Manage outcomes, not people
Successful delivery is about people. As we all know an organisation can have the best and most innovative ideas, but unless it has the right people on board to deliver them, the business will fail.
Matt Hatton, MD at Rainmaker shares his view:
It’s people who make things happen, and good people simply find a way to deliver. During the four years I spent working on the London Olympics, I saw this time and again. If there was a single factor that made the Games successful above any other, it would be because they attracted the top people across every field.
However, a key point for me is that it is not so much about individuals as about teams. Good people get things done, but it takes high-performing teams of people to achieve great things. Building a good team is singularly the most important factor in any successful delivery.
More than the sum of its parts
It’s not simply about how good each individual is. How many times have you seen a team fail despite the fact that it includes some excellent people?
On the flip side, think about the successful teams you’ve seen or been part of — I’ll bet that not everyone in that team was a ‘star’ in the organisation. Teams are collections of skills, capabilities and experience. And perhaps more importantly, they are social melting pots of relationships, feelings, egos, sensitivities, group dynamics and affected behaviours. Even teams stacked with the high-calibre individuals need good leadership and thoughtful management, often more so.
Take sports for example. How often do you see a team turned around completely in terms of collective performance simply by changes in management or team dynamic? Too often for successful performance to be chalked up to the collection of individuals.
Too often there is not enough thinking involved in the formulation and management of a team to allow it to perform to its best potential. At times, I see collections of individuals, each with a lot to offer, but no cohesive understanding of who is doing what, or where each other’s strengths and weaknesses lie, and how these factors come together to deliver the desired outcomes.
Managers want ‘good people around them’ but don’t have time to deal with the the division of labour or emotional sensitivities. Fine, but don’t expect those individuals to deliver the outcomes you’re looking for.
High performing teams
Without a good team, any strategy or project will fall apart. For this reason, all stakeholders, including the key project staff, expert resources, suppliers and third-party partners need to be a part of the team. Everyone involved must buy into the same vision, have commitment to the group and strive for overall excellence. Setting up these teams for success takes experience and expertise.
Rainmaker’s experience spans a range of different clients for whom we provide both individuals or established teams. The key differentiator is, whether team or individual, we sign up to deliver the results they are aiming for. Some still opt to buy individuals and tackle the ‘team’ dynamics themselves and, as a buyer at various stages of my career, I understand being suspicious of companies who are offering teams or ‘fixed-price’ solutions.
Anyone who has had experience of large suppliers who, under scrutiny, had to expose exactly how much risk and contingency were really contained in their ‘fixed-price’ contracts, will understand this reticence.
But it’s a misconception to think that buying individuals means getting the necessary resources more cost effectively. In my experience this is not true, a ‘time and materials’ day-rate approach can easily cost far more than an outcomes-based approach, particularly if those involved are expected to deliver against an ill-defined set of loose objectives.
There can be legitimate arguments in favour of recruiting individuals. Flexibility for example. Occasionally there just isn’t the stability in strategy or organisational context to permit a clear enough view of the desired outcomes. In these circumstances it does make sense to work through these challenges with some good people, who can get things under control and enable a clear view of priorities and outcomes.
However, businesses need to be careful this doesn’t become the ‘norm’ as, over time, a maelstrom of individual agendas and interests can muddy the waters of what’s really needed and prolong the period of uncertainty.
An outcomes-based approach
I have seen many examples of successful delivery and team building based on individual sourcing over the last 20 years, largely as a result of strong leadership. More often than not though, I’ve seen large numbers of individually recruited contractors and consultants drifting without clear leadership and thus failing to deliver.
For all these reasons, clients are waking up to the benefits of buying an experienced team, tasked and rewarded against the delivery of a clear set of outcomes. The key is ensuring the contract is structured around outcomes that are clearly defined at the right level, rather than numbers and types of people, and of a manageable scale.
Probably the biggest plus is the transfer of delivery risk to the supplier. Now they have to do the hard work of finding and managing the team, ensuring access to the right skills, both fixed and part time, and managing the softer people aspects to ensure the results are delivered. Clients may fear loss of control with this approach, but in reality, you get to focus on the quality and the detail of the work, ensuring deadlines are met and outcomes delivered, as opposed to mollycoddling egos and handling personnel issues. This is especially effective if you link payments to results.
A team is also far quicker and easier to buy. Separately recruiting a team one-by-one, is a far more onerous task than a single activity to acquire one that is ready to go. Transferring that effort to a supplier makes sense if you need to make progress quickly, and with increasingly transparent markets, you are much less likely to pay a supplier a large premium for risk values or contingencies. The biggest savings however, come from the ability to budget accurately and measure results against outcomes.
Moreover, by driving the supplier to integrate with your in-house resources, you can achieve additional benefits through knowledge and skills transfer. There are also potential diversity benefits as discussed in The Spectator.
So why don’t we do this more? An outcomes-based approach can deliver better results, save time and money, and avoid the creation of management debt when compared with sourcing individuals.
And with the proposed changes to IR35 perhaps now is the time to consider buying outcomes-tasked teams rather than individuals. It’s the high performing team, not necessarily the specific talents of the individuals, that is key to success.