Tuesday 13 October 2015

When what people say isn't what they do... (Aka How I escaped a pseudo-Cult)

**** UPDATE: 12th October 2015 ****

This was a blog post I was hoping never to publish. It was something I wrote in April frankly out of rage at the way this organisation was going and specifically on the behaviour of the central limited company in the middle. I wrote this as a cathartic exercise, almost to put my thoughts down on paper after what was frankly a bizarre experience with this central 'hub' of the organisation. The thing that has held me off publishing was that a number of folk within the organisation this is aimed at are good, honest folk. Any negative experiences I've had since are equally likely to have resulted from the middle of the network picking up stuff from one person and making 'suggestions' to another person, which the other person then assumes is their own contribution. We've all worked in corporate environments where ideas are stolen and sold on as coming from their boss or another person. Personally, I don't like those environments. That's dishonest in my mind.

Many people in the network are there in good faith, more or less know what they're doing (which is good enough for most needs), who I've worked with before, who communicate the ideas around lean-agility well, even though their understanding of the mechanisms of operation isn't close to say mine, or other's in the field not within this network. It is the communication that gets the fundamental message across, especially to those just starting off in the Lean-Agile space, not the expertise you have. That is a lesson I am continually learning, especially where there is a significant gap between where I am and where the organisation is.

If there is collateral damage associated with this, then I apologise, but in reality, I am somewhat fed up of my contributions being used without attribution and whilst I have always taken the stance of sharing work, that experience earlier in the year has started me thinking about formally protecting my intellectual property, something I was always hoping to avoid. After the events of this weekend, I am very seriously considering this again.

Written in April 2015

**** End Update ****

For those that have known or followed me for a while, they know I have a fierce sense of justice. I mean really fierce. I don't consider myself an activist, but where I feel it's needed, I stand up and make it count. This happened with the closure of Manchester libraries and of course means I am one of the folk who is not scared to stand up and keep the lean and agile community honest even though I contribute to it. I have no issue looking inward for opportunities to improve as well as being honest to clients and colleagues about how I think things are going, both in the way I see my contribution to the engagement and vice versa. I unwittingly developed this 'perhaps too honest for his own good' stance over the years and am pretty clear with myself on not being a doormat.

I don't believe in sugaring pills or promising things I have no intention of delivering and as an engineer, I find organisational politics dysfunctional and abhorrent outside the need to improve employee relations with each other and improve the flow of work. Anything else is a huge waste of time! If everyone is under the impression everything is perfect when it isn't, the end client not only gets less value than they expect, but also has paid out way more than they should have done! The key to a lot of this is honesty and transparency and as I found out recently, organisations claiming this mantra aren't anywhere close to understanding what that means! Indeed, when you find yourself peeking under the hood of the organisation I've just been booted out of for whistle-blowing, and working through what the concepts actually mean or do, then you more or less lose all faith in humanity.

Network Consultancy Model

Last year, I had the then opportunity to join a new movement. It was a network of contract and consultancy practitioners who wanted to work together to solve client problems and contribute to a better model of consultancy than was on offer from traditional consultancies. At the time, this sounded brilliant! It sounded like it was the catalyst to Stoos that we needed to take it from a talking shop to action. However, my experience of this organisation's model in particular eventually turned sour, even though by then I'd put the proverbial blood sweat and tears into making it work.

Being a new model, it was always risky from a contractor's perspective. Not necessarily because there was maliciously anything wrong per se, just that as a new engagement model, it was just that. New! This means that classical procurement models weren't likely to fit it perfectly, so a misalignment was bound to occur.

I did my due diligence and a couple of things stood out as mildly concerning. For the contractor, the proportion of income taken was a smidgen higher than recruitment agents take. OK, one percentage point in real terms, though on a higher rate, that sounded fine to me. So I signed up and all I needed to do was undergo a recommendation and an assessment. Passed those easy enough.

Initial Conversations

The chap who called me, explained the model. He then sent documentation on chaordic organisations. It was a good read, one I certainly recommend, but I couldn't tell at the time whether or not this was the organisation's material. Indeed, when I asked the chap about it he couldn't tell me much materially about what it entailed. So I read it a bit later and it transpired that it wasn't, as it was a recommendation from one of the existing members (also an escapee I've since found out :). However, as someone who has been responsible for branches of federated organisations for more than 6.5 years, I felt pretty confident I knew how that sort of model worked and in any case, felt I could support the network in making such a model work, even though it was pretty obvious from early on that this individual, the director of the limited company representing the network's core had never even been close to doing this sort of work in earnest before. Other things stood out as more concerning though!

