and the most common tactics — IT treating the rest of the business as its internal customer, and charging back for its services — achieve the exact opposite result.

Urgency isn’t crisis. In a true crisis, speed matters most — any decision now is better than a perfect decision too late. When the situation allows for thought and debate, thought and debate are worthwhile investments.

Treasury Secretary Paulson’s original “plan” was, at three pages, shorter than my consulting company’s standard contract, even though the immediate crisis had passed and the situation was merely urgent, not critical. No matter what happens next, I give everyone … including Paulson … credit for thinking, debating and compromising, instead of acting like the crisis is still unfolding.

Lesson for IT: Autocracy works for crisis and art, and I’m not that sure about art. When a decision is important, find ways to involve smart people in its making.

Every boom ends. Even booms that aren’t bubbles eventually come to a close. And yet, company after company … and individual after individual … rely on the money being real and the income sustainable. So when one, the other or both go away, the results are catastrophic rather than inconvenient.

Lesson for IT: Use temporary corporate affluence to invest in sustainable improvements, not in expansions of service.

Lesson for those who work in IT … and everyone else, too: When you’re making good money, put enough away that if you find yourself unemployed, or needing to walk away from your job for any reason, you can.

Fail to do so and you’ve given up control of your own life.

* In Forbidden Planet, the Krell succumbed to “Monsters from the id.” Rent the DVD. It’s old, but the special effects still hold up and the plot is remarkably sophisticated.