Fun with procurement

Last week the ZMan changed tack a little and wrote about procurement in large organisations. It’s worth a read, not least because the comments did not immediately fill up with morons explaining every bad thing which occurred since the Thirty Years War is the fault of (((the Rothschilds))).

For those unfamiliar with the RFP, which is sometimes called a request for quote or even a request for information, it is a document companies produce when they wish to buy a capital product or service. In theory, the document describes the item or service, the conditions that have to be met in order to be considered and the process by which the company intends to evaluate potential vendors. These are popular in government and large corporate environments.

This struck a nerve:

If an organization or government is buying a well defined product or a commodity item, it makes sense, but for something like a complex service, then it is a recipe for failure. Even in the case of well-defined item like a machine tool, I’ve seen RFP’s that appear to be written by enemies of the issuing company. The people creating the document use it to impress their boss, rather than make a sound purchase.

The other thing that always turns up in RFP’s is the underlying assumption that the person who wrote the thing is a genius. The specifications will be hilariously narrow, which results in the request being for an exact copy of what they have now, but newer. My suspicion has been that there is a correlation between the level of specificity and the lack of understanding of the problem to be solved by the purchase. Smart companies buy products and services to solve problems. Stupid companies tick boxes on forms.

When I was in Nigeria, the acquisition form an engineer would complete in order to buy something had space for no less than nine approving signatures. Whole weeks would pass as these documents moved at the pace of a snail from one desk to another. Occasionally we’d get a question or two but they were never sensible, more along the lines of “Do we really need this?” or “Can we use two 100lb flanges instead of one 200lb?” The people reviewing the acquisition and (eventually) applying their signature added no value whatsoever; they were certainly not to be held responsible for any errors therein. But their involvement was important nonetheless, just not in the way you’d hope: it justified their existence in the organisation.

A similar thing happens with RFPs (and many other documents produce in large organisations). Thirty-three departments will all insist on being involved, requiring an endless series of meetings where each person sticks his oar in. You’ll notice this when you design by committee: every department needs to be seen to contribute something, even if it’s completely stupid or irrelevant. If they don’t, they worry they’ll not be seen as important. The result is a jumbled mess of narrow interests, pet projects, hypotheticals, and competing priorities written up by a junior employee for whom English is very much a second language. I was once involved with an integrity inspection and risk assessment project in the Middle East and tacked on the end of the RFP was a single paragraph saying the contractor had to create an entire IT system which allowed each document to be uploaded, accessible to everyone, and modifiable with automatic revision upgrades. It was obviously the bright idea someone came up with at the end of a meeting; that risk and safety consultants probably aren’t the best people to be setting up IT systems didn’t occur to any of the geniuses in Contracts & Procurement. Another requirement you see is for the contractor to train client personnel in some area, giving no guidance as to how many people and to what level you must train them.

The RFP that spawned this post was obviously the result of some serious business problem the company needs to solve. The trouble is the RFP so thoroughly obscures it, no vendor will be able to identify the problem, so they will not be able to solve it.

The arrogance of a modern company is such that they believe vendors are both stupid and liars, and they don’t need to know what the actual problem is. All they need to do is read the RFP, submit the lowest price, and be prepared to do exactly as the client tells them.

This is a good anecdote, too:

A story I’m fond of telling is about going to the initial RFP meeting for a government contract. I was a young guy and still a little green. They handed out the RFP’s and discussed the schedule. An old guy sitting next to me thumbed through the document and found the poison pill in about ten minutes. He stood up, told everyone to look at the specific section. In a few minutes everyone left the room other than me and one other guy. He was the predetermined winner. It was a good lesson.

A lot of times when a company issues an RFP it’s simply for compliance reasons. Most companies have to get quotes from a minimum three (and sometimes five) bidders, even if they have an incumbent who’s CEO is good pals with the client’s MD and they have the job in the bag. One of the first things a contractor or vendor needs to do when they receive an RFP is work out whether they’re just making up numbers on a bid-list. If you’ve never done business with this outfit before and you get a call from someone in bad English expressing disappointment you’ve not submitted a tender and offering you more time, you know the job’s gone to someone else but they need to make it look kosher. I even ran an experiment on this once, and used to turn in bids at ever decreasing prices just to see what would happen. Then I stopped responding and I got a call from a chap in contracts who asked why I hadn’t submitted a bit.

