Category Archives: Business

Why I can’t raise the bar at every firm

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It may seem counterintuitive. If I am not the best solution provider, why on earth would I highlight it?

I believe by pointing those cases out, I also underline the clients and problems that I’m particularly well suited too, and for which I can really provide value. Read on!

1. People Problems

Sometimes, you’re hired to solve a particular problem which is framed as a technical one. Some process needs to be reworked, recoded or retooled. It’s framed as a technical problem, yet as things unfold the client already has the expertise in-house to solve & write the code. What then?

It may be that the right people aren’t communicating, project managers aren’t seeing the issues, or part of the human systems are gummed up. We can’t raise the technical bar, but we can help getting those folks talking.

I wrote about this before in When You’re Hired to Solve a People Problem.

Also: Why are oil spills & financial instability related to datacenter outages?

2. ORM Usage & Technical Debt

If you’ve read my blog you know I am not very fond of Object Relational Modelers.

I would also argue as Ward Cunningham does so elloquently that technical debt can be a real and pressing problem.

Here we would help identify and frame the problem, though the work of raising the bar technically involves the longer process of retooling & refactoring your code base.

Related: Why database choices are tricky

3. Where Commodity & Offshore Works

Some firms are already making use of odesk or offshoring resources, where you might pay as little as $150/day. If you have a very technical manager or CTO, such a solution may work well for you.

At the other end of the spectrum are the high priced senior consultants from firms like Oracle, Percona or Pythian. Yes they may set you back as much as $3500/day.

In those cases a scalability & performance review may make sense. Here’s how.. Although specialists are necessary, remember to ask yourself Why generalists are better at scaling the web.

We sit in the sweet spot between the two options. With low overhead, our prices are more affordable. At the same time you’re getting a whole lot more than a commodity solution. We’ll communicate in plain language with folks at every technical level. And for many firms that in itself is a value add.

Check this: Does Oracle Aim to Kill MySQL?

4. Existing team did their homework

Believe it or not, I’ve gone into consulting engagements where the existing team has really really done their homework.

In those cases it becomes much harder to raise the bar technically. In those cases I can help when existing team missed something. But more importantly, I can validate a correct setup, or identify technical debt.

Having an outside perspective then, can provide reassurance. As I see ten to fifteen new environments per year, I’ve seen hundreds in the past decade & a half. That’s helpful perspective in itself.

Read: Does Oracle Aim to Kill MySQL?

5. Availability & Uptime Are Already High

I wrote in depth about high availability in the Myth of Five Nines

At the end of the day, availability can only approach perfection, not actually reach it. That’s a property of complex systems. If your uptime is already extremely high, again we can validate your environment, review and provide & summarize findings. But we may not be able to raise the bar.

If that’s you, it’s a good problem to have!

Also: Why AirBNB Didn’t Have to Fail

Get more. Grab our exclusive monthly Scalable Startups. We share tips and special content. Our latest Why I don’t work with recruiters

Why cloud computing is the spotify-cation of hosting

dvd collection

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1. Music collections of old

Way way back in the 70’s I remember riding around in a VW beetle. Maybe I’d be driving
with my dad or my uncle. Everybody seemed to own a VW! What everybody also had was a huge collection of 8-track taps in a big box. You’d dig through the box and find what you wanted to play, then pop in the tape. It was exciting because before 8-tracks you only had records, and you couldn’t play those in the car!

But even record collections were new in the 60’s. Before that, most music was consumed live or on the radio.

Also: Why a killer title can make or break your content efforts

2. When books left the library

A similar trend followed for books and reading. Although newspapers have been sold by subscription for a lot longer, books were mostly consumed in libraries. But the consumer itch to build collections eventually built Barnes & Noble into a powerhouse brick and mortar store.

Internet disruption of that business model came too. Enter Amazon’s Kindle. Although you theoretically *buy* digital books, if you read the fine print you’ll see you actually rent them in perpetuity. In fact there have been cases where Amazon has reached into devices and removed previously purchased media.

Related: Why AirBNB didn’t have to fail

3. Managing collections (even stolen ones) is hard work

When you download music or movies, either from iTunes or god forbid grabbing it off of Bittorrent networks, you need to put it somewhere. You’ll store it on your laptop harddrive or if your collection is large enough, on some shared storage system at home. And you’ll also probably never back it up.

