According to the Kansas City Business Journal, 40% of US Professionals want to quit.  Wow.

But lets turn out attention to why so many professionals want to quit: their employers view them as a liability rather than an asset (read the article, it is there, between the lines). And with all the layoffs over the last 18 months, there’s more work spread across fewer employees.  In an environment of more work and stress, and fewer bonuses and benefits, we can understand why people might want to quit.  I’ve heard people say that someone should feel lucky to have a job- but equally, the employer should feel lucky to have their employees stick with them through hard times. It is, after all, your best employees who can still leave when the economy is down, and find a new job.

In another post, I tried to explain the dark side of the staffing service “body shops” out there: BPM experts are not a commodity, despite their best efforts to treat us so.  The big staffing firms I previously wrote about are also not committed to their people in any meaningful way.  When a project kicks off, the firm staffs up via hiring and contracting. But what happens when the project is over?  At these big firms, they just let go of all the people that can’t immediately place on another project.  People aren’t an asset to these firms, they’re a liability:  An obligation to pay salary and benefits. This is especially true of firms based outside the US who  leveraging local resources on a temporary basis (the locals are staffed up and down for each project independently in many cases).

We recently reached out to colleagues from a previous project – and we weren’t going to be surprised if they weren’t still working with the same customer.  But you could say that we were surprised they didn’t work for the big consulting company any more.  You might be thinking, sure, some low-level programmers got let go when the project finished. But no.  We’re talking about the people who were entrusted with running the project and managing the customer relationship.  Rather than leveraging their talents in another project, they were shown the door.

It must, at times, be hard for people who work at Fortune 500 companies, with a wealth of people walking their halls that have worked more than 10 years at the firm to understand the amount of turnover that happens at a typical big consulting body shop.  Or to understand how these firms put their teams together on short notice, and disband them equally quickly.

As a small firm, we sometimes have to hire talent to meet the demands of a project, but we’re hiring talent to reach a new plateau, and we’re taking on a commitment to continue their employment beyond just the project (otherwise, we’d just offer a contract).  We just celebrated a colleague’s one-year anniversary at BP3, and he’s about to embark on his 4th project with us.   And it isn’t a burden to pay salary to these employees. They’re our only real asset as a firm – their knowledge, experience, and commitment to our customers.

I hope in this time of economic turbulence, more employers will realize how much their people mean to their success.  And I hope we never forget that at BP3.

Great post by R “Ray” Wang on Enterprise Irregulars about building a “Star Analyst” Firm.  While it is targeted at star analyst firms, most of the points apply well to any services firm that intends to trade on the idea of being “stars” in their requisite space. Tenet #1:

Almost everyone I spoke with began by saying, “Start with star talent.  Don’t make compromises on B-players.”  Then they added, “Most will fail to keep this up over time because the firm gets greedy and focused on leverage instead of client quality.  Keep in mind, if you lack stars, you won’t attract stars.  Set high standards for recruitment.”  The experts are right.  Buyers, sellers, and the media have to recognize your team as market leaders.

I couldn’t agree more.  It is exactly why, when we started BP3, that we started by thinking about who we wanted to talk to and build our team with.  It is also why we focus on what Ray refers to as “Star” potential.  Lombardi used to refer to these people as “heroes” – the people who could do it all: technology, process improvement, coaching, and thought leadership.  There was also a note about alumni.  I agree with Ray that it is important to recognize that people will leave over time – and to keep in touch with that alumni network.  By taking an active role in two previous employers’ alumni efforts, our business at BP3 has benefited directly and indirectly.  Of course, that wasn’t the goal, but it was one of the side-effects.

Mike Gammage posts the question:  is BPM ethical?

Against this background, the hard reality is that the business case for any significant BPM project is almost invariably based on job losses.

The jobs may be lost through automation, or through productivity increases.  The BPM project will typically enable the same work to be done by fewer people.  More positively, the BPM project may enable the same people to do more work – that is, there are no jobs lost immediately.  But, even so, the societal effect is not dissimilar because economic growth will now create fewer jobs.

Put crudely, and for the sake of this argument, BPM seems to be a job-killer.

Now I believe, as will many of you, that work is about far more than simply generating wealth and meeting basic needs. Work provides each of us with a role in the community, it enables us to develop our talents in service to others, and to contribute to the advancement of society.

So it’s a serious question that deserves attention: Is BPM – my work– ethical?

I commend Mike for undertaking a post on this subject.  I have a few thoughts for him to consider when he returns:

1: Competition is the Job Killer.

The first thing to realize, is that BPM isn’t the job killer.  The job killer is the competition for your customers. If you can’t win that competition for customers, you will have a massive dislocation of jobs.  That competition is faceless and unrelenting, unfortunately.  You don’t get to look into the whites of your competition’s eyes and try to agree on a reasonable pricing model – if you do in the US, it is called collusion or anti-competitive behavior (there are similar rules in other locales).

So you have to invest in improving the cost structure and performance of your business, in order to remain competitive.  BPM is a tool to do that.  Just like Microsoft Word and computers put a generation of typists/secretaries out of work, BPM and other software will put a generation of manual paper-movers out of work (or copier repairmen perhaps?).

2. BPM can Save the Jobs of the People you know

A Good BPM implementation can save the jobs of the best people in your company.  By making each unit of work more valuable, it is easier to justify paying them, even increasing their pay.  You’re increasing their economic value add to the system.

