Everything Has a Cost; Make Sure What You Do is Worth It


I was talking to a coworker the other day about an initiative to save money on a project I am currently working on. He stated there is a cost to doing business and if the contract is written so the cost is higher than reward, you need to get out of that business. This got me to thinking about the song “Everything that Glitters is Not Gold” by the late Dan Seals, especially this part:

Everybody said you’d make it big some day
And I guess that we were only in the way
But someday I’m sure you’re gonna know the cost
’Cause for everything you win there’s something lost

We sometimes like to think there is a free lunch or that good things in life come without a price tag, but as long as you have to choose how to spend your 24 hours, you have to make trade offs. I am currently making some trade offs in being with my family to make more money, with the focus on spearheading our debt so we can live anywhere we like without the thought of having to focus on high paying jobs ever again. At the same time, I am keenly aware of a personal story of a man who traded his family for every promotion offered to him. If you choose to spend more time with your family, it will likely stop you from becoming a billionaire. Conversely, you might reach that billion dollar goal if you sacrifice your friends and family. Each person has to decide the currency they want to keep.

What makes this whole time currency tricky, is other people are determining the currency they are willing to put up for their goals. A good “salesman” is the person who can achieve their goals while helping others achieve their own goals. This leads us to:

Win-Win versus Lose-Lose

We often think of salespeople at the masters of maximizing what they want while minimizing what we get. I think a large part of this comes from dealing with particular types of salesmen (car salesmen come to mind). But this does not describe the good salesman.

One thing that good salesmen have in common is the ability to create win-win situations. Zig Ziglar stated it nicely when he said:

You can have everything in life you want, if you will just help other people get what they want

There are a couple of important takeaways, as this relates to “everything has a cost”

  • You have value and should not sell yourself for less than your value – the next topic
  • Your value goes up when you have proper synergy, whether this is just you and the right knowledge/tools or you are in a group
  • Anyone trying to have you sell yourself for less than your value is not a good salesman (and definitely not your friend)

Not realizing your value

Let’s talk about value.

The bible states that God has granted each of us with immeasurable value. Aristotle stated that the whole is greater than the sum of its parts. This means so many of us undersell the value we have. When we combine in groups, this value can be even greater.

The important thing to note is the price you are willing to pay should be greater when you are getting greater value. In like manner, the price you are willing to let yourself go for should be greater when you hold greater value. Too many of us undersell ourselves.

Relating this back to “everything has a cost”, you must correctly estimate your value correctly and assert yourself to somewhere in the vicinity of that value. The dynamics, once again, go up when you are dealing with more than one person, like a group or your family.

Trade Offs and Agendas

I have a degree in Mass Communication with a specialty in film and video. In my career, I have worked with media and I have a keen understanding of how the media works. Often, for a variety of reasons, the story is already determined before the media arrives to report it. My wife finally saw this in action when my daughter Miranda was going through cancer treatment. We had a local news station show up to highlight a fundraiser for Tiffany’s Team in Training effort, focused around Miranda. The songwriter’s fundraiser raised a small portion of the total amount Tiffany had hoped, but the media reported they had met their goal. The story was already written before we were ever interviewed.

Sometimes you can steer the media in another direction, however. Below is a video about the Vanderbilt Cares for Kids event. The reporter was there to highlight the event, which focuses on all children that spend time in the hospital. In the process of interviewing Tiffany, the direction changed, and a good portion of the slot focuses on childhood cancer.

   
Changing the set path for a story

Turning the media is not the norm, however, unless you have a more compelling story than the one they set out to tell. It is extremely difficult if they have a competing story coming in at a greater volume. Let me put a real life example to this concept.

In September, 46 women are going to shave their heads for childhood cancer. It was a crazy idea Tiffany came up with last fall that has grown into a full blown effort. Currently, there is an effort to decide where to shave their heads and how to engage the media. One option is being on a national show.