The thing is harddrives themselves have a life of about two to four years. As an operations guy I manage data everyday. Backups are a big part of that process, so when the media fails, you won’t lose the collection of movies & music you built lovingly over so many years.

Sadly most people learn the hard way. And when you learn this lesson you probably think, where did all that time go? What did I even *have* in my collection?

Also: Are SQL Databases Dead?

4. Why music & movie theft was just a blip on the historical radar

I’m also a bit of a Doctor Who fan. Since it’s a rather obscure British TV show (or was) I spent some time buying many of the old episodes on DVD. Or I *did* rather, until Netflix starting offering the whole classic collection on subscription. They did this with Star Trek too. Now I have no reason to fish through my shelves for a DVD. Why would I?

As users become more accustomed to the subscription model, they’re less likely to want to build a whole collection of media. This goes well for books, music & videos. Who would bother downloading off of Bittorrents, managing your home collection, and all that trouble when you can just subscribe. Easy. No mess!

Read: Why Oracle Won’t Kill MySQL

5. Subscriptions, subscriptions everywhere!

Whether you managed a datacenter of physical servers in-house, or bought servers managed by a hosting company before the subscription model you had to worry about moving parts. You had to worry about failing harddrives, memory & all the rest.

Then along comes Amazon Web Services and it’s EC2 servers bringing the subscription model to hosting too. This raises the bar on the biggest failing component harddrives, but putting all data on EBS, their virtual storage network. All of this raises the bar for a lot of organizations and reduces the drudgery.

What spotify is doing with music, Netflix is doing for movies & tv shows, and kindle is doing for books. That same trend has brought great disruption to the internet & server hosing. Startups and consumers win big in this game.

Can you think of any businesses where a subscription model might work? They may be ripe for disruption by a new startup.

Check out: Why your startup is failing at Devops

Get more. Grab our exclusive monthly Scalable Startups. We share tips and special content. Our latest Why I don’t work with recruiters

How to do technical assessment for a merger acquisition

tsmitty11 big eats small fish

Join 15,000 others and follow Sean Hull on twitter @hullsean.

My newsletter goes out the first few days of every month. I invite everyone I’ve ever worked with, so many of my present and former colleagues & clients receive it. I often receive a few emails in the days following, with requests for help, advice & expertise.

Recently I was referred on a merger acquisition project. The project involved evaluating the technology of the target company, to understand how it would fit in with existing infrastructure, and what challenges they might face.

1. What’s your tech stack?

The scope of the project included evaluating existing application code. We looking closely at:

o What programming languages & versions were in use?
o What volume of code was there, when was it built, and how was it maintained?
o Was the code well commented & organized?
o Are those languages or technologies popular in the marketplace today?
o Are the foundation technologies still supported, either commercially or by open source communities?

Related: When you’re hired to solve a people problem

2. What’s your team stack?

One of the points that came up during the discovery phase was subject matter expertise. We found that the acquiring company’s DNA was around Windows, SQL Server & IIS. Their applications had been developed mostly on C#, so their team had skills around that stack.

The target company, on the other hand was Oracle on Unix. Here the team & expertise had a different heritage.

These two stacks have very different people & cultures behind them. Those would likely introduce unique challenges were you to merge those two firms, as the former would not have skills and expertise to manage & maintain the latter. Trimming teams down, or consolidating hardware & components would likely prove challenging.

Also: A CTO must never do this

3. Where are your pain points

We also evaluated current problem areas in the target application.

o Where were team members struggling most?
o What type of performance problems existed?
o Was there data mismatch or redundancy?
o Were business units struggling in some area to report on the data they needed?

Read this: When you have to take the fall

4. Style of software development

In software development, the traditional building model is called waterfall. It involves specing out requirements, spending a long period writing code, and then releasing it all at once to be tested & deployed. Typically during development period, there isn’t a working version of the system, as it’s undergoing change.

The risk with waterfall is that what comes out the other end won’t be what feature specification teams envisioned. Worse still is when the resulting product is full of bugs, or has major performance problems. The ACA used this method to develop healthcare.gov website, resulting in a whole host of problems on launch. It’s why I’ve advocated for real techops at Healthcare.gov.