Engagement Method

Firstly, there was no contract! It was called a 'memorandum of understanding' (MoU) which was apparently agreed not to be a legally binding contract between the parties. I've copied the relevant section below:

In addition, this MoU was very sales focussed. Plus, the way the payments worked at the time, you would be charged out at a full rate, the company would take a large percentage to run the network (some 17% of the charge out rate) with a 4% locator/principle fee then on top of that to pay the person who found the opportunity or managed the relationship with the client. The rest was called the booking value and this was sold to me as 'your money'.

From the booking value, which is effectively what you were booked out at 5% would be taken from you (interesting, since it was 'my money') and split into network contribution pots. That 5% contribution would be split:

  • Bonus fund = 17%
  • Investment Pot = 33%
  • Reserves = 33%
  • Blue-sky = 17%

HiveMind pricing model as explained by HMN Ltd  - "it's really very simple"

The only fund you were more or less guaranteed to receive back was the reserves contribution as one of two options were available to you.

Conversations around this would usually continue with "It's really very simple". In sales-speak, this very often means it's about to get convoluted as hell! "It's really very simple" is often an attempt to make the listener feel they aren't smart enough to understand it, deflects any questions and thus need you to explain it to them or perhaps divert tough questions. Consultants seeing themselves as smart, or having enough of an emotional tie to worry about that smart reputation almost become anxious at the prospect of not knowing something. So they genuinely don't ask.

I don't fall for that one and these days I don't care enough about my image to not ask the necessary questions to tease out the details and thus pull sales people up on the rubbish they're spouting (as many PC World employees who have had the misfortune to engage with me can attest ;). After all, in the agile community, we call each other out all the time, which keeps us as a community honest and is a form of informal peer-review. So "It's really very simple" is one of those phrases that should be added to this list.

The two options were:

Option 1 - Leave this 5% contribution in the network and get a proportion back in 12 months.

This gave you the opportunity to get a share of the bonus fund, which was made up from 33% of half of that 5% contribution (still with me?). The reserves making up 66% of 2.5% of it's value you got back no matter what, since that was your money... together with all the other bits that were your money. The blue-sky fund was reserved for a committee to decide what to do with (I suspect market analysts would decide this, since the network was looking to build collateral and the network was very cronyistic in this regard). An investment contribution was for the network as a whole to decide. So we would get a vote on what happened to this investment fund and our voting would be weighted according to the amount of money contributed to this investment sub-pot.

Option 2 - Take the reserve funds out immediately and incur loss of other contributions

If you took this option, the money, your money, would be split in the same proportions as before but this time, the only proportion you get back is the reserves. The investment and blue-sky pots you lose anyway, the reserves you take, with the bonus then being split in half, with half going to the investment pot and half to the bonus fund, neither of which you now have any say in. So the bonus fund and the investment pots go up by a certain amount, which means that those contributing within the network, towing the network line, could get more than they put in and the investment pot is worth more than the collective voluntary contributors.

The aim was always claimed to "keep the network front and centre" of the expert practitioners mind (by basically holding on to a proportion of their cash - keep working or contributing, or else). I knew I was being sold to and I didn't care for the sales pitch. For me, there were a number of folk who had previously proven themselves and I was willing to help them out via the network. After a while of doing some significant work for the network, it became clear there was such a disconnect between what the director of this network hub thought and what it actually is and after a short while, I assumed I would lose all the contribution from the start.

Basic Premise

The MoU implied expert practitioners would support each other and the network. I was fine with that and having worked in many contexts like this, including in the 3rd sector, I was very comfortable I knew what that meant. Indeed, my own company scales that way and I myself interviewed one other person who was very clear on federated structures. These others I was tasked with evaluating and they seemed a really good fit to me, given the parallels in what I understood the model to be, as they also had experience working in fluid organisations. So they were a perfect fit with what this consultancy network claimed to value and the way it aimed to operate. In the end, it became very obvious there was nothing further from the truth!

My First Time...

