• Friday, December 12
“What do you mean we’re losing all our people?” Kurt says, looking shocked.
It’s one week after the meeting with Steve and Dick, and Maxine has been pleased with how the agreed upon plan is rapidly progressing. Bill, Maggie, and Kurt are starting to put together the Innovation Council, and work within the Unicorn Project is going faster than ever, preparing for the massive Christmas holiday promotion launch.
The Orca team continues to study the data from the Thanksgiving campaign, and they are certain they’ll have an even higher response rate this time around by incorporating what they’ve learned. All their experiments and results are again being poured back into the Panther data platform. They are also continuing to harden the infrastructure to handle the resulting onslaught.
However, many of the things they took for granted after last Friday’s exciting meeting with Steve and Dick no longer seem certain. Which is why Chris summoned Kurt and Maxine to his office.
“They were never ‘your people,’ Kurt. You were temporarily loaned a bunch of engineers for the Unicorn Project,” says Chris. “All those engineers were already assigned to other projects in the new fiscal year, which starts in a few weeks. They’re all important business projects with people depending on them being fully staffed. All those business managers are raising hell because we’ve reassigned those resources, and they’ve banded together in revolt.”
“But why now?” Kurt asks, incredulous. “What got everyone so riled up?”
Chris laughs humorlessly. “Sarah is stirring the pot, egging them all on. Bill is pulling together another meeting with Steve and Dick to figure out how to deal with the shenanigans she’s pulling.”
“I can’t believe Sarah is stirring up a counter-rebellion, to umm, counter our Rebellion,” Kurt mutters, sounding offended that Sarah had stolen his playbook.
Later in the day, Bill writes:
Continue as planned. We’ll figure out how to backfill those positions. We are stuck in the middle of a huge political battle. Sarah and a board faction are on one side, and we’re on the other side with Steve and Dick.
Throughout the day, they discover that Sarah is indeed an incredibly effective corporate guerilla fighter, having successfully raised an insurgency army against them over the past week.
Maxine is grudgingly impressed with her resourcefulness, despite driving her batshit crazy. She wants nothing more than for Sarah to just give up and go away.
“In so many ways, Sarah is a remarkable person,” she tells her husband at dinner. “In a slightly different universe, Sarah could have been an amazing force for good. If this were a superhero movie, she’d be the gifted person who turns into the villain after some traumatic life event. And now she goes out of her way to crush all sparks of joy she can find.”
Monday morning, Kurt and Maggie meet with Bill to stave off Sarah’s efforts to undermine them. Maxine stays behind, resuming her work with Cranky Dave on a technical issue jeopardizing both the Unicorn promotions campaign and the core Phoenix application. Over the last month, they had started building tons of automated tests for Phoenix so that they could better and more safely make changes. The effort was incredibly successful. However, with so many tests, running them now takes hours, and developers are starting to avoid checking in their changes, not wanting to wait for the long test times.
Worse, some of the automated tests were failing intermittently. Last week, she cringed watching as a developer, whose tests failed, just ran them again, and they also failed. So, he ran it a third time, as if it were slot machine in a casino. This time it passed. This is no way to run a development shop, Maxine thought with embarrassment and distaste.
Recognizing that this will soon become a new bottleneck for developers, she had the teams work on parallelizing the Phoenix tests so they could be run across multiple servers. But they discovered that running parallel tests caused Phoenix to occasionally deadlock or crash entirely—and if it’s crashing during testing, it’s probably crashing in production too.
“Maxine, we’ve narrowed it down to an uncaught exception somewhere in the Phoenix order fulfillment module,” says Cranky Dave. Maxine is with Cranky Dave and another engineer with laptops open. When she pulls up the code on her laptop, she physically recoils. “Wow,” she says, speechless as she scrolls down the file … and scrolls … and scrolls …
“Yeah,” says Cranky Dave, laughing. “This is two thousand lines of code to determine whether we can ship to the order location. A bunch of architects made this framework fifteen years ago, predating Phoenix. Even the TEP-LARB came around and realized this was all a terrible mistake, but the people who wrote that framework are long gone.”
Maxine keeps scrolling and scrolling, gob smacked that she can’t find any business logic, just boilerplate code: loops iterating through orders, order items, line items, just as dangerously as the middle school girls had done so many months ago. There’s null checking everywhere, as well as type tests, downcasting, coercing, and all sorts of horrible contortions to get at the desired data, through enumerated types or polymorphic supertypes without concrete subtypes. There’s so many object methods that she can’t keep them straight in her head: getOrderLines, getItemLines, getShippingLines …
She opens her mouth, but nothing comes out. “This is … incredible,” she says at last, with apoplectic horror and disbelief. She closes her eyes, trying to summon some relentless optimism, thinking of the Hoare principle: “There are two ways to write code: write code so simple there are obviously no bugs in it, or write code so complex that there are no obvious bugs in it.”