These days, the modern and arguably superior model is called agile software development. This involves writing code in much much smaller chunks, and for each releasing a small test to verify that it performs it’s function. These unit tests allow for software to be continuously deployed, perhaps multiple times per day.

Check this: How we do a performance review

5. Legacy or Open Source

A last point of evaluation is the use of legacy software components such as Oracle, versus the more nimble and open source components many internet firms use, such as Linux, Apache, MySQL & PHP or Python. These later components make the stack of many modern web facing applications, are supported by the internet community, and provide flexibility & configurability in the cloud.

Fred Wilson has advocated for Open Source in various postings on his A VC blog. Although these technologies offer great opportunity & strength, your team may not have experience bushwacking through the DIY world of open source and that would be a major consideration for a merger.

DNA and culture of the acquiring company, and the target company have a huge impact on whether those technologies will all play well together as the firm grows up.

Also: A sample executive summary we did for Acme Startup, Inc.

Get more. Grab our exclusive monthly Scalable Startups. We share tips and special content. Our latest Why I don’t work with recruiters

The four-letter-word dividing Dev and Ops

devops divide

What’s that word?  RISK

Operations teams are tasked with stability and uptime. That means working against change, limiting or slowing it down where possible.

Developers are tasked with features and delivering business solutions. For that an ORM layer seems appealing for example. It speeds up & simplifies coding. At the same time it eliminates database drudgery.

For ops who are tasked with uptime, an ORM is a force against scalability. I’ve outlined five things toxic to scalability. They work against performance.

The question remains – do devops folks solve the problem?

Consider the banking crisis

Bankers are tasked with making money for their shareholders. To do this they innovate with financial products. Though you may argue they are unscrupulous at times, capitalism and shareholder value drive them to find profit.

Meanwhile the government’s job is to provide a level playing field.  They enact rules, regulate and provide oversight and auditing. As with operations, this is a conservative role, that avoids risk, and seeks stability, growth and avoidance of recessions and depressions.

These tradeoffs exist in many disciplines. The trick is how we find the balance.

There is an equally interesting question of decoupling in internet architectures. I’ll write a future piece on similar parallels I see in the economy at large.

Ask Me Questions – Scalability, Performance, Cloud Computing

 

 

I blog a lot about various topics near and dear to me.  So I thought I’d turn the tables a bit, and offer the microphone up to readers.  Do you have questions on any of these topics?  Feel free to drop a note in the comments.

 

Business & Consulting

Are you a freelancer or independent consultant?  Struggling with some part of the business?  Or are you a CTO or Director looking to hire short term talent?  Glad to offer up advice and suggestions, just fire away!

Scalability

The goal of every hypergrowth company, from Pinterest to Facebook, Zynga to FourSquare.  How do they achieve it?  What architecture decisions make those applications grow effortlessly to meet user demand?  I’m sure you have some questions!

Performance

It’s on everyone’s mind, especially in the context of deploying in the cloud.  How best to achieve good performance?  Are you struggling with something specific?

High Availability

We want our systems to be available 24x7x 3million days a year!  Is it feasible?  What should we aim for in the real world?  Does our technology mix and hosting factor into the equation?  Ask away.

Startup Challenges

I’ve worked with a lot of startups over the years.  From the dot-com hey days to the more sober field we see before us today.  Many struggle with similar challenges.  Am glad to offer up comments and suggestions from what I’ve learned over the years.

Cloud Computing

What really works in the cloud? Is Amazon EC2 the only way to go?  What are the pros and cons of going with a Rackspace type provider that also has great service and the physical data center option?  How will I get good performance?  These and other questions are on everyone’s lips.  Feel free to comment if you have some concerns.

 

Business lessons from brokering a half million dollar deal

I’ve had my Manhattan loft in the market for some six months now. After dropping the asking price a couple of times, buyers are finally circling, and I’m close to finalizing a deal.  In that time however, I’ve learned some big lessons.  Real Estate, is the epitome of cutthroat capitalism and as such has some very potent lessons to teach about business.

Understand Interests – Two Sides to Every Argument

Brokers have an interest – to make their fee;  buyers have an interest – to lower the selling price, sellers have an interest to get the highest selling price.  On the surface this may seem self evident.  But dig a little deeper and you’ll learn more. Brokers are somewhat aligned with buyer and seller, but like a cab driver preferring lots of short trips, their incentive is to do more deals. Fewer deals with higher margins would actually cost them. A 1%-2% higher selling price may be significant to your bottom line but meaningless to theirs.