Eventually, I got my first engagement through this consultancy network. It was pretty cool! The company was Northern Gas Networks. They had been through a massive 2 to 3 year cultural transformation exercise to make them more receptive to innovative ways of working and some of the agile coaching slotted in really really well and delivered significant impact! The teams 'got it' really easily and the consultancy network's expert practitioners on board were a really great bunch to work with! The end client itself was a pleasure to partner in!

As of the year to March 2015, the network and the limited company was almost entirely funded through expert practitioner engagement, not any other form of income. So expert practitioners and contractors funded the network in its entirety.

However, even then, some things didn't seem quite right to me. The first was that the newly appointed Director of Innovation, Improvement and Information at NGN was an ex-HiveMind director. He's a positively passionate guy, always good, who knew the director of this consultancy network's limited company from his work at a big market analyst firm and he released his HM interest before taking up the role not long before I arrived on site. You could argue an element of cronyism and there was a disaster of a situation which if you know the chap, probably wouldn't come as a surprise ;) but given there wasn't a current conflict of interest, there wasn't an obvious problem per se.

The bottom line is he landed on site and expanded HMN engagement by the bucketload! For those of us with experience in agility, we know that you should never big-bang agility, EVER! but that's what happened :(  Eventually it took, which didn't really surprise me given the 2.5 years of work that had gone on way before the network got involved. However, there was this "Black Thursday" incident akin to the banking crash, meaning we all had to go home and some of the network never came back.

Black Thursday was caused by a misalignment with the consultancy model, as I expected earlier. So it didn't come as any surprise to me. I had rejected an offer of a full-time contract with NGN precisely because, at my rate, I'd burn through client cash too early in their agile journey and of course, all eggs-one newly shaped basket is high risk in any case. Unfortunately, other consultants and contractors who were not as experienced in this model had banked their livelihoods on the engagement, giving up offers of traditional, stable contract work to take on the responsibilities in this consultancy. Even recruitment agencies, who I hate with a passion, I've never seen booted out of a client and in-turn have to ditch contractors, though it is theoretically possible. Even during the calls after that event, where the network took stock, I made a point of trying to support others into the organisation first. After all, due to other client work, I wasn't able to be on site and other members of the group had familial changes which meant I felt I had to offer them the opportunity to go in first, so stood aside (that's the kind of guy I am, but also the very reason why I am now a cynical old git, as it's been abused so many times in my career).

The Folk...

I met some good folk there. Really grounded folk who understood agile practise and some who could bridge clients up a little closer into the way I see things (and some of the maths that goes with it). There were a number of interesting and exciting technical aspects, including working in Cloud, building CI, BDD, disrupting the classical vendor procurement models, tracking and planning and of course, Agile-EA.

Chaordic != Hub and Spoke

It became pretty obvious early on that the network wasn't really a fluid, chaordic network per se. In order for it to work, the network has to operate as a series of independent, wholly responsible entities to be confident folk could engage one another. As it stood, this wasn't the case and the weakest link centred around the hubbed payment model.

It worked by clients procuring network units. These units could be cashed in at any time for expertise in either advice or delivery, usually for short-term engagements of no more than 2 weeks. However, at NGN, they basically contracted HiveMind in full-time at, of course, higher than contract rates, exactly like other consultancy services do even if they are not charging as much. This led to a number of issues, including burning through money. Indeed, I felt myself having to say "I think you've got XYZ on site at the moment, you'd do well to speak to them, as if I came in, it would be chargeable".

To me, sometimes it's necessary to reject a client request if it's in their best interests. Give them a phrase to ask person XYZ about, since it was cheaper for them to do that than get me in. Most of the space I deal in is much more specialist than the foundations of agile enterprises. So it's better to get someone cheaper to do the basics than me do that. It probably won't please the network limited company [director] to read this, since it's possible they'll think I've cost them money. But they have appointed others in my place and if they valued what the client actually needs as opposed to what the limited company [director] needs, they'd understand that. However, as part of the network, members would ask me questions anyway, so I knew there was always a chance I'd get an email come back to me about the same thing if more sophistication was needed and I had no issue replying as it was network member to network member, which I understood by the MoU to be 'supportive activity' (i.e. 'free'). I hope it was valuable for those I've helped.