Moreover, if the people doing the work become the people improving the work, they can really maximize their positive effect on the business. It also frees up labor to focus on other value-adding areas of the economy (though, I’ll grant, that is an easier macro- than micro- argument – individually not everyone can make the shift, and not everyone has the savings to bridge the gap – which is why I’m a big fan of unemployment benefits and insurance).

Finally, if you can sell the value of these process improvements to your customers, you can actually use process improvement as a way to increase your top line, not just your bottom line.

3. Manage for More than one Bottom Line

BPM and the like can help you achieve more than just cost savings – BPM can help you more reliably achieve any outcome you set out to achieve – higher customer sat, a higher net promoter score (NPS), reducing impact on the environment, increasing customer lifetime value, etc. This is sometimes called the “Double Bottom Line” or “Triple Bottom Line”.  But realizing that your business is about more than just money, why shouldn’t you use process improvement to increase your odds of hitting ALL your business goals rather than just some of them?

Although BPM causes us to examine what we do, and second-guess the positive outcome, I believe overall it is not only ethical but necessary.

Inc. has a fantastic article adapted from Tony Hsieh’s upcoming book, it is a riveting read, to me. Tony and his CFO championed a culture as the key means of differentiation in the difficult online shoe and apparel retailer segment.  Competing against Amazon online isn’t easy.

What makes Zappos different is that they don’t compete on price:

Zappos sells shoes and apparel online, but what distinguished us from our competitors was that we’d put our company culture above all else. We’d bet that by being good to our employees — for instance, by paying for 100 percent of health care premiums, spending heavily on personal development, and giving customer service reps more freedom than at a typical call center — we would be able to offer better service than our competitors. Better service would translate into lots of repeat customers, which would mean low marketing expenses, long-term profits, and fast growth. Amazingly, it all seemed to be working.

They compete by differentiating on service.  And they’ve bet that by taking exceptionally good care of their employees, that that would translate into better customer service.  By all accounts it was working quite well, but the board wasn’t supportive of “Tony’s social experiments”, but rather tolerated them as long as things went smoothly and the risks to the business weren’t too great.

I think it would be too easy for business owners and managers to conclude that Zappos, and by inference, Tony’s “social experiments”, failed because they sold to Amazon (albeit at an attractive price).  I believe precisely the opposite is true – that they were able to command north of a $1B value precisely because of the culture they created – which made them both an interesting business for Amazon to acquire, and a separate culture which Amazon would find worth preserving (despite the normal tendency of acquirers to stamp their culture upon acquisitions instead).

At BP3, we also pay 100% of insurance premiums.  We invest in our employees’ retirement plans (through matching – not just through paying the administrative fees) – more companies should be doing this.  But we’re also looking to increase our investment in other team growth opportunities – including events like bpmCamp.  We’ve invested here in there in other personal development opportunities but if I’m honest, we haven’t done enough yet.

As a professional services firm, we can relate to Tony’s thought process on culture.  If you take care of the people who touch customers, you are, by inference, taking care of your customers as well.  If you take the people who touch your customers for granted, you are borrowing trouble and relying on people to swim upstream to provide a positive experience for their customers.  You’ll find it harder to retain the best talent, and you’ll find your competition acquiring the best talent.

Taking care of your team is job 1. My hat is off to Tony and the whole team at Zappos.  We’ve been fans, and we’ve been happy customers, here’s hoping that Zappos continues the culture crusade into the future.

Mark Suster (@msuster) makes a (somewhat) controversial argument that one should not hire job-hoppers.  Apparently what makes it controversial is the judgmental tone of the email, and the black-and-white nature of the initial statement.  The title of his piece?

“Never Hire Job Hoppers. Never. They Make Terrible Employees”

But, if you read it more carefully, and his comments below – he is quite clearly saying that some people develop a pattern of job-hopping.  If someone is a “job hopper” they will not make a good employee.  People take issues with both parts of his argument:

First, that you can determine (pattern match) on job hopping.  They argue for circumstances and exceptional situations.  But Mark really was quite clear that 2 or 3 of something does not define a pattern.  its 6-10 data points that define a pattern.  I think even if you disagree with his exact definition, you can arrive at your own definition of what a job-hopper is, and match people to that pattern (or not).

Second, that job-hoppers make for bad employees.  However, most of the arguments made on this point started by describing someone that would not meet Mark’s definition of a job hopper.  Moreover, Mark didn’t argue that these employees wouldn’t do good work, necessarily.  His argument is that you want to build a team that lasts – and these job hoppers can really undermine your company and your team’s morale when you are trying to get to exit velocity (and critical mass) at your firm.

I think Mark’s right.  Building sustainable value requires hiring people who share your values (select to the best of your ability), and who are interested in building the enterprise at the same time that they are building themselves.  When you have shared values and commitment, it is easier for the the employer to compromise to enable employees to reach their aspirations as well as aiding the firm in achieving its collective aspirations.

Some would argue that you can align long-term incentives that build with longevity – to encourage job hoppers to stick around.  But in my experience those incentives don’t work on someone in this job-hop mentality.  On the one hand, the rewards are too far in the future to motivate them. On the other, during any significant rough patch in the business, they may perceive those long-term incentives as being worthless or unattainable.

Its hard enough to retain people through inevitable troughs when they’re not job hoppers.  And employees, like investors, often buy high and sell low – joining a firm when things are great, and leaving when things are tough, but often right before the firm rebounds again to a higher plateau.

