Managing your partners
SEP 30, 2007Next time you’re revising your employee share options scheme, spare a thought for the people who work for your outsourcing partners. You may not actually employ them – but you might get better results if you start offering them similar incentives to the ones you give your own staff.
Earlier this month I caught up with Tarun Upadhyay, a member of the senior management team at GlobalLogic. The company provides outsourced software product engineering services, working from headquarters in the US and development centers in India, Ukraine and China. It positions itself as an infrastructure provider, effectively operating as an offshore subsidiary handling the heavyweight coding and management of software development projects. For IT start-ups and mid-stage companies in the UK, US and anywhere else where the people-related costs of software development are becoming prohibitively high, this kind of offshoring is an increasingly attractive option.
What’s particularly interesting about GlobalLogic to companies outside the IT sector is its business model, which it describes as ‘second generation’ outsourcing. Upadhyay argues – not unreasonably – that to strike an effective outsourcing arrangement, organizations need to abandon the traditional ‘them v us’ mentality, and approach the business relationship on the basis of building a single team. If the first generation of outsourcing was all about keeping the service at arm’s length and having work delivered, he says, the second is about making it completely transparent.
What does that mean in practice? Well for one thing, you need to stop thinking about the outsourcer’s employees as contractors, because that pretty much guarantees any team chemistry will fizzle away. Regardless of where its outsourced staff work – and the GlobalLogic model does require organizations to deal with some pretty hefty time zone differences – it wants its customers to treat them in the same way as they do their own employees. This is not just about putting them on the employee email list, although that definitely helps – it’s about the fundamentals of people management. GlobalLogic invites customers to do joint performance appraisals of its own employees, for example, and gives customers a say in how much bonus each employee gets. In fact, several companies have gone as far as handing out stock options to the outsourcer’s staff.
“This does require people to modify their culture and processes and how they work,” Upadhyay points out – and he’s right. Outsourcers have long argued that successful business relationships are about far more than striking a Service Level Agreement and dishing out blame – they're much more about working as a team and tackling problems together (and then dishing out the blame...). If you want everyone to pursue the same goals, regardless of who actually issues their paycheck, then treating them all the same way is a good place to start.
Recruiting and sales
SEP 20, 2007Dan Marionni, vice president at the national recruiting department of Morgan Stanley, has a pretty convincing business case for investing in recruitment software. Every time the company’s Global Wealth Management Group misses out on hiring a good quality financial advisor, there’s a revenue opportunity loss of $500,000.
That probably helps explain why Marionni was able to get senior management sign-off for a project to build his own recruitment system – and intriguingly, to base it on a product that was originally designed for something else altogether. Despite the large number of specialist recruitment applications on the market, Morgan Stanley chose to customize software from Salesforce.com, one of the best known suppliers of sales automation software. The vendor’s customer relationship management (CRM) software also happens to be one of the leading hosted services on the market – which means that rather than installing and managing the software in-house, Salesforce runs it for you on its own servers, and you access it over the internet for a monthly fee.
Webster Buchanan Research has long argued that customer management and employee management share a lot in common. In fact, recruitment is best thought of as a sales and marketing activity – it’s about identifying the best candidates, getting them to listen to you, and convincing them that your organization is the best place to work. We’re not alone in saying this, of course. HR guru Dr. John Sullivan is a strong advocate of the same philosophy, and it’s an argument that was put forward convincingly by another Salesforce user, Electronic Arts, at the service provider’s annual conference last year. The fact that two sizeable companies have chosen a CRM platform to run recruitment doesn’t imply a sea-change in purchasing patterns, of course, but it does reinforce the remarkable similarities between the two disciplines.
Marionni told last week’s Salesforce conference in San Francisco that the company had been struggling to recruit two years ago, a time when Morgan Stanley was going through a high-profile period of management turmoil. With a headcount of 8000 financial advisors and representatives, its problems were exacerbated by the fact that most of its systems were paper-based. According to Marionni, the company had a limited view of the recruitment pipeline, which wasn’t being consistently monitored or measured. Its branch managers weren’t well connected, which meant more than one of them could end up targeting the same person, and recruitment data resided in silos. And the recruitment checklist – fairly essential in a regulated industry – wasn’t electronic.
Marionni’s team took around 50 days to customize, pilot and roll out a recruiting application based on Salesforce. Now, the hosted software manages the entire recruitment process from initial lead to the point of hire, when data’s transferred to the HR system – similar to the set-up you’d choose with any other best-of-breed system. And most important, the company has 90 percent user adoption. That’s partly helped by a consultative approach – Marionni says his phone rings off the hook with calls from branch managers, and one of his key takeaways is to listen hard to the business managers who do the recruiting. But it’s also partly down to the opposite – good old-fashioned discipline, based on a policy that “If it’s not in Salesforce, it’s not real”. Whether you choose CRM software, a specialist HR application or a broad-based HR suite to manage your recruitment, getting tough on standardization usually helps.
Social networking for the office
SEP 10, 2007If you’re wondering whether social networking, blogs, wikis and the other tools of the ‘Web 2.0’ world really have a business application, take a look at Pfizer. When a blue chip company in a heavily-regulated industry starts experimenting with different ways of working, it’s probably time for the rest of us to jump on board.
Last week’s Office 2.0 conference in San Francisco was testament to just how far the latest generation of web technologies is creeping into the workplace. While most mainstream media interest has been on the power (or pointlessness) of blogging and the explosion of social networking sites such as Facebook and MySpace, a whole generation of business-driven software services has been evolving in the background. Like the Web 2.0 world, Office 2.0 is all about hosted services, a set-up where vendors run applications on their own systems and users access them over the internet, usually for a monthly fee. And like its consumer equivalent, it’s home to a combination of global software giants – including the likes of Google and enterprise software vendor SAP – and humble start-ups. The hope is that by adopting new kinds of web-based tools, organizations will be able to share knowledge, communicate and collaborate more effectively (see Social networking at work).
Many of these initiatives start relatively modestly. Take Pfizer, for example. Simon Revell, who along with Scott Gavin is a driving force behind many of the Office 2.0 initiatives at the pharmaceutical giant, told last week’s conference that he was driven by sheer frustration at the communications problems that blight every business – like having to wait for a meeting or discussion with your boss to get things done, or finding things that really matter getting buried or lost in someone else’s inbox. After attending the World Wide Web conference in Edinburgh, he wrote up his notes on the conference online for internal consumption and was taken aback by the volume of emails it generated, largely from viral distribution. Gavin and Revell subsequently set up a blog that’s now become a hotbed of ideas - and with 400,000 hits and a senior management following, it’s also secured internal funding.
Since then, they’ve been promoting the whole Office 2.0 – or Enterprise 2.0 – philosophy at Pfizer, arguing the case for
Gavin and Revell’s philosophy is summed up in Meet Charlie, a slideshow that’s rapidly gaining cult status among those in the Office 2.0 field. It explains how the fictional protagonist Charlie has gone from a world of Microsoft desktop tools – like Word and Excel – to hosted, collaborative services such as Google Docs and Spreadsheets and Linkedin. It’s worth taking a look – if only to see how a sense of humor makes new technology applications far easier to get your head round.
About 'The People Perspective'Keith Rodgers is co-founder and content director of Webster Buchanan Research. British-born but based in San Francisco, he comments on Human Capital Management issues on both sides of the Atlantic for an audience of senior business managers.
The People Perspective is all about the practicalities rather than the theory of HCM, but with a bias towards organizations that push back the boundaries. From management strategy to the technology that supports it, it covers the business of acquiring, retaining, managing and developing human capital.
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