Introductions & Initial Role

However, the next bit was mildly concerning there was suggestions that we introduced the network to out existing client base. In itself, this wasn't a problem as long as I got the impression that the 'business development' folk would manage the relationship correctly (read 'sales' - since in the main they were and despite the 'partner' name in their titles, shareholding and control remains under the one director as of April 2015 - More on this later). Every consultant has a particular style and not every consultant will fit into every situation like a glove. Mine is founded on competency, honesty, transparency and pretty much zero selling shpeel in that order. It transpired over time that the network's limited company values were almost exactly the opposite way round to the values they claim to espouse, and dare I say, convinced others with even if the expert practitioners inside the network were themselves aligned to the way I saw it.

However, during my engagement at NGN, it became clear that there were folk who were not on the same page as the rest of the network. They would talk about one thing and do something completely different. In addition, whilst the majority of the network was trying to take NGN in one direction, towards a DevOps type team, it became clear after going to a number of this network member's stand-ups that they were really struggling with the concept of agility. Indeed, they reverted to type and started appointing SysOps personnel when NGN needed to recruit those with DevOps experience! Part of that was the way that the Director of Innovation split the work-streams (note this last line highlights the problem - it's not a self-organising team if someone outside the team is organising it), which then pushed HMN folk who aren't confident in accelerated delivery into a siloed frame of reference, which is that one person's particular comfort zone. He entrenched after that, despite playing the 'move cards on a board' game.

This member's activity was and is totally tangential to the way NGN were heading elsewhere and taking such an approach usually results in folk who are silo-thinkers being appointed, especially in the more senior roles, due to homophily, who then dig their heels, keep thinking big-bang and never change, putting the organisation at huge risk! This sort of silo, big-bang thinking caused a 36 hour downtime at Laterooms.com when they needed to move data-centres. It nearly brought the company to it's knees. So having lived through that and watched a number of other companies go through it in my time too, despite my protestations, I can see that car crash coming a mile off! If companies value their existence, they have to adapt to remain robust and competitive! This person solidly failed to do that, paying lip service to the network and it's membership's experience, yet in-line with the limited company director's stance.

This same person was harvesting help and knowledge from everyone. He was also put in a position of hiring and firing service desk folk at the client organisation and operates a model wholly inappropriate to the rest of the organisation which was set up by the rest of the network of practise (but he said the right words, right?). Indeed, this person has ultimately put me in a position of professional reputational risk which eventually manifested. Given how much time this was taking from me, I got the impression that I was not getting as much support as I was putting in to the network. In addition, that person made me look foolish in front of my contacts, despite asking for my help and advice and that of others in the network. Needless to say, I am disgusted with that individual! Together with a number of other members, he is now longer part of my business connection network. I couldn't possibly recommend him to anyone, despite (or perhaps especially because of) the names on the CV!


Black Thursday 

The new ex-Gavtnor (names changed to protect the innocent) director at NGN, managed due to his lack of focus on governance, to put both the client and the network in a position of substantial compliance risk. That was an 'I told you so' card moment for me. Indeed, I remember that day well as I was on-site. We were all pulled in to then get kicked out and HiveMind network engagement suspended, despite the attempts of the individuals and aides inside the client attempting to reign his spending in. OK, perhaps a bit of carelessness there, ignoring compliance rules and GRC and of course, even if everything was done right, there was always the risk of an ill-fitting relationship because of the new(ish) type of model the network worked under. That latter risk became an issue and it saw a number of folk who had dedicated their entire professional base to the network, including the income, suddenly out on their feet with zero money.


Market Analyst Cliques

This became one of the most perturbing of the lot for me. A number of the members of the network were marketing analysts. This in itself was no bad thing to have on board. However, most marketing analysts don't have any solid research experience. A number are ex-journalists who aren't statistically minded, conduct surveys and just report what they say (a la Survey Monkey - my past administrators have done that), without a more solid approach to analysing it in context. So they comment on market trends or perhaps 'consult' to C-Suite executives, despite never themselves ever having done such work, managed such work or sometimes even knew anyone who does such work.