On the surface, the show appears like a great option. Millions of people will watch the show and the mommas will be featured on stage for a short time. If everything works out, the following will be achieved:

  • Millions of people will tune into the 46 mommas site and hear the stories and awareness will be raised
  • Celebrities will be influenced to take up the banner for childhood cancer

But there is a potential it will go the other direction:

  • National media exposure will be lost to the louder message from the show
  • Celebrities will already have their own cancer focus and none will be turned to raise the banner

Of the two options, and my experience with the media on both sides of the camera, I find it more likely show will get the majority, if not all, of the national media attention. And, since the celebrities often show up for just a few minutes and then leave, and often have their own private green rooms, it is unlikely any of the mommas will get enough time with any of them to sway their opinions enough to make a difference.

The point here has nothing to do with whether the mommas should be on show, or even whether they should shave their heads before the event or not. The point is there is a value in what they are doing, and, if they are wise, they will figure out the value and determine the correct course of action.

Relating all of this back to “everything has a cost”, we have the following points:

  • Everyone has a value – we might also add, in the above example, that the whole being greater than the sum of the parts dictates even greater value
  • The value must be determined based on the dynamics of the situation at hand. This is true of events, but also true of determining the correct job one should take, how to spend Friday night, etc.
  • The value of time is then weighed against different demands.

The end game is you take the value and make sure you choose the demand that most respects your value, whatever the traded currency is.

Wrapping It Up

When we first got on television with Miranda, we felt the exposure was the important message. In the process of doing the interview and watching the story degrade, we determined that the value of correctness in the story, and started making sure the media had fact sheets. We also learned how to turn the media to what was important to our cause by making it a more compelling story. It all comes to the value we placed on getting the story out and getting it right.

For you, it could be negotiating your next job or your next raise. It could be determining which event to go to this coming Friday. Or it may even be a once in a lifetime event. No matter what it is, don’t sell yourself short.

Peace and Grace,
Greg

Twitter: @gbworld

46 mommas –


This week, I worked on taking over a project that probably did not need taking over thankful to a momma and her friend. Hopefully soon the 46mommas.com site will be up. In the process I got wind of some of the photos of cancer mommas with their children. Take a look at the pictures and see the beauty in what you see. Then read the bottom of the post for perspective.

jumama1

import pic 11 10 2009 195

DSCN3629

Tiffany and Miranda

Arden Bucher (7)

Some of the pictures are professionally done. Almost all can pass as professionally done. Now here is an exercise. Guess which of the children above are alive today. If you want to go by statistics, 80% of these children should be alive. Want to take your guess?

I know this may sound a bit morbid, but this is the reality of childhood cancer. And, if you run with the rates in 1995 against current population, 46 children are diagnosed every work day. If you run against newer incident rates from the American College of Pediatrics, it is 53. Once I can churn the SEER stats and run them against the census numbers, I will have a true picture.

One more thing. In most instances, the treatments are almost the same they were in the 1970s. Despite huge strides in adult cancer, the children are still working on 30 year old protocols. Very harsh news.

Peace and Grace,
Greg

Twitter: @gbworld

Stranglehold on the Market – The Dark Side of IT Recruiting


This entry is based on a conversation I had with a friend recently. He informed me he had moved from Nashville due to the recruiters having a strangle lock on the market and not paying decent rates. Having seen some rate sheets at clients, he was aware the clients were paying more, but the recruiters were not and simply chose to bail than to fight any more.

I have a lot of recruiter friends who I like and respect. And I realize there are recruiters out there who are being fair about things and setting decent margins. I know you guys are running a business and trying to do the best for both the talent and your families. As a whole, however, the recruiting industry has control of many markets and is exercising that control. With the downturn in the economy, and having full control, the recruiting companies are skewing who makes the money and who does not. And, as you might guess, the contractors are not on the winning end. In some cases, I have seen the recruiters making out like bandits while asking the talent to sacrifice. Sorry guys, I don’t see that as right and I really hope it bites you hard once the market turns around or the talent realizes they are in short supply and can ask for a lot more. In fact, for the most egregious of you, I hope you find it impossible to continue to make a living after you are exposed.

My real beef, which I have personally seen, is the subcontracting “industry” where both the company writing the contract with the client and the subcontractor who supplies the talent are both making huge margins, forcing the talent to work for peanuts.