Having said all of that, I also feel that employment is not a blood pact, nor is it a marriage.  While you need people to stick around to grow your company, they also need the employer to give them enough leadership, financial reward, and emotional energy to be motivated to help you build it.  Its a working relationship based on mutual respect and trust.

Of course, lots of people follow Mark, and Paul Dix took it upon himself to have a full-blown response about hiring job hoppers.  He does make some good points, but misses the mark.  The basic argument he makes is that you should hire people that won’t stick around for more than a year, two at the most.  The most undermining point in the whole post: “…while I’m currently bootstrapping my own [company] and haven’t hired anyone yet.”  So really, Paul needs to go through the experience of hiring employees and retaining them before he can speak well to both sides of this equation.  Having been on both sides of the equation myself, I can summarize a few things nicely:

1. If you’re company is growing, it is easier to retain talent.  Sales fixes a lot of problems, because it creates opportunities for the people on your team.
2. When people stay less than a year, the company tends to burn a lot of resources on that employee without earning the investment back in revenue (or product improvements that will drive such revenue).  As a result, it is natural for companies to hedge their risk of hiring someone who is likely to leave quickly.
3. When you stay at a company longer, you definitely get the closed loop feedback of your own performance.  You can see if your customers are successful or unsuccessful.  You can see if your code performed well in production or failed miserably.  You can see if techniques you thought would scale, actually do.  You can see if organizational and hiring decisions you made actually work out – was that brilliant engineer you hired really a great employee, or just a great interviewee?  Sticking around gives you that data.
4. None of this absolves the company of the responsibility of making the firm an attractive place to stay.

I think the spirit of what Paul is missing, is that you’re trying to build something bigger than yourself – and you want to attract people to that cause that share that desire.  If you find people that fit your definition of “job hoppers” – by all means contract them if they can tackle specific problems or have specific skills you need – but don’t hire them, because it isn’t what they really want anyway.  Their goals and your goals as the company hiring, are too misaligned for it to work out well.

Ben Horowitz writes in “Four Things Some VCs Do That I Don’t Like” one thing in particular which really resonated with me:

VCs often confuse marginal social courage with real courage. For example, they think CEOs who fire people easily are tough. I’ve fired dozens of people and laid off hundreds. None of them was easy—not a single time. Having an easy time firing your loyal employees indicates a lack of courage and a lack of leadership. More specifically, it indicates a lack of willingness to really understand the negative consequences of those actions. If you fire people easily, you likely lack the toughness to look in the mirror.

(My emphasis on the last sentence).

This statement gives me great insight into the character of Mr. Horowitz.  Because firing people *is* hard.  And when you have to do it (for performance or for financial reasons), you do it with heavy heart.  As he says, courage isn’t doing things easily.  Courage is doing the hard things even though they’re hard, if they have to be done.

Ted Leonisis of Newsweek writes about Google’s decision to stop filtering search results in China. In the first half of the article he focuses on this decision by Google and why it might be the right thing to do (for Google).  He points out, rightly, that this type of gesture would be meaningless if you couldn’t “keep the lights on,” but if you have the financial means, then he makes a persuasive argument for Google’s decision.

His take:  while Google has imperiled billions of dollars in future profit (in China), it has rendered itself “a happy company at peace with its values—and happy companies are more, not less, likely to continue being successful.”  This statement really rings true with me.  There are definitely companies that thrive on adversity and conflict, but companies in general seem to be more successful when their business and their values are in alignment.  I believe this is true regardless of what your values are – if you run a cut-throat competitive business, it is best not to shy from conflict inside the four walls of your company.  If you run a customer-service oriented business, its important to take care of your employees.

Ted also uses the example of AOL to illuminate: the mission at AOL transformed from bringing the Internet to everyone, to making the next quarter’s numbers… and many important business decisions were made that did not align with the higher calling of the company.  The separation between a company’s actions and its mission can also happen when the mission is achieved (either by your firm or others) – for example, with AOL, Internet access for everyone has happened – it just isn’t AOL that made it happen after a certain point.  For Microsoft, a computer on every desk is a reality – they’ve succeeded so well that they need a new higher calling to bind the company together.

Of course you can create motivation that lasts months or years around a competitive threat – no doubt the xbox folks could put their sites on Sony and Nintendo to motivate for years.  But what drives Nintendo is, I would argue, a better core mission.  If I had to state it, I’d call it “making gaming fun for everyone.”

Ted refers to his way of thinking as “double-bottom-line thinking.” If you expect these decisions to be non-capitalistic, then you misunderstand the logic behind his thinking.  For example, he raised prices at Washington Capitals games because he wanted to build it into a franchise that could succeed – and lower prices would only further damage its financial ability to achieve success.

This “double-bottom-line” thinking is central to the way we look at bp3′s business as well: we really believe in improved business processes, this is not just a shortcut for us.  We also focus on taking care of our team – because our team takes care of our customers.  When friends and colleagues who run their own businesses ask how we can justify paying for benefits like health insurance or 401k matching, I ask them if they are sure they can afford not to.  We believe we’re managing to our double-bottom-line, but it is something we need to revisit periodically to assess.

This “double-bottom-line” thinking is something that is not often weighed in process improvement projects, but perhaps it should be.  If we just squeeze the process without considering how to make the net result better for customers, and to align the process better with the higher calling of the company, then we might be missing something terribly important.  Aligning with both mission and the bottom line requires first, asking a question: “how does this align with our mission?”