Fortunately, this is the great opportunity this consultancy organisation has! To fill this space with people who have both the skills and the strategy in one. Imagining how much faster, more reliable and more informed organisations could be if the people who drove strategic technical direction could actually do the work (or vice-versa)? They can both be guided by the risks and issues inherent in the enterprise as it is now and also guide the direction of the development/change. After all, a vision is just a point in time and space. To get there, you need direction and to beat your competition, you need speed. You can't figure out direction without knowing where you are (the bit most strategists and many analysts are missing) and you can't figure out where you are going if you don't look up (the bit most contractors and many practitioners are missing). So the meld has the potential to be amazing, but equally, it has the potential to be destructive and conflicting if you get the wrong sort of leadership. Alas, the organisation has the wrong sort of leadership, who prioritised the wrong relationships, especially considering where the money is coming from. What organisations are actually valuing.

The consultancy's limited company network claimed to value this. The problem is yet again, what the network's limited company director said and what was actually happening on the ground, were completely different things. In addition there was very clear favouritism towards the analysts, especially those the directors worked with in the past (Trust? This bit is fine) to make decisions in areas well outside their speciality (Trust? This bit is NOT!).

Marketing analysts contributed very little (nearly zero percent) to the income of the limited company and the network. In addition, a small number of the analysts network had become 'partners', though this appears to just be title, since the limited company retains it's single directorship.


Sweat the BIG Stuff!

The limited company had a habit of increasing the take from the expert practitioner side of the relationship. In my 12 months, the prices increased to the expert practitioner twice. The second time by 50%! This was to pay for folk the limited company brought in to pretty much buy a foot in the door of other organisations. One of the values the network espoused was skills over seniority. This was probably the biggest violation [read: lie] that I saw of this value. The funds were taken from everyone else, to pay for one or two people of higher seniority. If the prices were put up to the customer, as apparently Gavtner do by (conveniently) the same amount, at apparently the same time each year, it would show value to the network. However, it wasn't, so the limited company director proposed the disadvantaging of all the network's expert practitioners for the benefit of a very small few. Indeed, such a capable salesperson that he is, he more or less convinced the room that gathered at an away day that this should be it.


Know your competition

A month or so ago, I was in a discussion about recruiting more expert practitioners. I was shown the sales Trello board, which was a pipeline each person was taken through before they were then inducted as a member or potentially, they leave the process. At the time, there were a number of folk who had rejected the network in favour of contracts through traditional recruitment agencies. There are around 3,500 agencies in the UK and that number is growing all the time. Whilst I hate them with a passion, I stated to HMN during a call that HMN are competing with a traditional player in a traditional, established space which people know and have worked with. The new model will not find itself easy to compete with it in both recruiting experts and selling itself to companies if it doesn't aim to address the concerns of those experts who have a route that works for them, including the ones who respond to tenders for their work, including percentage of take-home pay (with reference to the events above). After all,why would they open up HMN to a process they've been through and have already won, instead of recruit directly through agencies at market rate or better still, access their own network without having to pay HMN a bean? Makes no commercial sense for those types of expert to do that.

HMN runs a series of Grades. The grade one was placed at in the network was determined by the individual at the beginning. Very often, individuals, especially ex-contractors, under-position themselves, because they are used to the contracting model and know their market worth. Contrast this with with consultants, who over positioned, by far in some cases. What this does, with the proportion taken by the network (at up to 23%) permanently or temporarily, is place them in a position under what a recruitment agency would give them (who takes 15% - 18% of the engagement value). So naive contractors moving into the consultancy space would actually place themselves well below market value. 

Simplicity.. or not?...

For example, if a contractor is normally on £350 a day, the client would be charged £426.80 via a recruitment agency at 18%. That's easy.

At HMN, the contractor would state "£350 a day". You'd be matched to a grade, more often than not, falling between two grades, so they'd offer to give you the higher level ("Woohoo! I like this network" you think). 17% is added for the network costs, and up to 6% taken by the network for the engager (it was 4% initially. The image above was taken whilst the new 6% cost was being explained and specifically, where the extra 2% was going to come from). The person who brought you on board. which let's say takes you to £356 a day, which means they're booking you out at £462 a day. Note, the £462 a day is the important number here, not your £356. In any case, great!... Unless you're the client, in which case you're already paying more for the same resource. No problem! The network units you get can allow you the flexibility to chip and change. That's the USP.

However, then comes the sting. Your £356 is then split further into 95% and 5%. That means your immediate contract rate is 95% or £356 a day, which is £338.20. With the ability to get another £5.87 in 12 months time (plus tiny bonus contribution). If you were on £350 a day and you took 5% of your revenue and put it in a savings account, you'll get just under 2% after that time. In either case you're taxed on it, but you get some income from the savings account.