“Gentlemen, we are going to clean up all this crap,” Maxine says, with a level of confidence that she realizes may be foolhardy. Even Cranky Dave looks cowed. She exhorts, “This should be simple code. All we need to do is retrieve the locations from the order, right? We can do this!”
They spend two hours writing tests around the code to make sure they really understand how it works, and then they start pulling out common operations, putting them where they belong. Maxine modifies the class hierarchy to their best advantage, but adheres to functional programming principles, using modern types and their idiomatic map, reduce, and filter functions, just like the famous Google Map/Reduce paper that inspired Shannon’s Panther project.
By noon, they’ve reduced the two thousand lines of code to five hundred lines. Cranky Dave grins. “That is amazing, Maxine. This is probably the first time in over five years that anyone was brave enough to touch this code.”
“Eight years,” says the other developer. “This code is beautiful! And I think I found the problem. Here’s some code that isn’t wrapped in a try/catch block.”
Looking over at his laptop, Maxine immediately knows they’ve found the issue. “Nice work!” Now that they’ve drained the swamp of the muck, the problem is obvious.
While they go get lunch, Maxine stays behind, wanting to try an idea out. She opens up a new window on her laptop. She copies the data that the team has been manipulating all morning and starts redoing the code from scratch in Clojure.
Forty-five minutes later, Cranky Dave is back and hands Maxine her sandwich. He asks, “What are you grinning at?”
“Oh, just the results of a little experiment,” she says. “I rewrote our code in a functional programming language, using its built-in data types and standard library, to see if I could make it even simpler, smaller, and get rid of the need for exception handling.”
“And?” prompts Cranky Dave. She turns her laptop around to show him.
“Holy shit,” he says, staring at her screen in disbelief. “Fifty lines of code.”
Maxine laughs, knowing that they’ll be inspired to try to match or exceed her results. Even for her, this was an incredible display of achieving the First Ideal of Locality and Simplicity.
The work they did this morning will enable parallelized testing and make it blazingly fast, surely creating huge productivity dividends long in the future, allowing developers to keep moving fast, getting even faster feedback on any errors. It’s like the opposite of technical debt. It’s like when compounded interest works in your favor. If they could make developers a little more productive all the time, it would always pay off in spades.
Maxine smiles as she sees Cranky Dave open his laptop, still giddy with excitement over their successes. He says, “Uh oh.”
On his screen is the Unikitty CI status page. Maxine looks to see whether the fix that they checked in before lunch passed the automated tests. But instead of getting all green lights, she sees that the tests aren’t running at all. There are over fifty jobs in front of them, all waiting to start.
“This is bad,” Cranky Dave says. “The entire Unikitty CI cluster is down. Everyone’s builds are stuck.”
Annoyed, Maxine looks over at his screen. She curses. This is ruining what is supposed to be their shining moment of triumph and glory.
He says, “The #ci-unikitty channel is going nuts. No one can run their tests.”
Whenever Unikitty goes down, they have a bunch of angry customers: their fellow developers. What better proof that Unikitty is an internal platform that they must manage like a product, not just as a project. It’s never done, if they want to keep their customers happy.
They look all over for the Unikitty team. They find Dwayne, Kurt, and two other engineers in a conference room, crowded around Brent’s laptop.
“Good timing. All the Dev managers are screaming that their teams can’t get their work done,” Kurt says, looking up from the huddle. Maxine is surprised at how haggard he looks. He has bags underneath his eyes. Kurt’s having a rough couple of weeks, she thinks. “We can’t afford this distraction right now, of all times …”
“This is what we always wanted, right? Customers!” Maxine says with a big smile. “You wanted people to value the infrastructure we’re creating? Well, your wish has been granted. After all, if they didn’t care, they wouldn’t even bother complaining.”
The adoption of CI practices has been astounding, with nearly one third of all engineering teams using Unikitty in their daily work. But they’re having problems scaling it to keep up with demand.
She looks at her watch. It’s almost noon. Every developer tended to check in their code before heading out to lunch, which probably caused something in Unikitty to fall over. Unikitty is having more than its share of growing pains, Maxine thinks.
Kurt sighs. “If you look in the chat room, many of the Dev managers are saying that they’re tired of our flaky build servers and that they’re pulling their teams out of Unikitty. They’re going to go back to doing builds the old way.”
Maxine’s smile freezes on her face. “You’re kidding.” Going back to the bad old days like her first days on the Phoenix Project would be … intolerable. That wouldn’t be a setback—that would be a genuine disaster.
What was happening? It felt like all the progress they had made with the Phoenix developers and with the achievements of the Black Friday launch and the Unicorn Project were slipping away. They were slowly being pulled back into the morass, dragging all the engineers that they had liberated and made productive back in with them.
It’s almost four thirty when the Unikitty team finally gets things back up. But there are so many builds and tests backed up, it will be almost midnight before all the jobs finish running.
“I can’t believe it was a networking switch failure,” Dwayne says.
Maxine shakes her head in disbelief. Another Unikitty hardware failure is embarrassing. From the beginning, it had been cobbled together from whatever equipment Kurt and the team were able to scavenge from almost every corner of the organization.