I Can’t Afford to Pay You That Much, It’s the Economy

This is the primary story I have heard over and over again. And it is legitimate in many cases. Prior to the economic downturn, many recruiters were getting X dollars per hour for mid to senior level talent. As the economy turned down, the rates went down, so contractors have to be paid less. Sounds fair, right? But this is the curve you expect due to a downed economy. Note the curve is based on money, and should be adjusted to margin (I just did not have the time?).

Best

Notice the nice symmetry and how the margins stay pretty much the same for the recruiting companies. Unfortunately, this is not what happened in many instances, something I now have evidence of. Instead, as the economy went down, the recruiting companies often shifted the risk of doing business to the talent, having him/her pay for the fact they had fewer contracts. This is represented by the following curve:

Worse

This would be nearly impossible without control of the market, as there would be competitive pressure. The company(s) still offering higher rates would have more business. Making it even worse, I saw companies doing this:

Worst

The more the the back end of the line flattens out, the more the talent is taking it in the shorts and the more the contracting companies are making out like bandits.

Note that this would not have been possible by market control alone. We needed some desperation on the part of the developers to get this much disparity. I was sitting in a cafe awhile back and overheard recruiters talking about how they were making much more during the economic downturn as it was easy to convince contractors to take less due to the economy. I am all for capitalism and making a decent living, but if you were struggling before the economic downturn and you are now making good money, despite having fewer contracts, you are part of the problem.

As a follow up, I have personally witnessed the rates rising on the recruiter end. Yet I still see many companies low-balling the contractors. This means all of the money is going to the recruiters, some of which are making a really good living off doing less work.

Take Something From Each Contractor

At one time during this economic downturn I was told by a recruiter that it was unlikely they could find me a position at the rate I was looking for as the company was asking current contractors to take a hit per hour due to the downturn in the economy. Now, I am not talking about new contracts being negotiated lower, but rather that current contractors were being told that the rates had to go down due to the economy. With the way the message was conveyed to me, it did not sound like the companies were renegotiating in mid contract.

If I were ever in this situation, as a developer, I would ask the company to show me the contracted rates and prove they were in fact going down before I would agree to a lowering of my rate, even if it was less than a dollar per hour. And, if the margin was high enough, I would not agree to do it regardless. There is a cost of doing business and some of the risk of doing business should be borne by the business and not the contractor.

The ability to pull money mid-stream from a contractor is an artifact of controlling the market. If the recruiters were fighting to be middle men, this type of activity would end up with a penalty flag. The fact it has not is probably a sign of the desperation of some contractors, but I feel companies doing this will have to pay the piper some day.

Subcontracting

Subcontracting is huge now, as finding proper talent is hard. The problem is this generally means higher rates for contractors, and that is not happening. Businesses are demanding better candidates and rightfully so.

The general idea behind the split of money between the recruiter and the contractor is each person is being paid for the value they bring to the proposition. The recruiting company has two roles to pay: one who gets the contract from the business and another who gets the talent to fulfill the contract. When a subcontrator gets involved, there should be a split of the contractor money where each makes a share based on what they bring to the table. Realistically, overhead forces the contractor rate to go down a bit in a subcontract situation, but it should not be significant.

This is not what is happening today. The subcontracting companies, who have a lower risk as far as reputation, are trying to make a full cut out of the contract. At the same time the company securing the contract wants a nearly full share. This cuts the contractors share from 65% – 75% of the take to around 35% – 40% of the take. To make it even worse …

The H1B Factor

Currently, there is an entire industry around peddling H1Bs. The general business model is to sell the talent at nearly double what the talent is being paid. The problem is this generally skews the talent pool.

As an example, I know of a situation where talent is being paid about $50k over the life of a contract on a corp-to-corp rate (talent bears the risk and pays all expenses and taxes). The subcontract company is going to make more the $40k over the life of the contract and the company with the contract is going to make more than $45k over the life of the contract. In this particular instance, the talent is making around 37% of the total, while still bearing most of the risk of his position.

It is perhaps understandable that H1Bs can be taken advantage of in this manner, as they have a threat over their heads: they can be deported for not playing the game. It is less understandable that these companies are trying to use the same model on natives and a bit befuddling that they are getting away with it. I guess the talent out there, especially the unlearned talent, does not know.