[quote]Business Lesson 1 – Pay close attention to each party’s interests and you’ll understand the negotiating dynamic more clearly.[/quote]

In brokering, like war, no one plays fair

Each industry has it’s own ugly side. No one calls back. No one emails back. There are no pleasantries. In some businesses where credibility and reputation are built over time, people do care–little bit. But in brokering a large deal they don’t.  Silence means “Hey, thanks for going out of your way to give us an hour of your time even though we were late.  We don’t care.  We no longer need you & we’re not gonna respond.”  Got it, heard you loud and clear!

[quote]Business Lesson 2 – Be prepared for selfishness and deception. In some cases watch out for cheaters and even fraud.  Don’t let this color all your interactions, but be aware that some parties may not have the same scruples as you do and some may even break the law. [/quote]

Markets are bigger than you are

You may think your house or apartment has some intrinsic value, based on renovations or the time you’ve held it, or some other more personal metric. However the market is ultimately what sets the price of the asset. Market trends can swing wildly and irrationally so be prepared to “get real”, as they say in the business.

[quote]Business Lesson 3 – Market forces set the price of a good or service. The door swings both ways so when there is a greater supply be prepared for the price to go down, and when location, asset or skills are in great demand, be prepared for the price to go up.[/quote]

Buyers move on emotion; facts get you only so far

Salesmen tell stories. It’s their job to engage, stir passions, get people to move. Sometimes these yarns are taller than you or I might like, but if people knew exactly what they wanted, brokers wouldn’t exist. This occurs across the spectrum in sales.

[quote]Business Lesson 4 – Pay less attention to the facts and arguments a salesmen presents to you. Only the underlying interest of each party will tell a clear story of motivations. Weigh that along with the market appetite and you should have a good idea of the right price.[/quote]

Protect your interests and time

Over the months I’ve been on the market, I’ve had countless brokers try to sell me their services. An exclusive seller agreement is valuable to a broker as it allows them to control the process and control the fee distribution. One broker made an appointment to come by with their buyer over a holiday weekend. Following up at the appointed time, they explained that they were running late though frankly the broker sounded hung over. Upon arrival they brought no buyer. Seeing my irritation, they quickly fabricated a story about a phantom buyer and their specific requirements. After wasting a few hours of my time and breaking up my holiday weekend, I never heard from them again. Not fun.

[quote]Business Lesson 5 – Qualify your prospect before you grant them your time. There are many parties who can and will waste your time if you’re not careful. Be diligent about weeding them out before clearing your schedule for them.[/quote]

Business plans are bunk

I meet a lot of people in NYC. Friends, colleagues, small business owners, people with a great idea, artists, musicians, people with a dream, people who hear the startup story, namely the Google, Zynga, Apple, Facebook, or Amazon story.

Sometimes I’ll hear:

“I’m working on a business plan.”

“Why?” I ask.

“I want to make my business grow and get investment money.”

Then I think about this a little, and consider if a business plan would have ever helped me.  Would it help a deli owner run a deli? Or a laundry run a laundry?

[quote]The essence of running a large business is the day-to-day of running a small business.[/quote]

Let’s consider a less savory business – drug dealers. Their business may not be one we respect, but let’s consider the economics behind the scenes.

  • They sell people a product they want
  • They sell at a price people are willing to pay
  • If supply is low they get more to meet demand



That’s a business plan in a nutshell. If you’re not selling any product, that means people don’t want it. It may not be as valuable to the world as it is to you. If it’s valuable, people will buy. That’s the measure of good ideas. When people aren’t buying, they’re voting with their wallets.

Entrepreneur and blogger, Andrew Chen says:

Business models are a commodity. The answers are all obvious.

Sometimes all this talk of business plans sounds like therapy for people who don’t have a successful business.

The hard truth is if people aren’t buying they don’t want the product. Change it or tweak it until they do. A business plan won’t help with that.

Best of Guide – Highlights of Our Popular Content

We cherry pick the top 5 most popular posts of various topics we’ve covered in recent months.