They’ve had disk failures, power failures, and now network hardware problems. She hates seeing highly skilled engineers walking around with screwdrivers, opening up server cases, and mucking about with physical infrastructure.
Sure, she has many fond memories of working on hardware, both in her career and with her kids. When she was a young engineer, she had loved opening those huge boxes full of the newest, hottest equipment on the loading dock, and then racking and stacking them. But back then, she also loved rotating the backup tapes.
Now, this type of work seems so low-value, especially when compared to the opportunity cost of the work they should be doing, which is figuring out how to blaze the digital future of Parts Unlimited.
Their job was to build code, not muck with the actual hardware that the code runs on.
“I hate to say it, but I think Unikitty is on her last legs,” Maxine says to Dwayne. “We can’t keep running something this mission-critical with hardware that Brent finds under his desk. And it’s not just hardware issues—each build server is still slightly different. Like when my compile job doesn’t run on Build Server #3, it takes ten times as long. We’re spending too much time keeping it running. We’ve got to do something about this—soon.”
“No argument from me. We’re all just so busy right now,” Dwayne says, shrugging his shoulders. Maxine can’t argue with that.
As was predicted, there is hell to pay. Tuesday morning during Kurt’s team meeting, Kurt says, “Chris not only chewed me out in front of everyone at his staff meeting, but he invited Rick too. He presented his plan to create a competitive CI service to compete with Unikitty.”
“Rick?!” Dwayne asks, expressing the complete shock and disbelief that Maxine feels. “He wouldn’t recognize a CI service if it bit him in the ass!”
Kurt slumps. “Sarah has apparently started shouting from the rooftops that Unikitty is jeopardizing the entire company and that we should be shut down.”
Silence falls over the entire table.
“Amazing how people are blaming us for anything bad that happens around here. The toilets broke on the second floor yesterday, and we’re being be blamed for that too,” says Cranky Dave.
Kurt’s phone buzzes. He picks it up and stares at the screen for several moments. He looks at Maxine. “We gotta go. Bill just pulled together a meeting with Maggie. More bad news, I think.”
Maggie sees Bill look up when his assistant Ellen lets her, Kurt, and Maggie into his office. “We’ve got problems,” he says, standing up and picking up his clipboard. “We’re meeting Steve and Dick in fifteen minutes in Building 2. I’ll brief you on our walk over.”
As they walk outside, he says, “Sarah convinced Bob and the rest of the board to freeze all expenses, effective immediately. And Steve just found out that they’re denying the $5 million he was going to allocate to the innovation efforts.”
Bill shakes his head. “That Sarah is something, isn’t she?”
“I have learned so much from her. She’s an incredible expert in merchandising, but she’s never led software projects,” Maggie says. “She creates high expectations for everybody, which is great, but she definitely has some blind spots when it comes to managing people and teams … she’s not exactly a nurturing type.”
“No, I suppose I don’t,” Bill says, grimacing. “I have a really bad feeling about this meeting.”
When they walk into the grand conference room, Maxine immediately knows something is wrong. Steve and Dick are here, as well as Chris. But surprisingly, so are Kirsten and, very ominously, Laura Beck, the VP of HR.
Having the head of HR in a meeting is never a good thing, Maxine thinks. To her surprise, she spots Erik standing at the back of the room, looking at the historical pictures hanging on the wall. He gives her a quick wave.
At least Sarah is nowhere to be seen, Maxine thinks.
“Grab a seat, everyone,” Steve says, looking up from a printed spreadsheet, a grim expression on his face. “You probably heard that Sarah successfully convinced the board that we shouldn’t increase our costs until after we release earnings.
“Unfortunately, that’s not all the bad news,” he says. “Last night, the board instructed me to reduce costs across the entire company by three percent. Sarah and our new board director, Alan, have convinced everyone that the success of the Black Friday promotions have unlocked huge new efficiencies; therefore, we don’t need as many people.”
Maxine hears gasps from around the room. She feels like she’s going to throw up. Or cry. Or both.
I cannot believe this is happening, Maxine thinks. I feel like I’m partially responsible. After all, I had a lot to do with making the Unicorn Project so successful and planting the seeds of the Innovation effort.
And somehow, those successful efforts that she is so proud of are now going to cause a bunch of innocent people to lose their jobs. Dammit, Sarah, she thinks.
“Sorry, folks. I know this is surprising news, given the increased revenue from Unicorn. I really thought we had more time with the board,” Steve says.
“You’ve probably already done the math,” he continues. “To hit this goal, we’re going to have to reduce headcount across the company by about 150 employees. And to fund the innovation efforts from internal operations, we’re going to have to find an additional $5 million of costs to cut or reduce headcount by another forty people.”
Maxine hears more gasps around the table as the casualties keep mounting. She can’t breathe, and she feels her eyes tearing up.