Please note that I understand there is some risk and overhead with working with H1Bs, but the slight added risk is not worth $50,000 or more a year you are taking out of their pockets. Instead the rates should be lowered to reflect the talent.

If I take a step back to the example where the talent made about $50k, the contracting company about $45k and the subcontracting company making $40k. That’s a lot of money. In fact, with this much money on the table, I could hire an employee for a six figure plus salary and still make a decent margin. And, since the talent would not be squeezed on salary, it is very likely I could hire someone with serious talent rather than try to find as much talent as I could for as little money as possible. Sure, only one company would be making margin in this example, but they would end up with talent less likely to bolt when “the market improved”.

For those of you I know that are offering fair rates, I will continue to send people your way, as I know you  will treat them fair. For those I know are not, I wish you the best of luck.

The natural end to continuing down the road of “me first” in recruiting is something like the current model in India. When companies hire an employee in cities like Bangalore, they often do not set up the employees/contractors account up until after their first day of work? Why? Talent simply does not show up. Here are some common scenarios:

  1. Talent is offered X more per hour and simply leaves one company for another company.
  2. Talent seeks another position for X more per hour. When offered the money, he goes back to his own company and asks for a counter offered. If agreed, he simply does not show up for work at the new company.

I, personally, don’t want to see this model in play.

All Subcontractors are not Created Equal

You would think the way to get treated fairly is to incorporate yourself, get errors and omissions insurance, and start collecting like the subcontract company. There are two issues with this.

  1. The H1B companies have driven the rates down so the contracting company can make a killing.
  2. The contracting companies rarely pay higher than H1B rates to other subcontract companies, except those at a certain level. As an individual, you will not be considered a person worthy of a higher rate.

This is what is leading my friend out of Nashville, which is heavily controlled by the recruiters. Even with his own corporation, he was still seen as talent, and not a subcontractor, with the exception that the deal was corp2corp. Rather than throw out fair rates for his reducing their overhead, they were trying to increase their margin. This is disgusting guys. And you wonder why so many developers call you guys pimps?

Advice to Recruiters

First, I understand we are dealing with capitalism and you can make what ever market you want. I also realize there are recruiters out there who are not putting 100% of the risk on the talent and are offering decent rates. For those who are raping their contractors, the market will eventually turn.

  1. Figure a decent margin and set your rates around that margin. You have the power to set whatever talent will accept, of course, but if you head this direction it will turn around and bite you when the talent discovers what they should be making. I can’t tell you what this margin is, as there are wide variety of factors:
    1. Corp2Corp, 10-99 and W-2 have different margins
    2. Any benefits offered or added increase margin
    3. If you have to include per diem, travel, etc, you have to increase margin
  2. If you are getting the contract and subcontracting the rest of the work, you don’t deserve the same margin you get when you handle both sides of the contract. The same is true if you are the subcontracting company. To take full margin on both ends only screws the talent.
  3. The H1B gravy train is coming to an end due to legislation already signed. It may be accelerated based on buzz that the Obama administration has to create a political sign their are trying to keep jobs in America. Once the H1B stream dries up, you will find far less talent willing to accept only 1/3rd of the take.

Hopefully the recruiters who do not practice the “anything to make more money” game will step up and join in the chorus. The main reason some talent considers ALL recruiters “pimps” is these bad apples. If you are not one, you should be as sick of this game as I am. And playing party line is not a wise decision, in my opinion.

A good movie to watch to understand the concept is Public Enemies. While I did not enjoy the movie too much, I did find an analogy for this entry. At one point, the syndicate (mafia) realizes that Dillinger and Floyd’s bank robbing is pushing the government to give Hoover’s FBI greater power, due to the “interstate” nature of the crime. The syndicate backs off support of the bank robbers in the process, seeing that more FBI means more regulation of their lower key illegal activities.

The point to recruiters is talent, in general, considers you a festering sore. Business sees you as a necessary evil, at least for now. This is due to those who are adding less and less value for more and more money. When it reaches the point where it is cheaper for business to go back to a more HR-centric model, the party is over for most of you. And when the talent discovers they are making a very small percentage of the pie for doing the heavy lifting, they may become motivated to find their own positions. At minimum, you will likely see more of the talent gravitating to the companies who are not making more off less during this “downturn”.