Beware the client

Recently I was searching Google for “startup consultant” to see what I might find. I came across this article by John Greathouse titled Beware the Consultant. No self-respecting, hard-working consultant would sit back and take hits without defense, so in true poetry slam style I thought I’d write a quick retort.

Beware the Client…

  • The one that asks for the world.
  • The one that wants everything done yesterday.
  • The one that drags their feet paying bills or loses your invoices.
  • The one that moves the goal posts halfway through a project.
  • The one whose left hand doesn’t know what the right hand is doing.

 

 

Truth is often stranger than fiction

Of course in the real world things are much more nuanced than this black and white picture. Certainly there are probably some consultants that fit John’s description, but there are others that are loved by their clients.

  • There are tons of “little guys”.
  • There are freelancer’s that do a thankless job.
  • Consultants provide much needed plugin solutions for firms.
  • They work as long or as short as necessary.
  • They’re available, when you can’t find anyone!
  • They’re often self-taught – maintaining skills on their own dime.
  • BYO laptop, they’re plug-n-play.
  • They’re communicators – or they wouldn’t succeed in consulting.
  • They are small business owners – so they relate to your real business pain.

 

As far as performance based compensation goes, I would say two things:

  1. It’s always performance based because in my experience the startups I work with are usually bigger than I am. So if they decide not to pay being unsatisfied with the work, there’s little I can do about it.
  2. I do believe in being open to different types of arrangements, sometimes day or week based on time and materials, and other times project based. However the devil is very often in the details with regards to “quantified, clearly understood results”.

 

Although Mr Greathouse may describe *some* real-world or big-corp consultants, they are by no means representative of the lot of us.

Consulting essentials: Building your business

In the last two posts on how to build a successful consulting business I shared advice and tips on closing deals and managing and completing your engagements.

This post will look at where to focus your efforts in order to sustain your consulting business, and build skills.

Focus on your subject matter expertise

Being a subject matter expert takes years of education, and professional experience to build. It’s your most valuable asset. Build it, and use it. This is not to say there isn’t great value in being a generalist as I’ve emphasized in blog postings. But don’t get distracted trying to do things others can do better. Web-based newsletter managers can do it better than you can, professional invoicing solutions as well. Though you might be able to do a bit of HTML and graphic design, if that’s not your expertise, hire someone to do your website in WordPress. You’ll save time and money in the long run, and their professional experience will surely include a few surprising nuggets of value that you wouldn’t have known yourself.

Manage your business with online tools

There are a myriad of online tools to help you run your business better.

Google Analytics – Get insights on what parts of your site your customers find valuable. Learn to convert those visitors with downloads, newsletter signups and ebooks for sale.

Freshbooks, Zoho or Paymo – There are many online invoicing solutions, so best to evaluate them for your specific needs. The point is, using a solution will save you money in the end, and make you more professional in the process. It’ll help you track monthly & yearly, send reminders, and summarize things for you all in one place.

Mailchimp – Newsletter creation can’t get any more fun than with mailchimp. With endless video howtos, documents, and great support, plus templates for your newsletter that come in every shape and size, these guys have really thought of everything. What’s more the graphs and campaign reports will give you insight into what topics are popular, and what resonates with your audience.

Google Docs and Calendars allow you to share your schedule and work with a small team. So whether it’s communicating things with your clients, or your subcontractors, these tools are essential.

Dropbox – Another indispensable tool for collaboration, share documents easily across the web.

Don’t Be a Commodity

If your prospect is asking you for a resume, and comparing you to some outsourced resources provide, you’re not going to get very far as a consultant. Don’t be a generic resource that sits at the keyboard and churns out code.

What’s the alternative? Learn about business, talk to business stakeholders, listen to their concerns, and learn to speak their language. Use stories, and analogies. Reach across the table to speak in terms that everyone can understand. Your value is in symplifying complex technology.

Be Hungry & Don’t Give Up!

Being hungry means continuing to improve on your weaknesses, experimenting with different rates until you match the market demand, managing multiple projects and always networking widely. Spend less than you make and build up six to twelve months cushion. This will allow you much more freedom to take only the projects you want. Learn to pick and choose.

Further Reading…

There are lots of other areas you’ll lean about, running a successful consulting business. Here are a few:

  • managing cash flow
  • paying quarterly & yearly corp taxes
  • paying subcontractors
  • managing & accounting for expenses