(Note: there is a whole segment of BPM to address this, and other priorities, and how they feed into business planning: the business motivational model, or BMM )

Preamble

With the thinning of the herd of Pure Play BPM software vendors, and with the energies of firms like Oracle and IBM behind BPM, I think two predictions we can reasonably make are:

1. BPM software will be pervasive (or pervasively available).  IBM, Oracle, Pega, Progress, Software AG – they’re all going to move a lot of BPM software.  And of course it looks like open source offerings are going to be more prevalent as well.
2. BPM software is going to get better – either because the big stack vendors invest in the new products they’ve acquired, or because the remaining pure play vendors continue to innovate at a faster pace and grow, or because open source solutions will lift the bar for the minimum requirements that all the BPM software suites have to match.

Why Pure Play BPM Consulting?

But the other prediction we can make, is that there is a growing need for specialty BPM consulting firms – or, dare we say it, “pure play” BPM firms.  These BPM consulting firms are all about BPM – and not about being all things to all people. Nearly all of the points I’ll make about BPM pure play service firms likely apply to pure play services firms in other market segments.  The advantages:

• They really “get it” with BPM – and they’re willing to explain it to customers, they even evangelize to people who might never be customers.
• They’re really invested in understanding the BPM space – which pays dividends over time. Their staff don’t go from BPM project to integration project to database architecture project – they’re transitioning from BPM project to BPM project. It takes time and patience to develop a deep practice in BPM, and it takes time to develop a deep bench in any services business.
• The right methodology and tactics to get BPM projects successfully deployed. And after all, success is what we’re after…
• Really deep expertise on at least one BPM software suite – every product suite has its own strengths and weaknesses and you want staff that knows what those are before they start your project.
• Process improvement staff, that understands how to marry improvement methodology to BPM Software.
• They are “high touch” - high quality, long-term relationships with customers are more important than chasing the next shiny deal, because they’re not selling software…
• Experience, quality, focus, and vision. Not volume.
  

Pure Play BPM consulting firms also fill the void left by pure play BPM software companies being purchased by the Big Software companies of our day – previously these pure play firms had staff focused on BPM alone, but now that they’re part of a bigger machine, focus will be diluted within a much much bigger team.

It’s hard to imagine the big guys matching this focus – not that they can’t afford to, but just because they have so many customers, and so many products, and so many people, that they’ll always depend on specialists (pure plays, if you will) to augment their teams of business and technology generalists.  These general purpose consulting, outsourcing, and off-shoring firms just don’t bring the BPM-specific focus to the table.  As such, customers will continue to need pure play service providers to bring that depth of experience and focus to the table.

Requirements Risk

The BPM Pure Play consulting firms know that you can’t throw requirements over the wall to 50 guys offshore to build the software to meet those requirements.  That’s very old-school separation of responsibilities, but it is based on a lack of trust between the parties – requirements have to be thoroughly specified before anyone can start working – and all the work has to be exactingly matching the requirements or it isn’t accepted.  Keep in mind that the biggest risk to any project is that the requirements are wrong; any methodology that puts off finding out the bad news is going to increase risk.

As my friend and colleague John Reynolds pointed out in the comments on my previous post, so much of this is about Trust.  The pure play firms understand how to build that trust with the business by building the solution in the same room, and doing frequent playbacks of the results of their labor.  Iterations and Accountability are the watch-words of these engagements. It doesn’t take 50 people to get the process right, it takes just a few of the right people in the room, and they have to be brave enough to hear the feedback of the business on a daily or weekly basis, and then course-adjust.

Prioritizing

Another issue: the big firms don’t know what they are not.  They’re trying to provide any service their customer needs. Pure play BPM services firms don’t need to increase their own footprint on the project by capturing non-BPM work, because the universe of BPM consulting work is already so much bigger than their ability to capture that business.  Sure, an increased budget will be good for the bottom line of any services company.  But a pure play services firm can be relied upon to turn down work that isn’t in their sweet spot – or at least to advise you that you are asking the firm to take on work that isn’t their strong suit.  Pure play services firms (not just in the BPM ecosystem) can afford to turn down work because they know what they are, and more importantly, what they are not.

Where did we get these crazy ideas?

These aren’t revolutionary ideas – they’re well known and understood and tested in industry as best practice (and not just for BPM projects).  But the general firms just can’t adjust from a world of 100+ person projects to a world of smaller, independently motivated teams engaging in highly value-added projects that act independently – it just isn’t part of their business model.

The BPM Pure Play service firms are the tips of the spears in a sense – the vanguard of experts that increase your odds as a customer of punching through the inertia and hitting the target of success we’re all aiming for.  The BPM ecosystem needs that ability to cut through the noise and focus on what matters most.

The summary of an MIT Enterprise Forum’s gathering of 3 economists seemed to be optimistic, but with major caveats and concerns.  With three bubbles in our rear view mirror (dot.com, oil, and banking/real-estate), the concern has turned to a potential fourth bubble: cash (when there’s too much of it, inflation can eat away at it too quickly).

Here in Austin, a major new shopping center has opened (phase 2 of the Domain), and the tallest building in Austin is nearly complete (the Austonian, apparently the largest residential tower in Texas).  Meanwhile, Facebook is opening an office and hiring 200 people in Austin.  And co-working facilities seem to be doing well, while providing a good support network for small businesses. So perhaps the better-than-average local economy is influencing my optimistic outlook.