“Because it’s obvious we’re just making up numbers on a bid-list while every job goes to that company you always use,” I said.

He was most indignant.


The Banality of Feminist Agitprop

Via a reader, an article on LinkedIn from “Award-winning CEO, Keynote Speaker, Author” Andrea Heuston, who runs a small graphic design company in Issaquah, WA.

7 Traits of Successful Female Leaders

I’m certain we’ve all met confident women throughout our lives. These women command a room and they leave you wanting to know more about them. They usually leave a good impression and they inspire positive action within their circles of influence.

But what makes these women special? What makes them stand out from the crowd? I’ve been researching these women for years. From Oprah Winfrey to Coco Chanel to Indira Gandhi and Melinda Gates, these women have strength and that certain indefinable ‘something’ that creates loyalty and makes you want to follow their lead.

So, what are those characteristics or traits that make those leaders stand out? Can we isolate them to emulate them? I think we can.

Here are the seven traits I have been able to identify that strong female leaders possess:

I’m not going to reproduce them here – readers can see for themselves if so inclined – but what she’s done is take leadership traits common to all leaders irrespective of sex and thrown in the word “female” at intervals. This resulted in nearly 70k likes and 1.5k swooning comments.

What this shows is not only that LinkedIn users are a bit dim, but how desperate people are to read anything positive about women in business that they’ll go giddy over something as banal as a list of 7 leadership traits dressed up in pro-women language. Now hats off to Andrea Heuston; she’s mining a rich seam if she can charge for this crap, and I’m half minded to do the same. But it’s indicative of the intellectual level at which these discussions on female empowerment take place, isn’t it?

(And I didn’t miss the irony of listing as a female icon Melinda Gates, who is influential solely because her husband made a hell of a lot of money.)


Shifting Sands

Via a reader, this is a good blog post which deals with several topics I write about on here, i.e. the degree to which large companies outsource expertise, the bureaucratic burden of compliance, people working in the gig economy, and the role of HR. Some quotes:

Today, Human Resources costs have gone up so much that small companies are outsourcing their HR tasks to service contractors.  If you’re a small company, perhaps around the 50-employee mark, the amount of time required to ensure compliance with the many laws interferes with the other things managers need to do.  As a result, they hire HR service companies to ensure they’re meeting all the regulations.

In the case of big engineering/manufacturing companies like the one I’m retired from, they will probably only keep the people who are their technology leaders as full time employees.  There will be fewer new graduate engineers hired: big companies were typically where new grads went for their first job because they’re too expensive for a small company to make productive. Perhaps those companies will soon be a few percent long-term employees, maybe twice that percentage in promising young engineers, but the majority of the “heavy lifting”; the jobs that require experience and the engineering judgement that experience brings, will go to contract engineers.

You may have heard this referred to as “the Gig Economy”; you don’t have a full time position anywhere, but you have a handful of part time jobs that you do as needed.

Go and read the whole thing.


Google’s self-inflicted wounds

A reader sends me this story:

A Google executive has left the company with no severance after he was accused of sexually harassing a young female job applicant by inviting her to Burning Man and asking her to take of her shirt for a massage.

Google parent Alphabet confirmed on Wednesday that Rich DeVaul had left the company as tensions heightened over how they handle such matters of sexual harassment allegations.

He was accused of telling a young female hardware engineer during her job interview that he and his wife were ‘polyamorous’.

DeVaul invited the woman to visit the Burning Man festival with him the week after her interview. The woman said she took her mother along because she thought it was an opportunity to speak about the role.

She claims DeVaul asked her to take off her shirt for a back rub when they were at the festival. She refused initially but agreed to a neck rub after DeVaul kept insisting.

Polyamory? Burning Man? Strange, because he doesn’t look the ty…oh, wait:

Of the group of people who inspired my book, which loyal readers will know is in part about a polyamorous community for whom Burning Man was an annual pilgrimage, the men were overwhelmingly working in IT. During my research, the ever-reliable Daniel Ream pointed out that while not every bloke working in IT is a deviant, the sort of people who are into polyamory will gravitate towards IT. The degenerate in the photo above is a walking polyamorous Burning Man stereotype. While I don’t wish to engage in victim-blaming, I find myself asking what sort of woman would go to Burning Man with this guy having been propositioned in an interview, and bring her mother along?

