Critical Path Newsletter

Snow shoveling theory II: Contracting out

When I was helping Martin Larochelle with his "Snow shoveling theory of software development" Critical Path, I flippantly suggested adding the following line “Some folks contracted out their snow removal (We’ve always said you should outsource non-core competencies. Very efficient!)”.

I had no clue how that line would come back on me over the course of the winter.

I live in a townhouse with a two meter/four foot wide lawn. I joke that I pay to have my driveway plowed so that I can drive to the gym to exercise—but that’s not the truth. I hire a contractor to plow my driveway, not because I’m lazy, but out of necessity. The space I have to put the snow is smaller than my driveway. By the end of February, the snow pile is higher than my head and I can’t bend the laws of physics to pile more snow on top.

I’d decided at the end of last winter that the contractor I’d hired last year was too expensive.

So, when I found another contractor’s brochure in my mailbox, offering a low rate and a discount for paying the full amount early, I jumped at it.

Around the middle of December, my great deal started to sour. The contractor came once, no problem. The second time they were late, but I understood—they had a lot of houses to do and I couldn’t always be first in line.

The third snowfall of 2007 was legendary. Forty centimeters/sixteen inches. When they didn’t come at first, I didn’t worry too much—the city hadn’t plowed the road, so I wouldn’t have been able to get off my street anyway. I watched a Jeep get stuck, so my Corolla wouldn’t have had a hope. I worked from home.

After a full day of waiting (the street did get plowed), I’d had it and went to my contractor’s website to find their phone number and call to see what was going on.

I found this (Their spelling mistakes, not mine.):

“We regret to inform our customers that due to equipment failure we will be unable to service our clients until further notice. […] When we can SAFELY be back on the roads and in our customers laneways we definately will be. We apologize greatly!”

And I bundled up to head outside, shovel in hand.

Over the next couple of days I spoke to a few people about the contractor.

“Oh no,” I was told. “You didn’t sign up with him! He didn’t fulfill his contracts last year!”

Well, crap.

As you might have predicted, service did not resume. (If you’ve never had to shovel snow, you might not realize why this is a big deal. If that’s the case, just imagine a lawn mowing company leaving 1400 customers in the lurch. And the grass being so high that some senior citizens can’t leave the house.) A lot of bad press ensued—some of it mentioning that the exact same equipment failure had happened the previous year, a very big coincidence.

I googled the company and turned up articles about their poor service going back several years. Around the same time, people on my neighbourhood community loop began posting complaints and warnings about them.

I held out some hope that the contractor would turn up… eventually. But my story has a sad ending. In January, the city revoked their license permanently.

By this point, you’ve probably already figured out why this article is a Critical Path. I’ve never hired a software outsourcing partner, but if I ever have that chance, I’m definitely going to apply the lesson I learned from hiring a snowblowing contractor.

Partner with someone you can trust.

Maybe it’s simple, even common sense. But sometimes the simple things are ones we need to review from time to time. Most development companies are honest and open—and therefore assume that everyone else is.

Assuming people are honest without any proof can lead you to bad decisions. For example, we’ve seen development partners say that they are based in North America who turn out to only have a sales force in North America, and development takes place offshore.

Not that it’s automatically a bad decision to hire offshore—but it’s a bad decision to hire someone who starts out lying to you.

You can’t trust just anyone. You’ve got to figure out who is trust-worthy.

The problem, of course, is finding out if the potential partner is worthy of your trust, if they will do what they say they’re going to do.

That looks like a tall order, but it’s actually not. It’s easier than you think, taking little effort, and you already have the resources to do it. Just look into the potential partner’s track record.

Internet resources
For my snowblowing experience, a quick search on the Better Business Bureau website would have told me:

• their BBB status had been revoked (and they had been sent a cease-and-desist order to remove the BBB logo from their site)
• the consumer complaints about them number in the hundreds since 2005

Just googling the company’s name would have sent me to several newspaper articles and a television news story on their unreliability.

For a potential software development partner, start with a Google search and see what comes up. Chances are you won’t find the warnings that I would have, but maybe you’ll find press releases to tell you if they are reporting a profit, or partnering with reliable companies.

You might be able to read employee blogs or see employees answering technical questions on forums, which will tell you that employees are excited and engaged with their work. It can also help you gauge their level of technical knowledge.

News stories will tell you more about the company’s values and policies. Articles and newsletters can give you a feel for the company’s attitudes and philosophies—what it would be like to work with them (and of course the best ones are entertaining and well-written). Speaking engagements and customer testimonials are also good signs.

Word of mouth
If I’d only asked a few key friends about this company, they would have warned me off.

If you’re considering an outsourcing partner, ask your trusted network to see if anyone has worked with the partner, and if they had a good experience. If you can’t find someone right away, ask your network to ask their network for a recommendation.

Check out the case studies on the partner’s website—perhaps you can find someone in your network who can connect you with someone at a company who has worked with them.

It’s possible that you won’t know anyone—or anyone who can connect you with someone—who has worked with the partner. In that case, ask the partner for references, and actually phone those references to investigate them.

Build trust with a short project
When I got the snowblowing contract, I immediately signed up for the full year to get an extra discount—that discount literally cost me twenty times what it was worth. If I’d been more cautious and only paid for the first couple of months, I’d have more money in my bank account now.

When you’re engaging a software development partner for the first time, it’s okay to be a little cautious. Instead of outsourcing the core of your flagship product, start with a small component and/or a short iteration and see how that goes before committing yourself.

Maybe my snow removal story doesn’t have a completely sad ending.
I did end up getting a good deal of exercise—as of today, this has been the snowiest winter in Ottawa since 1971.

But if my experience helps Critical Path readers have a better experience by seeking outsource partners they can trust, then it wasn’t wasted after all.