Meanwhile, the Senate has passed a $15B jobs bill. I don’t know if anything in the bill will affect our business directly, but we make our decisions without regard to tax effects (generally that seems like putting the cart before the horse), and from what we can see the environment is still favorable for BPM software and deployments – businesses are investing in process improvement, and BPM.  And big software companies are investing in BPM software (witness the acquisition activity of December and January).  Its a good time to be focused on BPM.

Ok, its no secret that I love coffee and cafes with wireless.  But as I’ve said before, I think having an office is important.

But recently two authors have made the case much more eloquently than I have.  James Reinhart’s post, “Why your start-up needs to get out of Starbucks and into an office right now” makes a great case for why working at the local coffee house can be undermining your start-up.

He points out the main deficiencies:

• 75% productivity (this might be generous)
• Lack of space for whiteboards, etc.  The virtual tools don’t replace real stuff yet.
• Boundaries between work and play dissolve in an unhealthy way.
• It doesn’t save much money (office space is cheap).

I’d add to this:

• If you have to take professional calls, the coffee house, and the busy street outside, are *not* appropriate places to do so.  Neither is home, with the dog barking in the background.
• You can often sublet space cheaper than the market rate from another company that isn’t able to fully utilize their space yet.

So he’s given us the cost-benefit justifications… and that’s where the “Locker Room Theory” comes in, which captures the essence of how I feel about having an office.

Today, many people believe in the distributed model – many executive teams are spread all over the country (or globe) and connect only virtually.  Many start-ups believe in the model.  But David Dufresne’s reaction:

I’m sorry, but I don’t buy that at all. As far as I am concerned, business is all about people. Building a winning tech company is mostly about people and having a strong team dedicated to a strategy and executing it together. Being a hockey fan, I will use a hockey team as the analogy for a portfolio company. Being on the road is like being on the ice. That’s where you score goals. That’s where you win that big contract. That’s where you build momentum; grow a sales pipeline, forge partnerships, hurt your opponent, drop the gloves if needed, etc.

But, when players are not on the ice, they are in the locker room. The locker room is where it’s hot and where it stinks of hard work and empty cups of coffee. It’s where you regroup in between periods, look your teammates in the eyes, listen to your coach and team captain, get ice for that bloody bruise, adjust your strategy and tactics. It’s also where you celebrate after a game. Open that case of cold beers every Friday at 4PM. Get back to the whiteboard to figure out what went wrong on that goal against or sale lost to a competitor.

I think this is great insight, and if you don’t mind a hockey analogy, it works well.  In our business (business process management consulting), we can’t avoid being a distributed team.  But we do our best to make it feel closer (investing in videoconferencing, for example), and we very much believe in our investment in a headquarters so that when we are together, we can *really* be together and hash things out.

When people ask me why BP3 has office space, I don’t have trouble explaining why.

Great article from Jeff Jarvis advising companies with nonphysical goods to stop selling scarcity and start selling value. It is a principle that can be applied to a great many businesses, not just the “Web 2.0″ world, but as he points out, education and consulting as well.

His advise to advertising businesses: sell the outcome, don’t sell the scarcity of your space!In the Content world, he points out that content just isn’t scarce any more.  The existence of this blog is actually just one more data point to that effect!  Information is not scarce either – with Google at our fingertips. He goes on:

Thus we have performers and consultants. There is still value in unique performance. We will continue to buy tickets to concerts by stars (but we won’t pay for the Muzak covers of their songs on elevators). We will buy books. We will pay to sit in a movie theater with popcorn. The new competition in the case of media and performance isn’t that someone will make a good-enough version of what we do but that there is more call for the public’s attention.

Quality is a scarcity. But it is a real scarcity.

The challenge is, there has to be recognition that:

• You (your company, your product, your content, etc.) represent quality, and
• Your level of quality is discernably and valuably differentiated from other sources of similar product, content, expertise, etc.

In BPM, we’re suffering a scarcity of BPM-related skills.  We already have a general shortage of technical skills in the world, but on top of that, having the technical skills combined with the understanding of business and process improvement – we’re talking about a real scarcity for the right talent and skills.  But as I’ve argued previously, BPM isn’t hard because it is rocket science – each component task we do in BPM isn’t hard – its hard because knowing the right combination of tasks is a subjective, judgmental activity that depends on experience.

But the *real* scarcity isn’t the BPM bonafides.  The real scarcity is quality BPM skills and personnel.  Because what we’re selling isn’t truly our hours of labor.  What we’re truly selling is the outcome: a successful BPM deployment; a successful BPM program; or a successful transfer of skills and methods to a COE. My shorthand for this is that our customers are buying success.

Had lots of feedback in favor of adding Disqus commenting system (here and in other blogs), specifically around threading, identity, and sharing.  For example, you can login using your Twitter id or openID etc.

So we finally bit the bullet and installed it.  Hope it helps keep the discussion going in our blog and makes it easy for everyone to post their opinions!

As of February 1, BP3 is in new offices.  We’ve moved just a short distance from our old office on Balcones Drive in Austin, to our new office at Plaza 7000, at the intersection of Far West Blvd and MoPac Expressway.

We’re really happy to have the extra space, and our new co-working arrangement with Red Velvet Events.

Today, I unwrapped a little present for the new office that makes it feel like home to me, and that’s an espresso machine:

First latte at bp3 headquarters

Its a Nespresso Citiz, and yes, I’m expecting to be wide awake at the office from now on, and a little less cash will be going to Starbucks this year.