She looks at Laura, the VP of HR. So this is going to be one of those meetings. Now that the reduction targets have been set, everyone will first defend their turf, trying to maintain their slice of the pie. Once the allocations have been agreed to, everyone will come up with a list of names of people to eliminate. Then they’ll have to decide whether Sally is more important than Sam, or vice versa.
Maxine is filled with dread. Looking around the table she says, “These are real people. People with families who depend on them. These are people who will be walked out the door with all of their things. One after another, everyone will watch people leave, dreading that their name will be called next, wondering when the managers will finally be done piling up the bodies. Only then will Steve’s scheduled email go out to the entire company, announcing that the purge is over, including saccharine remarks of optimism and, of course, asking everyone to do more with less.”
Everyone drops their heads. Suddenly, Maxine doesn’t want anything to do with any of this. She wishes things could go back to the way they were. She wishes she had never joined the Rebellion. She only wanted to get the builds going, to help make developers productive. She had never imagined that it would be the Rebellion that would be helping decide who would get to stay and who must leave.
If I had known that joining the Rebellion would lead to all this, she thinks, looking around, I would have kept my head down, stayed in my lane, not rocked the boat, just like Chris told me to.
“I really thought they’d give us until at least January,” Dick says, shaking his head. “The purpose of this meeting is to prepare a plan to submit to the board that takes down operating expenses by $15 million. And if we want to fund the innovation efforts, we need to take costs down by $20 million.
“Steve and I have already met with the heads of each business, and we’ve asked them to put together a plan to cut their part of the $20 million target,” he says. “Which is why you’re all in the room. We need you all to come up with a plan to eliminate $2 million from the IT organization—that’s about fifteen people across all of your groups.”
Maxine does the math. That’s more than four percent of all the technologists in the company. “No! This is horrible. We can’t fund the Innovation effort given all this. It’s just not worth letting all those people go,” Maxine says. She sees everyone turn toward her, some with expressions of hardened weariness and some with sympathy, as if she were a child who just discovered Santa didn’t actually exist.
“Maxine, around this table we’re all too used to doing layoffs,” Bill says. “I’m guessing that all of us believe that our most important work today is finding a way to fund the Innovation effort. Otherwise, everything you’ve done and achieved will go to waste. We’ll just be choosing a slightly slower death. If we don’t invest in doing new things, we’ll still end up where we started: outgunned and outmaneuvered in the marketplace.”
Chris turns to Maxine. “Bill is right. It’s the right thing to do.”
Maxine just shakes her head, still aghast at the human toll.
Steve looks at Maxine. “Yes, protecting the Innovation effort is our most important task. If I didn’t believe this, I would have just threatened to resign. After all, they can cut costs without me. But this work is so important that we must do everything we can to make sure the Innovation group gets its chance.”
This all makes Maxine feel even worse.
“But why? Why is this Innovation effort so important to you?” Maxine finally asks Steve.
Steve looks thoughtful for a moment. “What Erik said last week was right. As a company, we must show that we have a viable growth thesis and that we can create value in ways besides just cutting costs. By the book, there’s two extremes for how to run companies, which affects how you plan and how the investment community perceives you. On one extreme, you have Alan and Sarah’s way of creating value, which is just by cutting costs. You squeeze every bit of margin you can out of the operation. Some companies thrive at this, and some manage to malinger for decades, but most eventually fade and disappear,” Steve explains.
“But when you’re in this mode, you’re often just playing financial engineering games,” Steve says, gesturing at Dick. “In order to stem our losses, we’ve had to do a couple of asset sales to generate cash. But this can be like selling the furniture to pay the mortgage bill. Eventually, you run out of things to sell and you can no longer fund daily operations, which means more layoffs.
“On the other end of the spectrum, you can choose to build the company for growth. Like I said, if you’re not growing, you’re slowly dying. The Unicorn Project has proven to all of us that we can actually grow: by creating new offerings that customers want, by taking market share away from our competitors, by doing things that great companies do,” Steve says with a thin smile. “And when we grow revenue, we eventually grow profits too. And we earn the ability to innovate and place more bets in the marketplace, which accelerates growth and ensures our relevance in the future.
“Investors reward growth,” he says. “Already our stock price is up, and we haven’t even reported earnings yet. Analysts are starting to raise their price targets. This means Wall Street is rewarding us with higher multiple on revenue. A couple of months ago, we were valued at less than 1.0x trailing revenue, which is almost an insult, because they’re expecting us to shrink. When we announce the results of this quarter, hopefully they’ll start valuing us as they would any healthy retailer. And in time, they may value us much higher, as someone who is defining and leading, and maybe even disrupting our market.
“Bill is absolutely right, Maxine,” he says. “The easier thing to do is to just do what the board says. But the right thing to do is ensure that the Innovation program has its shot. It sucks, but as leaders there should be no doubt that cutting deeper is the right thing to do, because it creates a potential path to long-term growth.”
Maxine still feels sick as the managers start to negotiate which departments will eliminate eighteen positions. They debate whether they will eliminate a few experienced engineers or, for the same price, a larger number of junior engineers. Axe the managers or individual contributors. Eliminate employees or contractors.