If at this point you're thinking "Eh? I thought I was contracted at £350 a day!" I wasn't, but that's nly because my math is pretty reasonable. Indeed, I ended up writing the paper they use for the weighted voting rights based on this and also the Google and Excel Sheets used to calculate them. These are accepted as a true and accurate record. So I'm pretty sure I know how this works :) I solved this by pushing to get put at a higher grade. After all, the higher the grade, the more they get anyway. 

In any case, many contractors didn't. That concerned me a lot, as they were lulled into this false position of benefit. However, they are adults and can look after themselves, whatever empathy I may feel for them.

Despite this, you had the potential to prove your increased worth. Indeed, my grade was upped twice in the time I was there, so it wasn't impossible for you to level the playing field.

I made a point of stating this, especially as the network aimed to grow and also started charging us more. However, we only have (had) one paying client, who agreed to our involvement and were, let's just say, "receptive" to us being there, for reasons mentioned earlier. They are a beta-client, so there were going to be teething problems, but there would be a favourable review at the end of it (apparently contractually negotiated - though I never saw the paperwork) and of course, the director of innovation at NGN was in a position to bring more folk in.

[Partial] Conclusion

There is just far too much to write down, so I'll continue to write them when I need to purge. There are questions that need asking about some of the awards that were presented to the end client. The actions of the interim service desk manager (the SysOps advocate) placed by HMN who put my reputation at risk (I'm perfectly capable of doing that myself thank you very much). The under-appreciation of some of the other folk HMN placed there who were worth way more than HMN were paying them. There is also a question about the investment pot and how that works and how much of that could ever fall into the remit of the FCA, though I don't expect that latter one to be a concern given the positioning of it, but I am no expert in financial legislation.

I learned a lot about people during this period and truth be told, I just want to move away from people like that. They also employ many approaches I've even seen bullies in the workplace use to push out introverted folk or manage out 'impassioned experts with integrity' when ironically, those are the folk who can make the network, work. Who keep them honest and are honest.

Towards the end, the whole process became quite abusive. Not being the sort of person to sit back and take stuff, I gave as good as I got (and more I hope #ThugLife). Professionalism? Well, remember, a network is a series of relationships between people. Hence, they are my client as much as I am theirs. After all, I pay them a unit of cash. I don't have to choose that network. I can bid and get work and I can start up stuff (all of which the 'business development' department - read sales - wanted me to push them into). Though as you can see, the experience burnt. Some might call it 'disgruntled employee syndrome', which is a nice way to minimise or invalidate the experience someone has, or some might see this as a useful indicator to what to expect the network to be like (if it's like that when they join, I have no idea where it will go).

The introverts are almost always the ones with the real, true expertise and smarts. The cross functional, multidisciplinary folk who make stuff work. But it's clear the way it's structured isn't about delivering smart people. 'Smart' is just a word that salespeople use to court both C-suite executives and directors and other smart but gullible or "innovative" people into the fold, to try and get enough of a base of resources (which is what they consider experts to be - resources) to work with. So ironically, from a position of sales, the very thing that makes me so angry about that HMN director is also his greatest and dare I say, hyper-popular asset. He can sell anything to anyone...

...except me and those who see through him and know what they're doing.

If you don't like that sort of thing, assume every single thing that comes out of his mouth is a sales ploy. He's watching or listening for cues all the time (which all capable sales people do). If you want to use him as a resources, that's cool, but make that clear from the start, otherwise he owns the relationship, which is the default position by the way he recruits and pays you, as it's funded through his company and the cut is taken first (as opposed to you paying him after the fact).

No doubt this will be a 'teflon shoulders' moment (nothing will stick and he and others are adept at moving the network hub away from criticism). So I don't expect any of this to make a jot of difference longer term to the poor suckers who find themselves in it. Indeed, I also expect I'll be out on a limb, as there will be next to no support, but that's not a position I care much about. Indeed, I bet some of the work I did and the material I contributed will be resold as something else. After all, if I'm not in the network, they won't attribute, even though the lack of legally binding IP specification means I still hold mine.

God speed all who remain. Some of you will get the impression things are rosy, but again, unless you've sat where I've sat, you'll have no idea that it's all a ruse!