I couldn’t agree more with Fabrice Grinda’s post on Why you Need a Partner.  Perhaps I’m biased, since BP3 started with two co-founders.  But I also have a lot of friends who own their own business.  And I’ve worked for people who own their own business.  And it just is true that very few people can be good at everything they need to be good at to run these businesses well.  If their business makes enough money, they can hire the help they need to run their business.  But early in a company’s life, it is really useful to have people on your team who ACT like owners (whether or not they are).

Finding the right partner can be problematic – but my recommendation is to try.  Find someone who is different, but make sure that you appreciate and value the differences, rather than finding them annoying.  And make sure the reverse is also true.  This should be someone you would want to partner with no matter what the startup idea was – not just because this person makes sense for this one idea.

And if the partnership isn’t working, exit stage left and try again- but don’t make each other miserable.  Life is too short to get stuck in an unhealthy business relationship.  Make sure you have a fair separation agreement in place from the moment you form your business.

Man. Steve Blank writes some great stuff.  Makes me wish I had gone to epiphany back in the 90′s!  He explains that if you’re going to go work for someone, make sure they have big plans, plans to grow the enterprise – because that growth is what you will benefit as a member of the team.

I thought his IMVU example was pretty interesting.  He mentions Will Harvey and Eric Ries (of Lean Startup fame) as being cofounders who wanted to swing for the fences and turned down buyout offers.  So, being me, I click on the link for Will Harvey – and I see he is at “Finale | Fireworks” along with Chris Hondl.  What a blast from the past.  Will was the TA of a Motorola 68040 assembly language class when I was in college (Stanford CS 110 if I recall) and Chris was the star student in the class.  We had a “robot simulation” game where we programmed the strategy for a robot to interact in a maze.  Mine was one of the four finalists, but Chris’ was a class above the rest in terms of the elegance of design and economy of action. Chris went to work with Will at Sandcastle, and most of us in class were fairly in awe of Will for his chops as the writer of music software for the Mac.

There are times when you realize it is a small world.

At bp3, we’re building a business process company, just like the tag line says, making no little plans.

BP3 will be moving into new digs come February 1.  Doing this move at the beginning of the year feels like good timing too.  A new year with new goals and objectives – and new professional space to go with it – very much a fresh start but with great foundations. Choosing a new office space is important, because it can affect your firm’s personality.  Is it a space people want to come to work in?  Is it a space that promotes collaboration and a professional environment?  We’ve definitely found such a space in the Plaza 7000 building in Austin.  (I should point out that we have a modest space within this fine facility, lest the picture give a different impression)

I’m pretty psyched about the new space as I think it will be a better work environment and offers some better nearby amenities, along with room to grow.  Of course our needs are modest, but most importantly, the new office is still near a local Starbucks…  Some people have asked me in the past – why have office space at all?  After all, we travel a fair amount to client sites, we don’t always get to work out of home base.  And then there is the expense.  But I think the explanation is simple: we’re building a company – a team – and that requires working together, sharing and collaborating.  And sharing workspace is part of building a community and team and having a center of gravity.  The virtual forms of communication are all great, and useful, and keep us connected with our team members who aren’t in Austin, or who are on the road.  But it still helps to have a home base.  The cost is minimal compared to the benefit.

You’ll find us at the corner of Far West and Mopac at the Plaza 7000 building in Austin after February 1st, though mail will continue to forward for some time from our old mailing address. I also want to thank Red Velvet Events, who will be helping us coordinate the move, and will be subletting space from us in the new building.

A funny thing happened the other day on the way to the hotel.

I’m commuting to San Francisco for a really interesting application of BPM technology to customer service scenarios for a company that doesn’t sell product – they sell an experience – a process, if you will – to both sellers and buyers of certain goods.  Just working with a company that thinks of their process as their product is refreshing enough, and makes this a very interesting project to me.

Because this project is in San Francisco, there’s really no need to have a rental car to drive around.  Its about $45/day for parking, and if you don’t mind walking a few blocks, and taking BART up from the airport, everything is essentially walking distance.  On Monday I had plans to meet up with an old friend from Stanford, who coincidentally also worked with me at our first employer, Trilogy.  With plenty of time to spare I was walking from the customer’s office to my hotel, which takes me past the headquarters of Vast, where several other friends from Austin and Trilogy work.  As I walk by, I notice an old colleague in the window, so I knocked and he invited me in and we had a great conversation about life, business, the future.  Along the way another gentleman in the office walked over and asked if we could give him some feedback on a pitch he was planning, to promote a creative-commons approach to user-data management.  And we then spent the next 30 minutes hashing out what this meant in the context of Facebook, iTunes playlists, and other types of user-generated content that, he contends, users should have the right to port, move, export, share. The next day he was headed to a conference to try out these ideas on a broader, critical audience. I was really impressed by the depth of thinking on the subject, and how well he could turn our questions into opportunities to clarify the pitch. Good stuff.

After that conversation, I headed back up to the hotel, and met my old friend for dinner.  We walked right past Vast again on the way to the restaurant, and had a good 3-hour discussion over dinner at Town Hall Restaurant (highly recommended, I might add).

I relay this story not because it is that relevant to the world of BPM, but because it touches on something immensely important – the value of your network.  The odds of me running into someone and having such an educational discourse on identity and user data management in the new world order is pretty low outside of the Bay Area.  And coming into contact with new and different ideas and perspectives is part of what makes the software scene so vital in San Francisco.  I’m convinced that at least part of that is due to the “walkability” of the city.  Although you can get similar effects in any city with good gathering spots – be it a coffee shop, a burrito joint, or a local pub.  And in South Bay, it isn’t so walkable, but there are great meet-up spots like Hobee‘s, and clusters of companies in Palo Alto or in other parts that provide this same walking-distance effect.  But it isn’t just a story about the network effect in the Bay Area.  After all, the folks I was meeting up with are transplants from my current home town, Austin.  The power of networking in software circles in Austin is pretty incredible to me.  Very small degrees of separation, and a high degree of willingness to share, cross-hire, cross-promote.  Even tighter than the Austin network, that Trilogy Alumni network is quite cohesive.