When she can’t take it anymore, Maxine excuses herself to take a walk, just to get out of the room.
When she gets back a half-hour later, she sees that Chris has agreed to RIF (reductions in force) two Dev and five QA positions, most likely underperforming engineers and several managers. Bill must RIF seven positions, targeting the helpdesk, server, and network administration positions, as well a manager. Maxine hopes that Derek will survive this, not to mention her old MRP team.
Surprisingly, Kirsten has put on the table seven project managers, noting that the Rebellion has changed the way teams work. “Long term, we don’t want to manage our dependencies, we want to eliminate them,” she says. “That’s the system of work and the company architecture we need to create, which means fewer project managers. Maxine has shown repeatedly how this can be done. And we have so much further to go.”
On the one hand, Maxine is impressed by the professionalism being displayed by everyone in the room. But hearing some of the names being proposed for the RIF and being held up as the reason to let go more of Kirsten’s team, Maxine feels like she’s going to throw up again.
“You’ll probably have to cut even deeper than you think,” Erik says from across the table, speaking for the first time since the meeting started. Maxine had nearly forgotten he was there.
“Oh, great,” Bill says.
“Last time we met, I mentioned Sensei Geoffrey Moore’s Three Horizons, but I didn’t have time to explain his concept of Core versus Context, which are what the Four Zones are about,” Erik says. “Sensei Moore observed that many businesses understand the Three Horizons but are still unable to properly invest in the next generation of innovation. In other words, they underinvest in Core, because they are being controlled by Context.
“Cores are the central competencies of the organization. These are things that customers are willing to pay for and what investors reward,” he says. “Context is everything else. It’s the cafeterias, shuttles between buildings, and the thousands of things companies must do to operate. They’re often mission-critical, such as HR, payroll, and email. But our customers do not pay us for the great payroll services we provide to our employees.
“Not properly managing Context is what Sensei Moore called the killing ground of great companies. Companies who become too burdened by Context are unable to properly invest in Core. There is a strategy for transforming a company, but it also takes ruthless focus and tenacity.”
Erik looks at Bill and Steve. “You know that technology must become a core competency of this company and, indeed, that the future of Parts Unlimited depends upon it. But how much of the $80 million of your technology spending is Core, actively building competitive advantage, and how much of it is Context, which is important and maybe even mission-critical, but still needs to be standardized, managed down, and maybe even outsourced entirely?”
Bill bristles, turning red. Up until now, he always appeared remarkably stoic and reserved, but apparently Erik had touched a nerve. “You’re talking about outsourcing? After all we’ve been through, Erik, haven’t we already agreed that outsourcing IT has caused many of the problems we’re currently cleaning up?”
“Hardly!” Erik scoffs. “You’ve all proven that you can jeopardize the First, Second, and Third Ideals plenty without outsourcing. Instead, think of the Fifth Ideal, of being truly customer-centric instead of being silo-centric. As Sensei Moore asks, of the applications and services that you manage, which of them are customers willing to pay you for? Which ones truly enhance competitive advantage? And which can you rely on vendors for?
“A hundred years ago, most large factories had a CPO—a chief power officer—who ran the electricity generation processes. It was one of the most important roles in manufacturing, because no electricity, no production. It was a Core process,” he says. “But that role has disappeared entirely. Electricity has become infrastructure that you buy from a utility company. It is interchangeable, and you choose suppliers primarily on price. There is rarely a competitive advantage to generating your own power. It is now merely Context, no longer Core. You don’t want to be the organization that has a large staff providing internal power generation.
“As Sensei Clay Christiansen once stated, one keeps what is ‘not good enough’ and outsources what is ‘more than good enough,’” he says. “Why did you choose to outsource your cafeteria point-of-sale system?”
Bill looks thoughtful, scratching his chin. “I had my team work with John, the CISO, to figure out which applications stored PII or credit card data. That’s like toxic waste. We shouldn’t waste time or energy protecting it; we get rid of it. We looked for those applications, and where we could, we retired them. And if we couldn’t, we looked for an external vendor who could run it for us as a service.”
“Precisely,” Erik says, standing up. “I challenge you and the technology team to think deeply about the Fifth Ideal and identify areas of Context that you can unload, freeing yourself from decades of technical debt, things that have been shackling you for years or maybe even decades. Imagine what you can get done without all those things dragging you down. Even though it may be more painful in the short term, you will find some unexpected and critical dividends long term.
“Steve, lucky for you, according to Sensei Moore, the person best suited to manage Context is someone just like Bill and Maxine,” Erik says. “This is never easy. You need someone who truly understands the business, someone hard-nosed who can drive standardization across the company, who truly has the best interests of the entire organization at heart, and who knows what technology can and can’t do.
“Imagine a world where you can make decades of technical debt disappear …” he says. “Where you rid yourself of bad automation built on top of bad business processes. Imagine what it could feel like to deliberately and carefully choose what to leave behind and where you could spend your time and energy instead. Dick knows that simplicity enables effectiveness, and that complexity conspires against it. How much of getting business done here is impeded by your internal systems and processes?”