The woman said she took her mother along because she thought it was an opportunity to speak about the role.

Do IT people usually involve their mothers when invited to speak about a professional role? And that her mother was willing to go to Burning Man at all, let alone in those circumstances, says rather a lot about the family.

And this brings me onto my wider point. Regular readers of my blog will hardly be surprised that an ultra-woke polyamorous man with green hair turns out to be a rampant sex-pest. If he hasn’t spent the past decade identifying as a male feminist, I’d be amazed. Yet these are the sort of people Google actively recruits and promotes, based on their adherence to the ever-evolving SJW scripture, while firing anyone who commits heresy. The world’s largest tech company has made a point of hiring people with severe mental issues who parrot the correct political mantra, and has absolutely no idea what to do about the inevitable result. Here, via Tim Almond, is the BBC:

Staff at Google offices around the world have staged an unprecedented series of walkouts in protest at the company’s treatment of women.

The employees are demanding several key changes in how sexual misconduct allegations are dealt with at the firm, including a call to end forced arbitration – a move which would make it possible for victims to sue.

Google chief executive Sundar Pichai has told staff he supports their right to take the action.

“I understand the anger and disappointment that many of you feel,” he said in an all-staff email. “I feel it as well, and I am fully committed to making progress on an issue that has persisted for far too long in our society… and, yes, here at Google, too.”

Like some medieval religious cult, the self-flagellating priests think the problem is they’ve not flagellated themselves enough. By hand-wringing, pandering to extremists, and recruiting the mentally unstable they’ve fostered an environment where major HR issues are inevitable. But because they’re so far up their own backsides, they can no longer identify the problem, let alone solve it. That’s why they have to pretend this problem of green-haired polyamorous managers taking interviewees and their mothers to Burning Man exists everywhere.

Staff involved in Thursday’s walkout left notes on their desks telling colleagues: “I’m not at my desk because I’m walking out with other Googlers and contractors to protest sexual harassment, misconduct, lack of transparency, and a workplace culture that’s not working for everyone.”

These are not the actions of functioning adults. And besides, the managers are drawn from the ranks of people who are exactly like those walking out. Even if Google fired every manager tomorrow, they’ll be replaced by dysfunctional millennials who will act in exactly the same way. These people were recruited as perfect fits for the corporate culture they are now protesting.

They have also made formal demands to Google’s management. They are:

A commitment to end pay and opportunity inequality

A commitment to end things which by any objective measure don’t exist. Things haven’t got off to a good start, have they?

A publicly disclosed sexual harassment transparency report

This will read like the product of an algorithm taking stock phrases from The Huffington Post while mixing in a few generic “corporate values” available from any good PR agency.

A clear, uniform, globally inclusive process for reporting sexual misconduct safely and anonymously

This almost certainly exists: the trouble is, Google recruits psychopaths and promotes them as managers, who are then given control over said process.

The elevation of the chief diversity officer to answer directly to the CEO, and make recommendations directly to the board of directors

So diversity will become separated from HR? How’s that going to work? And what’s diversity got to do with sexual harassment?

The appointment of an employee representative to the board

Didn’t these used to be called unions? It’s going to be interesting to see what a unionised workforce thinks of Silicon Valley’s hiring practices.

An end to forced arbitration in cases of harassment and discrimination for all current and future employees

With forced arbitration being:

Forced arbitration, a common contract clause for Silicon Valley workers, demands any disputes are dealt with internally rather than through other methods such as the courts.

I’d have thought this amounted to a denial of one’s statutory rights, but given it’s California I suppose anything is possible. What is amusing is we had the YouTube CEO Susan Wojcicki publicly denouncing James Damore for wrongthink and Google CFO Ruth Porat weeping over the election of Donald Trump, all the while presiding over employment contracts which would look familiar to a 19th century Kentuckian mine worker.

Rather than ratcheting up the self-flagellation to levels not seen outside extremist cults, Google needs to get a grip by firing the bulk of its senior management and replacing them with sensible people who put in place policies which make the firm more like a serious corporation than a playground, thus changing the culture to one in which sane adults flourish while the mentally ill and perpetually aggrieved don’t get through the main gate. Their complete drip of a CEO can start this process by resigning on the spot.


