Lumenovis

It’s said that one definition of insanity is doing the same thing over and over but expecting different results.  By that definition most of us are probably a little insane, and most of the businesses I’ve worked with even more so.  I’m going to spend some time over the next few postings discussing some of these tried and true, repeatable methods for underperforming or failing.  The first installment:  C + C = A.

If you’ve been in the technology field for any length of time, you witnessed some variation of this logic:

1. The company has a budget X for a certain project/product.
2. We need as many people as we can get for that budget.
3. Let’s avoid top talent and instead target the market average (or below) to get as many people as possible.
4. Let’s apply the latest hot methodology to produce a great product (a topic for another day).

In other words, I’m going to create a team of C players but expect A results.  C + C = A.

The major breakdown here is, of course, #2: the assumption that quantity begets productivity.  While that is true in some cases (you can’t build a massive, multi-million-lines-of-code enterprise system in a reasonable timeframe with 2-3 sharp developers), it is not true when you measure across quality levels.  Ten C-players will probably not out-produce 5 A-players.  In fact, they might not even outproduce 1 A-player.  If the problem is complex, the C-players may never deliver an acceptable solution.

I’ve seen many variations of these cases play out in the real world.  I’ve seen a large development team shed 1/3 of it’s (bottom ranking) staff and improve productivity by 50% or more.  I’ve seen a small group of A-players produce an order of magnitude (yes, 10X) more features in a given time period than a larger group of C-players.  But most of all, I’ve seen teams of C players produce lots and lots of C results, followed by inevitable surprise and confusion at the management level.

So if it’s clear that, in many or most cases, net productivity improves when you go up-talent, why don’t companies do so?  In my experience, the number one reason is concerns about cost (actual or perceived).  Paying 20-40% more for an A player (vs. a C player) seems prohibitive on a person-by-person basis, but once you look at the ratio of productivity to cost at the team level, it quickly becomes apparent that going up-talent is probably a net cost savings.  If I had a budget of X, I’d much rather hire 6 A players than 10 C players, knowing full well that I’ll get a 2-3X productivity boost even with fewer bodies.

But management (especially CFOs and financial types) generally can’t get past the cost of the individual resources.  Large companies are often driven by the CFOs, who are by and large focussed on raising the top line and reducing the bottom line on a quarterly or annual basis; in their quest to squeeze out all costs, they get a little gassy when they see high-dollar individuals on the payroll.  In short they see top-performers as an expense item, and not as an investment in future success.  Great for the short run; not so good if you want to be competitive 3-5 years from now.

A more reasonable excuse is finding that talent- there are not many A players on the market, and the companies that have them keep them.  But it’s not impossible to move up-talent over time.  Companies that are brutally honest in their evaluations and ones that refuse to keep low-talent can move up-talent over time.  I believe it’s possible to bump up a full grade level within a year or two with some firm commitment.  But again, this is tough.  Companies and made of people, and people live by relationships, and relationships make it sometimes hard to do what is best for the team.  Likewise companies (and their management) like to think they’ve done a great job building a great team (like the old adage about 70% of people thinking of themselves as above average)… deep down many of these managers are resistant to going up-talent.

Another reason is “thrashing”, which results when C players produce a faulty, leaky system, and then massive amounts of manpower have to be thrown at the problems to keep them at bay.  In this case you are caught between a rock and hard place- you can’t shed too many bodies since you simply need numbers to spread them out over all the problems.  Once you’re at this point, good luck.  I’m sure you’ll spend many painful sleepless nights wishing you (or your predecessor) had invested in A players and avoided the problems altogether.

I’m running out of time for this entry, but suffice it to say that there are more reasons for the perpetuation of this insanity, and I see no evidence that it will stop (in aggregate).  That said, there are plenty of exceptions to the rule- teams that have invested in A-talent and are reaping the benefit; teams that are working hard to move up-talent; etc.  Kudos to these teams.  And if you’re on the wrong side of the insanity, just know that it’s never too late start moving up-talent.

By the way, there is a variation of this myth known as outsourcing, but we’ll hit that another day.