This makes Maxine pause. The notion of simplifying the business and technical landscape of the company is breathtaking. She loves working on complex business problems, but it would be so much better and easier if they weren’t obstructed by the decades of senseless complexity and accumulated neglect.
“Lastly, to everyone else, especially Steve,” he continues, “think carefully about how each and every position you eliminate might disrupt flow, especially when you don’t have locality in decision-making, as embodied by the First Ideal. For instance, what happens when you get rid of managers when you already have situations like the Square happening all the time?
“Those middle managers are your interface between strategy and execution,” he says. “They are your prioritizers and your traffic cops. We all have this ideal of small teams working independently, but who manages the teams of teams? It’s your middle managers. Some call them derisively the ‘frozen middle,’ but you’ll find that properly developing this layer of people is critical to execute strategy.
“I wish you the best of luck,” Erik says, turning to leave. “And hang in there, Maxine. If you choose wisely, better days are most assuredly ahead of you, however dismal it may appear now.”
Everyone remains silent on the walk back to Building 5. Finally, Maxine says to Bill, “You don’t talk much, do you?”
“Sometimes,” he says with a tight-lipped smile.
“Uh, what do you think of that last meeting?” she asks, the question that’s likely on everyone’s mind.
Bill stops to look at Maxine for a moment. “It sucked ass. On the one hand, it looks so much like the same drill that everyone in Ops deals with all the time. Do more with less. Outsource this. Outsource that. In the past, this has led to some incredibly unwise decisions, and people like us are left cleaning up the mess afterward for years. And when everyone’s realized that we crapped the bed, we often have to bring everything back in-house. There’s nothing fun about that.
“But this time it could be different,” he says, resuming his fast-paced walk. “Steve and Erik are absolutely right. We must find a way to protect the Innovation efforts. That is the key to our long-term future. For the first time in my career, I think we can change the way we manage technology and do it right, with the support of the highest levels of the company.
“But this is not going to be easy,” he says. “I like what Erik said about Context and Core. There are services we should get out of the business of operating. One of the places I’m thinking about is my old mid-range group. We’ve created the Galapagos Islands of technologies, which served us well for decades, but we’ve drifted so far from where the entire industry has gone that we haven’t been able to benefit from all the things the industry vendors have created. Maybe it’s time to build a bridge back to the mainland … or maybe vacate the island completely.”
He continues, “I wonder if we can re-skill everyone on my old team and find new roles for them without driving up operating expenses. There’s going to be a bunch of new positions in the Innovation effort. I want them to have a shot at it. They have so much domain expertise and institutional knowledge. It’d be a huge loss if we lost them. Same with Kirsten’s project managers …”
Bill continues to think in silence as he walks. Which is fine, because Maxine is feeling even more troubled than before. Has her old MRP group become inhabitants of their own Galapagos Islands too?
“I think this all sucks,” Kurt says, brooding.
For the rest of the day and into the next, Maxine and Kurt tag along as Bill, Chris, Kirsten, and their teams struggle to come up with a plan to deliver the needed headcount reductions. Although Steve told Dick that his job is to help both sides of value and growth, Dick assigns two of his direct reports, the director of business operations and the corporate controller, to help them.
Maxine is very impressed by them. They are two hard-nosed business people who seem to know every nook and cranny of the company.
But it’s still very grim work.
Maxine is often tempted to take a walk or skip these meetings entirely, because she sometimes feels overwhelmed at the human toll that all of this has put into motion. But she knows that this is important, even critical, to get right. And she absolutely wants a say in what happens.
At first, each department manager divided their people into three categories: critical, desired, and RIF. Of course, only a few people ended up on the third list. Seeing the three names, it was clear that managers were using this as an opportunity to get rid of people that should have been eased out long ago.
But that wasn’t nearly enough. So Chris and Bill started turning the screws on each manager, scrutinizing and comparing people on their managers’ “desired” lists. After nearly an hour of this exhausting wrangling, Maxine is reminded of something Erik said.
“Wait. Erik cautioned us on the need to examine things from the perspective of flow,” Maxine says. “We can’t do this by department or by some popularity contest. If we take random people out of a value stream, we could do as much damage as what the bean-counters did in Dwayne’s story of the three manufacturing plant network switches.
“And in our world, where we currently don’t have sufficient locality in our decision-making,” she says, “it’s actually our managers who are figuring out how to expedite the most important work. Erik called them the traffic cops and prioritizers.”
Both Bill and Wes stare at her. Bill says, “Good idea. Let’s put this aside for a moment and instead focus on trying to distinguish Core versus Context. What are the broad areas of technology that we can eliminate?”
Maxine is acutely aware that the ultimate goal of this exercise is to reduce operational expense. They need to reduce the number of people on payroll.