If I may offer some perspective that 15 years in the business world has given me… Building your network of valued friends, coworkers, colleagues, peers – this is part of the process of building a career.  It is so important to nurture the people you are connected to, and to be open to the opportunities, insights, and perspectives they will offer you over time.  If your old firm doesn’t have an alumni network or mailing list, start one.  I’ve been managing one of these lists for 8 years now, and the personal satisfaction has far exceeded the investment of my time.

Also, when you travel for work as much as I do, you get a chance to refresh your relationships in person, and not just over email and phone and twitter.  It is so important to take advantage of those opportunities.  Meeting with my old friends and colleagues and hearing about their lives and careers is part of what recharges me and inspires me to keep working on the vision of bp3 – “a business process company”.  It’s also part of what helps you establish place and belonging when you are away from home for too long.

I just want to take a moment to thank good friends who take time out of their lives to meet with me on short notice – or even when I just knock on their window passing by – and please allow me to return the favor and entertain you in Austin, Texas if your travels bring you our way.

It was just over 2 years ago that I decided to join Lance in starting BP3.  The day that I decided to take the plunge, my wife and I (along with our daughter) met with her sister at a local Chinese/Cantonese restaurant in Austin and had dinner.  We don’t usually talk about my work at dinner, but we spent most of the dinner talking about it that night. I had just decided to inform my boss for the last 4 years that I was going to leave and join Lance in starting BP3, and was getting my thoughts together for that conversation.

After a very good dinner, the bill came with 3 fortune cookies.  I opened one, and inside were three fortunes, rather than one:

“Now is the time to try something new.”

“You have executive ability. Apply this in the future!”

“Your present plans are going to succeed if you stick to them.”

Far be it from me to argue with the fortune cookies.

Its been a great 2+ years with BP3 – I couldn’t ask for a better team to work with, and I’m very grateful to the customers and partners who saw fit to invest in our success, just as we invest in theirs.

Thanks to Michelle Greer, I found this post on Gaping Void about the using blogs to create a “global micro-business”.  The whole post is a great read about how a tailor in England used a blog to transform and improve his business.

The best part, of course, is that it didn’t require changing the product being offered.  It just meant spending the time to communicate the passion for the business that the owner had, which would generate additional interest in the value of the product he was selling.

The author makes a couple of great points about why this strategy worked. My favorites, which I believe apply to BP3:

1. A great product.  This really was one of the best tailors in the world.  Similarly, we really believe BP3 is as good as it gets for delivering BPM solutions (service rather than product).
2. Focus.  The tailor kept at it, and kept his blog focused on suits (not breakfast).  When our blog strays from the main topic (process), or our own business (BP3), we’ll try to keep it focused on topics that relate to process, but possibly in different ways than people might usually imagine (e.g. startups, Apple, etc).
3. Continuity – The tailor had it.  We have it too.  We’ve been doing BPM as long as anyone, and we’re focused like a laser on our space.
4. “We don’t have to create the brand out of thin air. We just tell the truth and the brand builds itself.”  I feel the same way about BP3.  We don’t have to come up with a great marketing pitch – our actual project stories are plenty good enough.

So, with that said, we’re going to keep focused on building BPM success with customers, one project, one program, one customer at a time.  We think the “brand” will take care of itself.

As a firm that is entirely focused on BPM implementations, we get a lot of queries from staffing firms, and I’m going to take this post to speak out against the practice of using these expensive, non-value-adding, players in the marketplace.

We get (each of us at BP3) about an email a day from a staffing firm looking for “a Lombardi Teamworks Administrator (or Developer or Architect) in Bentonville, Arkansas (or Bay Area or Boston or where-ever” (or other locations).  (someone should tell these guys that there is only one company in Bentonville likely to buy BPM and need to hire outside help… )  If I could convey one thing to companies deploying BPM and using staffing companies to augment their teams, it would be to understand the value chain in the BPM staffing equation, and why those firms are ill-equipped to help companies achieve their goals with BPM.  If you’re using a staffing firm, odds are you could save money and time, and achieve better results, by working directly with BP3 (or other boutique BPM firms).

Customers: Problems with Staffing Firms

From the perspective of a customer, what are the problems with using staffing firms?

Problem #1:  BPM services aren’t a commodity. They specialize in commodotized staffing in areas where there are millions of developers to choose from, like vanilla Java development, PHP, SQL, HTML, etc.  They have no concept of why the going rate for BPM experts is higher than the going rate for Java experts. They are used to treating software engineers  like day-labor construction jobs.

Problem #2: These staffing companies don’t understand what BPM is. No one at these firms has worked for a BPM software vendor, or a BPM consulting firm.  They’re essentially headhunters/recruiters, with no vertical domain expertise in BPM.  The staffing companies won’t provide any differentiated value add once the person is placed.  There are no skills at the staffing company to help that consultant be successful once they’re onsite.  There’s no technical support, no project management support, no lifeline to call.  There’s just a rate and a # of hours.  They don’t care if you deploy a waterfall or agile methodology, they don’t care if your project is successful – frankly, their job is to sell bodies, not to sell success.   If you are a customer, don’t ask them to help you make your project successful other than by adding or replacing personnel.  If you are a contractor through these firms, God help you if you struggle – you won’t get any help from them.  If they smell blood in the water they’ll replace you as though you were a stapler that didn’t staple straight.  But they will NOT help you.

