In the application delivery domain, there are four basic sourcing models or patterns:
Permanent – the team is composed of permanent employees
Contract Staff Augmentation (onshore) – the team is composed of some mix of permanent employees and local contract staff hired by our managers.
Outsourcing (onshore) – the team is composed of contractors from the same firm with their own embedded leadership that chooses their own team either on premise or off premise as agreed.
Outsourcing (offshore) – the team is composed of contractors from the same firm with their own embedded leadership that chooses their own team usually the majority off-premise, off-shore with some on-shore, on premise presence as an “interface” layer.
In each of these patterns as we progress from permanent to offshore the domain knowledge of the developers decreases. With this decrease in domain knowledge, greater rigor in communication and documentation are required. Our staff, know the user base, may have personal relationships with people in the user community. If they have been around for a while may have knowledge of our other systems and data. They know our practices and challenges. Contract staff may acquire that knowledge over time, but they are not incented to retain it. If they think they might be converted to permanent employees, they have at least some incentive to acquire knowledge, otherwise, they are incented to learn only the technical domains. Once off site, even the learning that contract staff do is third hand information and much is usually lost in translation.
In each of these models, we progressively delegate leadership and support services as well. We don’t provide benefits for contractors (temps), only wages. In the outsourced model, we have delegated hiring and onboarding as well. Often outsourced groups will come with their own embedded leadership (tech leads, project management etc.).
As we progressively delegate leadership and remove the incentive for the resources to gain domain knowledge, we must increasingly develop an interface layer to support the project. Our staffing model must change to contain more leaders, connectors, communicators than actual doers. Our people must become more accustomed to running process and maintaining accountability – for developing the standards by which the output of others is reviewed. The implication of this is immense from a time span of discretion perspective, as doers may work on tasks that have a week duration, their time span is based on task-cycle duration so have to think a week or two ahead, a stratum 1 requirement. Those who hold doers accountable begin to have that are more dependent on process-cycle than on task-cycle. That means if your life-cycle is phase gated, your time-span of discretion is measured in quarters not weeks. These leaders have to think through how to build interim check points within the natural flow of each phase to maintain enough information to develop meaningful status. This could be a stratum 3 requirement.
Using incremental, iterative, or agile life cycles reduces the time-span of discretion, but if our teams weren’t accustomed to these life cycle when they were doers, they will certainly not be comfortable leading others in them. Introducing a different life cycle for projects is a business change program that requires significant investment to get value and to make stick.
I firmly believe that this is why so many outsourced and off shore projects return such dismal results – because we as senior leaders have not properly laid the groundwork for success starting with ensuring that we have the right internal staff and leadership model before we start moving the work away. We end up feeling like a runner in a marathon who has never run more than 10k before, completely unprepared. The best we can hope for is to finish the race, completely unconcerned with our position or time.
It doesn’t help that many of our consulting partners are happy to take our money even when we are unprepared to run a successful project. They are usually happy to tell us about all their successes, but not as much whether we are organized or staffed in ways that will make us successful. To a fool and his money, they say “Caveat Emptor”.
It’s not that I don’t believe in alternative staffing strategies. I do. I think every staff model above can be very satisfactory and successful. But it is incumbent on leadership to treat a change in staffing strategy like any other business change program. So often we just see that others are doing something, and attempt to adopt their methods without understanding what made them successful. We may also not recognize cultural differences between organizations that made immense differences.
As you evaluate staffing options, it is important to think about the different requirements each places on leaders from middle management down to the day to day tactical leaders interfacing with consulting partners and their agents.