Obviously, unhappy at being asked to figure out how to dismantle the empire that he’s helped build over the last decade, Wes mutters, “This feels so wrong, Not so long ago, these were things we were arguing we needed.” But even he acknowledges that there is an urgent and important business imperative to do this. When he sees Bill put up his old mid-range group on the list of candidate technologies to eliminate, he groans.
“Holy crap. I’m sorry, Bill. That’s rough,” he says, staring at the whiteboard. “Sure, I’ve made fun of them for being frozen in time like Encino Man, but they’re good people. And I sure haven’t had any reason to complain about their work.”
“Thanks, Wes,” Bill acknowledges. “But honestly, there are SaaS vendors out there who we can pay to do much of what we’ve built. And that will give us five people. And we’d eliminate a whole technology stack, along with all the software licenses and maintenance contracts associated with it. That’s another $100,000 of annual spend, which is another half of a head right there.”
Wes sits in silence. “Well, if you put it that way … I’d pay anyone in duffel bags of unmarked bills to get rid of our helpdesk system. Of course, we’ll have to get a replacement service, but I’d rather have a vendor managing it anyway. And our email servers. And Lotus Notes, which we still have pockets of, believe it or not, because a couple managers complained loudly. I think we finally have the clout to override their objections.
“Combined, the workload of managing all those things is easily three people,” Wes says. “Of those, two I’d want to keep around. All I’d want is the opportunity to take a sledgehammer to some of those servers before we haul them out.”
Maxine stares at Wes and Bill. They’re not exactly being magnanimous, but they aren’t being cold-hearted bastards, either. In fact, she much prefers this approach to comparing lists of names between departments.
Inspired, Maxine gathers up her courage and says, “Maybe we should take a look at the Manufacturing Resource Planning group too.” When Chris looks at her in surprise, she says, “There are certain pieces that are absolutely critical for competitive advantage, such as the scheduling module that we’re changing from ‘build to forecast’ to ‘build to order’ to support on-demand manufacturing. But the rest of it could be moved onto a commercial package … I’d keep five developers on the team to finish the transition, but that would free up ten developers and QA people, and maybe two other Ops people …”
She feels ill. The people she’s reduced to numbers are the wonderful people who wished her well when she was exiled. This was the system she helped build and maintain for nearly six years. Even Erik said it was an architectural marvel.
She quickly adds, “These are some of the best engineers in the company. I personally vouch for each and every one of them. If they could work on projects like Unicorn or in the Innovation areas, their contribution to the company would be much higher than on the MRP system …”
“You’re right,” Chris says, looking proudly at Maxine. She feels relieved to finally suggest this, which is something she’s been dreading all day.
Bill adds Maxine’s old MRP group to the whiteboard, joining midrange financials, cafeteria POS, helpdesk, email, and Lotus Notes on the list. Together, they identify eighteen positions that they can eliminate. The software services to replace them would cost $500K annually.
Bill adds another column. “If the Innovation effort is fully funded at $5 million, that could potentially create thirty-three technology positions in Core. We could potentially hire all these people back, as Maxine pointed out, doing work that is far more valuable.
“So, let’s keep pushing. Come on, what else might we want to unshackle ourselves from so that we can reallocate more people to Core? What are things running in our datacenters that customers will never pay us for? We’ve already outsourced payroll. What other back office functions might we want to consider?”
“We have three ERP systems,” Maxine offers. “It’s a pain to have to integrate with all of them. In fact, all three of them are owned by one company now. Maybe now’s the time to bite the bullet.”
Wes nods. “If we switched to one, that would free up another two or three Ops people to do something else.”
“I like where this is going,” Bill says. “How about our HR systems. And sales commissioning tools and compensation planning … and our timecarding systems in plants …”
At the mention of the timecarding systems, which were at the epicenter of the payroll failure that led to her exile, Maxine mutters, “Good riddance.”
“Yeah, and our desktop backup systems,” Wes adds. “Maybe even our telephone systems and PBXes. We’re a manufacturer and retailer, not a phone company …”
Wes’ face lights up. “And there’s two datacenters that we should have shut down years ago. Between them and what’s in them, they probably cost us a million dollars annually to run. And if we actually got rid of them, that’s another four people … Oh, and those damned Kumquat servers … Let’s get rid of them once and for all. That’s another $100K in maintenance costs.”
Looking at the growing list of ignoble Context on the whiteboard, Maxine doesn’t feel dread. Instead, she feels inspired thinking about how jettisoning these things will liberate the company from things that slow it down and present the opportunity for engineers to work in areas of far higher value. There is one more thing bothering her, though.
“Our Unkitty CI cluster is on its last legs,” Maxine says. “It’s important Context, but still Context. We have our best people working on Unikitty. It’s made a world of difference elevating developer productivity, but we should find a commercially supported SaaS vendor and get our best people working on things that we can’t find commercial vendors for. Come on, Kurt, how much time have Dwayne and Brent spent propping Unikitty up?”
“Damn,” Kurt says. But after a moment, says, “But yeah, add it to the list.”