Stories of Workplace Bullying

Via Daniel Ream, an article sharing horror stories of workplace bullying. Here’s the first:

My manager/direct supervisor would constantly comment on my food choices (fruit has too much sugar), my body (my arms were too toned), and my clothing choices (the shoes I wore looked like nurses shoes). She’d constantly tell me I dressed like a granny, and ridicule me for anything and everything. She once told me I was “too big” for a work shirt and gave me one once she felt I had lost enough weight.

The second:

I was repeatedly laughed at and called the “B” word by some of my co-workers. When I brought it to the attention of two of my supervisors, they did nothing. They didn’t even acknowledge the email that I sent them. … Nothing was said to my co-workers who were sitting around gossiping and allowing the bullying.

The third:

I was placed with this woman on the night shift. The next time I saw her, she yelled across the hospital ‘howdy, F**KER.’ I assume she thought this was amusing because it sounds similar to my last name. It didn’t just stop there. For months and months, she only referred to me as f*cker.

The fourth:

I was bullied, belittled and verbally abused by my co-workers. I had a co-worker come up to me on numerous occasions and speak to me in an aggressive and bullying way about how she WANTS things done HER way. She said to me “you need to do it like I told you” then she proceeds to walk away and says “God damn how f***ing hard is it for her to do as she is told?”

The fifth:

When I was younger, I went to work in the traditionally male-dominated fire department as a paramedic. I was the only woman in one department, and in another was one of 16 women in a 550 person department. I had men who were kind and helpful; however, I also had men who did their best to make my life difficult. … The worst part of the experience were some of the wives of my co-workers. An example: When I answered the station phone (remember no cell phones back then), one wife called me the station whore.

The sixth:

I worked in a place with an old boys club mentality for years, and I was a director who set policies for my department. Instead of having my back, the CEO, who was my boss, yelled at me in front of another employee saying “why can’t you just be nicer?” because that employee had gone to him complaining that they didn’t like the policy I had put in place. I also had a peer who, when I was pregnant, would go around and pretend to snap rubber gloves at his wrist and tell me he was ready to deliver the baby.

The seventh:

Working in Silicon Valley, I didn’t expect that being gay would raise an issue with anyone. After three years with the company (and being out), I brought my other half to the company holiday party. On the following Monday, peers from another department stood outside my office and cracked some really disgusting gay and AIDS jokes, yukking it up all the while.

The eighth:

At the time I was in a biracial relationship. I had talked about my partner and how great they were and everyone was happy for me, until they saw his picture. That’s when the “jokes” started.

The ninth:

I had a co-worker who was promoted to a supervisory position. She then spent the next six months chasing off anyone who had more knowledge and experience than she did. The way she did that was by accusing employees of things that they didn’t do, putting notes into the personnel files, calling them names, and humiliating as many people as she could. On my last day, she had an employee in her office behind a closed door, and everyone could hear her screaming at the top of her lungs.

The tenth:

I had been working at my company for almost 5 years when my boss was replaced by a woman who was at least 20 years younger than both of us. She would humiliate/berate me in front of staff, text me 24/7 and keep texting if I didn’t respond immediately, pound her fists on the desk, blame me for everything, throw the “F” bomb around casually, and much more. She was a nightmare.

The eleventh:

My supervisor above me would harass myself and the team I worked with almost every day. She would call me out, treat me as if I were a child, test our intelligence, etc… We would work our butts off to be at the top and she would treat us as if we were employees who didn’t know what we were doing, acted as if we were lazy (we weren’t), and everything under the micromanager book. It was awful; I gained 40 lbs and my hair started falling out.

The fourteenth:

I had just been promoted to Deputy Editor after being with the magazine for 10 years. At the same time, my Editor-in-Chief retired and was replaced with a much younger woman who had less experience than me, but had more television and online experience. Once we started working together she began bullying me by taking away some perks that I had acquired over time, syncing my calendar to hers, taking over my meetings, belittling me in the meetings, asking me to do things that were clearly part of her job, and then changing the deadlines so I could never accurately finish on time with all my other duties.

Has anyone spotted the pattern yet?

Nos. 7 and 8 appear to concern homophobia and racism, and No. 6 old fashioned misogyny. Nos. 12, 13, and possibly 11 concern men. The rest are stories of women making other (presumably) women’s lives miserable. Even in No. 5 where she was the butt of firemen’s jokes, the worst abuse came from their wives. We don’t have a gender for those involved in No. 2, but given they were sitting around gossiping we can perhaps take a guess. Note also the difference in the nature of the bullying, how personal women make it.