I pray my recruiter friends will understand that this is not aimed at me and forgive me for exposing what is under the kimono, but something has to be said when companies are working off margins so high they are taking the lion’s share of the money and pushing all or almost all of the risk on the talent. After sourcing a few positions over the last few months, I am disgusted at where we are today. And the picture, when I run real numbers, is uglier than I thought it was when I was examining this completely from the outside.

Summary

Earlier this year, I ranted about the new healthcare legislation. The main thrust of the legislation was to ensure nearly every American an insurance card, yet the real problem with our healthcare system is the cost of healthcare not the lack of insurance. Certainly, there are some who fell through the cracks  who needed better access, but rather than solve that problem, they overhauled the entire system for everybody.

How this relates to recruiters is one of the issues with cost is the insurance company having near complete control over the market. The insurance companies have embedded themselves as middle men in almost every transaction. Replacing a middle man with another is unlikely to solve the problem.

In like manner, the recruiters have near complete control of many markets. And many have abused this control, especially since the “downturn” in the economy. What is interesting is some are still playing this game as the market heats up. In many markets, it is very hard to find talent, yet the rates are still set as if it was a buyer’s market. I wish you luck if you are going to try to sustain it that way.

Peace and Grace,
Greg

Twitter: @gbworld

ASP.NET MVC 2.0 in Action: A Review


Disclaimer: I am already familiar with ASP.NET MVC and have worked through some projects in 1.0 and played with the 2.0 bits. The reason I have this disclaimer is this is not a review from a newbie standpoint. I make no warranty that a newbie will have the same feelings I have about the book, although I will address my feelings on this as we go along.

I picked up the book ASP.NET MVC 2.0 last week and started ripping through it. In this review, I want to lead through the pluses and minuses of the book. Before doing that, I want to go into why I chose this book as a starting point into MVC 2.0.

My journey started last week in Barnes and Nobel in Round Rock, Texas (La Frontera). I got copies of all three of the currently released MVC 2.0 books and looked through them. I was looking for quite a few different things in the books, including the following:

  • Wide variety of depth from the basics of MVC to more advanced topics
  • Use of best practices (testing)
  • Use of common third party libraries. As an example, the book had to have decent coverage of JQuery.

The three books I looked at:

My feelings about the Wrox book was it felt like a MVC 1 book with a chapter on 2 added. This does not mean it is not a good book to learn from, only that I was looking for something that felt 2.0 all the way through. I dumped Programming ASP.NET MVC due to the lack of JQuery, which is probably a bit petty of me, but you have to draw the line somewhere. I am happy with the Esposito books I have purchased in the past, so it was a bit arbitrary.

Let’s get the negative feedback out of the way first.

Negative Points

I have these in order of importance or how I rank these in importance.

Disconnects in Multiple Author Books

One issue with multiple authors is a disconnect. There are two forms of disconnect common to this form of authoring:

  1. Repeat of information in 2 or more chapters
  2. Different toolsets used to solve the same, or similar, problems

In most instances, repeat of information (issue #1`) is the more annoying of the two, so . While seeing different viewpoints on a topic is valuable in some contexts, it is more often more time consuming without much benefit in the context of a technical book.  Repeat of content is not a big issue in ASP.NET MVC 2.0 in Action. I have seen the #1 issue in numerous books in the past, but the lead author seems to have taken control so each chapter is very specific in content. This does not mean there is no overlap and repeat, but that there is no overt duplication of content.

Different toolset to solve the same problem (Issue #2) is more prevalent in the book, as each author has chosen his own toolset. It is not a huge problem, as many of the authors either work, or have worked for, the same company. But there is some disconnect. In particular is the choice of JQuery for UI and ASP.NET AJAX for validation, as JQuery is a good solution for validation and Microsoft includes JQuery in all ASP.NET MVC projects, as a standard component.

This issue would not be as glaring if both JQuery and ASP.NET AJAX were highlighted as a validation solution. Throughout the book, there are many cases where multiple options are shown. For example, chapter 13 includes StructureMap, Ninject and Castle Windsor for Dependency Injection. We also see the Spark view engine as an alternative to the standard ASPX view engine. This makes the exclusion of JQuery for validation all the more glaring.