Dick’s finance team presents their tabulations. Everyone stares. They’ve identified nearly $4 million of expenses that could be reduced, with twenty-six positions being eliminated.
But if they opened up thirty-three positions in Innovations, they could hire almost all of them back. If they were willing to learn new things.
Maxine is amazed by how quickly Bill is able to get on Steve and Dick’s calendar, impressed that he has that type of working relationship with the CEO. They are presenting to both of them by the end of the day. In contrast, there are times when it takes weeks for Maxine to get on Chris’ calendar. She briefly wonders if the problem is her or Chris.
When Bill presents their plan, Steve and Dick take notes, ask questions, and eventually nod in approval.
Steve especially liked how the team identified areas to eliminate by value stream while maintaining flow. But when Bill talks about their desire to move talented engineers and retrain them so they could contribute to the Innovation efforts, Steve becomes visibly excited.
“During my manufacturing days in the 1990s, I had to oversee a massive reskilling of the workforce,” he says. “We made huge investments to make sure every worker could survive and thrive in a new era where everyone was being paid not to just use their hands but also their heads. It was one of the most fulfilling and rewarding things I’ve ever done. We must do the same with the technology workforce.
“And I don’t mean just putting up posters on the wall,” he says. “I mean we really invest in our people. Maybe we create a Parts Unlimited University or some other long-term training where we create the next generation of leaders and engineers we need for the long-term survival of the company. We pay them to get the skills they need.”
Steve looks excited and alive in a way that Maxine has never seen before. Even Dick looks excited.
“I need your help on this one already, Steve,” Bill says. “Take my old mid-range team that I used to manage only four months ago, before you put me in this role. Through no fault of theirs, they’re in a business process that is Context, not Core. We need to do right by all our people and help make sure that we prepare those people to have long and productive careers. They have valuable knowledge that we’d be idiots to let walk out the door.”
“You bet,” Steve says. Maxine breathes a sigh of relief. Maybe this whole thing can be a force for good after all, Maxine thinks. Even though it was Sarah who lit the fuse.
Dick has been taking notes and occasionally tapping on his calculator. “We need $15 million in cost reductions. With the numbers you provided, we’re nearly there,” Dick says, looking at his staff, who nod in return. “In manufacturing, we’ll be shutting down production of our lowest-margin category of products. This affects fifty workers, of which fifteen will be filling currently open positions.
“The head of supplier management plans on saving another $2 million by reducing our number of suppliers,” he says. “We’re using this to negotiate higher discounts and reduce logistics overhead, and it shouldn’t create much hardship at all.
“On the retailer front, we’ll be shutting down ten of the lowestperforming stores, which will save us about $3 million,” Dick continues. “And the rest will be gained through early retirement and some elimination of positions.”
Dick pauses to look at the spreadsheet. “I think this is a pretty good plan. The biggest risk I see is the operational risk from transitioning to these new systems. They’re Context, but they’re mission-critical. We’ve never changed this many business processes, let alone all at the same time. And I’m sure we’re going to have a bunch of very unhappy people who will come up with a bunch of reasons why we can’t.”
“Just so you know, some of those objections are undoubtedly correct. This is just a working list, created by us, a bunch of spreadsheet jockeys,” Bill says. “At our level, we don’t really know what the implications of shutting these systems down are and what it takes to transition. We need time to work with our teams to figure out what’s even possible and come up with a realistic timeline.”
“That’s a good plan, Bill,” Dick nods. “Steve, you need to find a way to buy him some time.”
Steve looks at the spreadsheet on the screen. “Maybe we ask the board that instead of the three percent cut they asked for, we deliver a plan to cut two percent in January before the quarterly earnings announcement and get to four percent by the end of the next year. That should satisfy them …”
“Not bad,” Dick says with a smile. “That will make Alan and his voting bloc very happy.”
“Okay, I’ll work on socializing this with the board,” Steve says. “Once we get approval, I’d like to announce this to the company and be as open about it as possible, so people can prepare for it.”
To Dick, he adds with a small smile, “Sorry, Dick … We may need a couple more quarters of that financial engineering to keep the numbers going in the right way.”
Maxine is so relieved that her worst fears about the cost-reduction plan haven’t come true. However, she doesn’t feel carefree. Instead, her acute fears of the worst happening are replaced with a dull, constant, gnawing sense of unease.
For the rest of the day, she feels utterly spent and exhausted, her left eyelid keeps twitching and her stomach constantly hurts. Sometimes she can’t quite look people in the eye. A quick Google search confirms that this is probably all due to prolonged stress. All these types of people management issues are why she always veered clear of management roles.
That night, she forces herself to relax, having a couple of glasses of wine and watching the “Red Wedding” episode of Game of Thrones with her husband, eager to be distracted from anything related to work. She’s stunned by the ruthless cruelty and senseless violence of the massacre at the end, and she and Jake laugh about how lucky they are that modern work environments don’t involve wholesale slaughter—even though Sarah had certainly given it her best shot.