Problem #3:  Because they don’t understand BPM, they don’t understand Process Improvement.  So you are going to forgo any help identifying opportunities for process improvement, or getting someone on staff who really understands how to do that.  When you work with a firm focused on BPM, you can expect to get those skills in either the people you contact with or the people who support them.

Problem #4:  They can’t get the best resources.  Because they aren’t BPM experts, they don’t know which of the folks they talk to are good and which ones aren’t.  They aren’t deploying people they have years of history working with. They aren’t deploying people they have a good basis from which to interview and judge competency.  They’re just deploying whoever will take the lowest rates and the most demanding contract terms, allowing them to maximize their profit.  There are very few really good BPM experts out there, relative to the demand – and even fewer experts who are available at any one point in time.  Some of the best BPM experts in the world work for BP3 and companies like ours, but you’ll never get to them through the staffing outfits – because boutique firms like ours are a threat to their business relationship with customers.

Independents: Problems with Staffing Firms

From the point of view of a contractor considering a staffing outfit:

Problem #1:  You are a commodity to them – a stapler, or worse, a staple.  They don’t care that eventually you’ll go work for someone else, they just want to maximize profit right now.  They’ll squeeze you hard on rates and terms in the contract.  They don’t care if you’re happy, they don’t care if you’re successful, so long as they have a chance to replace you with someone else and keep getting paid.  They don’t care if you get eliminated from consideration for arbitrary or unimportant reasons (like, having the wrong accent, being unable to travel on a particular date or day of the week, or having 22 months of experience instead of 24 minimum… )

Problem #2:  Staffing companies will not “sell” you to their customers.  They are just presenting you, and not taking sides too strongly – they let the customer decide if they want to work with you, and they’re not strongly invested in the outcome for any one person, because the customer knows that the staffing firm doesn’t know you from Adam and Eve.  See point #1:  you’re a staple. There are more just like you (as far as they’re concerned).

Problem #3:  Once a staffing firm has presented you to a customer (or rejected you for that customer), you have no shot of getting into that customer through another avenue.  This is a function of the contracts between the staffing companies and their customers – usually anyone they present, even if they present them with the reasons why that person isn’t a fit, is no longer available to the customer without violating some kind of contractual constraint that requires them to pay the staffing company.  As a result, they’ll never revisit these decisions.  So if you, as a contractor, put your name out through “Superior Staffing”, but also reach out to BP3 about working on a particular account – odds are that you’ll either get staffed through the staffing firm at a lower rate than what we would pay (if you’ll take it), or you’ll get rejected because the customer has already seen your name through the staffing firm and doesn’t want to run afoul of that contract.  Many independent contractors mistakenly believe they are better off reaching out to as many opportunities as possible at the same time – but if those opportunities are consulting and staffing firms, that isn’t the case.  I’ve seen embarrassing situations where the same person was proposed by three different companies to the same customer.  If you have a more valued relationship with one of those firms over the others, the customer sure won’t see it in that circumstance.  And they’ll likely see you as little more than a mercenary and not someone that they can depend on to work the duration of the contract.

Why Work for BP3?

Against this backdrop, we’re being approached every week by people who want to work with BP3.  And our colleagues refer additional people our way every week.  In fact, we just hired another great asset for our team last week.

In a previous post we made the case for why customers work with BP3:  we’re in the business of selling success. But why do BPM experts and people interested in BPM want to work for BP3?

So why do these highly skilled professionals want to work with BP3?

1. We live eat and breathe BPM.  This isn’t a fad or hobby for us, this is our livelihood and our career.  We understand why BPM expertise is differentiated.  Prospective employees and contractors understand that if they work with us it will improve their own brand in the industry by association.
2. We’re invested in the success of our team.  We want our staff to be successful.  We’re working on long-term relationships with our clients, and as a result – when we put someone on our project, we continue to provide technical and project management support, not to mention support through managing the customer relationship.
3. We don’t squeeze our folks on salaries and rates just because the economy is challenged.  We want to be working with our staff for a long time, and we know BPM is going to be in demand for years to come.  We’re not so short-sighted as to put the squeeze on people at the first sign of trouble.
4. We represent our colleagues well to the customer.  We help our customers understand the strengths and fit of our consultants.  We help work out a travel schedule that works for both parties.  We provide video conferencing capabilities from our home office to help enable effective remote work.
5. When the going gets tough, we help.  We’re BPM experts.  We can help with the technical lifting, and we can help with process improvement consulting.  We can help get a project that is off the rails, back on track.  And our customers know that we’re there to help.  Its part of why they keep coming back to work with us.
6. We have a good reputation.  I believe we have a good reputation for fair dealing, for being good to work with and for.  We also have a good reputation in the BPM market as experts in our field.  It isn’t our first time to the rodeo.
7. Our business is growing.  Despite the economy, we’re growing in the face of it and staying focused on our key value driver:  making customers successful with their BPM projects.

If you’re a BPM practitioner, BP3 is a great firm to work for.  If you’re a BPM customer, BP3 is a great firm to work with.  We’re not your only option, but we’re trying hard to be your best option.