Please note, I am not against ASP.NET AJAX for validation. It is more about a disjoint in presentation of the material. That, and a reliance on two different libraries to accomplish what a single library can accomplish. If the chapter either a) showed both or b) made a case for using ASP.NET AJAX over JQuery validation, I would be completely on board.

This pretty much covers the “major” negative feedback point I have for the book. I had a brief talk with Eric Hexter today and understand how schedule and MVC changes drove this negative.

Disjointed Sections

I can’t put my finger on any one item at this point in time, but there are a few areas where the book feels like items have been shoved into the chapters. It is minor overall, as evidenced by my lack of a concrete example at this point in time, but they are evident by a break in flow. Overall, as you read the book, you feel like you are moving with the current. But occasionally, there is a dam in the river that forces you to stop and get your bearings.

Positive

Now that we have that out of the negatives out of the way, here are my feelings on the positive side.

Adherence to proper coding standards

It has often been a pet peeve of mine when I pick up a book and all of the samples are simple concept/theory only samples. While I understand the need to get concepts down with very simple examples, an entire book devoted to these types of samples is a waste of time, in my opinion. In addition, samples like the following tend to teach people bad habits:

[

HandleError]
public class HomeController : Controller
{
 
public ActionResult Index()
  {
   
var dataContext = new MovieDataContext();
   
var movies = from m in dataContext.Movies
                
select m;

    return View(movies);
  }
}

NOTE: The bad habit here is muddying the controller with data access code.

Fortunately, this book is one of the exceptions of the bad coding rules. When there are simple samples, the authors take time to show you how to improve on the code and make it more applicable to real world applications. In addition, there is an entire chapter devoted to avoiding some of the more common site hacks. This, in and of itself, is worth the price of admission.

Domain Driven Design

While the authors are quick to disclaim the chapter on Domain Driven Design as overly simplistic, it is a very good intro for people who have never coded using a DDD style. The idea of separating the data access “models” and presentation models from domain models is foreign to many developers, making this a very valuable chapter. I would still recommend books like Domain-Driven Design: Tackling Complexity in the Heart of Software (or Applying Domain-Driven Design and Patterns: With Examples in C# and .NET, if you want something .NET focused) to fill in the knowledge gaps, but Chapter 8 is still a very useful intro to the concept and well done.

Nice Sample Project

Talking to Eric, the authors spent time developing the project prior to writing the book, and it shows. The majority of the samples, especially as you move farther into the book, focus on the sample project. And while the chapters do not always build in a solid flow, the project is something you can use to get a grasp. It would be nicer to see some of the methods and mechanics surrounding the development of a project, since they took the time to build one, but I realize this is a book on ASP.NET MVC and not developing a project, per se.

Good use of alternatives

The book contains a chapter that shows the Spark view engine, so you can get a taste of what it means to move away from the standard ASPX view engine. It would be nice if it also contained a bit more info on why you would use Spark (pros and cons), but there is enough to get a taste of how Spark works. It could well whet your appetite to play around a bit more.

Then there is an entire chapter on IoC containers featuring StructureMap, NInject and Castle Windsor. It would have been nice to see a bit of Unity in the mix, as Unity is the new IoC container Microsoft is pushing, but the chapter gives a nice feel for using IoC containers for dependency injection in your ASP.NET MVC application, which is something you should explore if you want to take testing seriously.

Excellent Use of TDD

While it is not always at the forefront of every chapter, it is obvious the authors took testing seriously and devoted a lot of effort to testability in their sample application. Perhaps it is not strong enough, and some readers could walk away unconvinced, but I am firm believer that tests put the science in computer science and readily advocate test early at minimum, preferably TDD, in all of the projects I spearhead. I find it pays off on all levels once the learning curve is overcome. And it pays huge dividends with change orders and bug fixes.

Summary

If I had to choose a five star rating, ASP.NET MVC 2.0 in Action earns a solid 3.5, with some chapters rated higher. Other than the few flaws I have pointed out, and perhaps a few more I cannot think of at the moment, there is very little content that would earn less than 3 (average).