The answer, of course, is to lecture men on the patriarchy and adopt policies aimed at putting more women in positions of power. That’ll sort it.



About once a week I get an email from some company, usually to do with energy, telling me about some development or other which might interest me (I seem to be on some list as an energy blogger). Normally I delete them but I’d just been given an assignment as part of my studies so decided I’d reply to one I got two weeks ago. First I rang the person who’d sent it to express my interest, left a message, and they emailed me back. Then I sent this email:

Many thanks for getting in touch. I am currently an MBA student Geneva, and I wonder if I may talk to one of your spokespeople about the change. In particular, I’d like to ask:

1) Why XXX was split off from YYY and sold?

2) What opportunities will arise from XXX being a stand-alone company? For example, will they have easier access to capital for new products or research projects?

3) What, if anything, will change in terms of management style of the company? For example, will regional offices be able to act more independently within a more streamlined approval process?

My time zone is GMT+2. I’m generally available weekdays between 9am and 4pm (my time), or after 10:30pm. Are any of your spokespeople based in Europe?

I never heard back from the person I’d spoken to. So why do you reckon that is? They actually read my blog and decided they’d better stay well clear? They don’t want to waste their time with students? Or my questions were stupid of awkward?

Amusingly, I also got this email the other day from someone who definitely doesn’t read my blog very closely:

My name is Sonya, and I’m the founder of Her Aspiration. I wanted to reach out to you after coming across this page of yours:

We recently put together a piece Donald Trump’s quotes about women… an annoying subject for all of us. We think with the elections coming up, the more people we educate about his attitude towards women, the better. 

Here it is:

Would you consider adding a link to it in the page of yours I mentioned above? It’d really make my day 🙂

Let me know what you think!

Well, I’ve posted it, although not in the place requested. Do you think I made her day? Answers in the comments, please.


Weakness Exposed

A couple of weeks ago I wrote about Kimberly-Clark and asked:

How long do you reckon it has left under its current management?

Let’s ask that question again in light of this story:

Kleenex is scrapping “Mansize” branding from its tissue boxes after 60 years on the shelves as consumers called it out for being sexist.

The company said the tissues would now be called “Extra Large”.

One customer questioned the firm after her four-year-old son asked if “girls, boys and mummies” can use them.

60 years of branding in the bin because of a single Twitter user who was supposedly parroting her four year old. It’s not looking good for them, is it?


How not to recruit

Commenter Bardon graciously provides us with a business case study to analyse. Here goes.

We recruited a bloke recently to work in Dubai, and we initially were considering him for Kuwait, but the offer and acceptance was done on the Dubai role by me from Brisbane.

So this company has operations in at least two Middle East countries, but has no regional manager. Instead, things are run from Brisbane which makes about as much sense as running South American operations from Moscow. When I worked in that region, one of the first things I learned was Arabs appreciate physical proximity, and expect the regional manager to be in their country. Before I went to Kuwait I was very briefly based in Abu Dhabi, and the first thing the Kuwaitis asked was “are you based in Kuwait?”. We quickly got the message we need to be based in Kuwait if we’re working with Kuwaitis. At the very least, the regional manager should be based in the region; anyone who tries running things from the UK or elsewhere won’t be taken seriously.

He was based in Canada and coincidentally was in Doha when he initially arrived from Canada to get a briefing from our management team there.

So there is a management team in the Middle East. But they’re not the ones doing the recruiting for roles in their region. This sounds like a confused mess.

I spoke to him and told him that he needed to go and get some work…

So this chap reports to you, who is based in Brisbane. Presumably the management team in Doha is there for show.

…and that we will support him from Doha for the moment and that we will start building a Dubai team on the back of contracts.

I can only assume you told him this now because it wasn’t made clear during the recruitment process. It sounds to me as though you recruited him for an operational role in Kuwait and, once he’d signed up, decided to put him in a business development role in Dubai.

He came back to me and said that he wanted some staff now

So he’s advising you of his resource requirements for this new role you’ve suddenly sprung on him.

I said that he will have to wait and use the existing resource,

Ah yes, a regional “support” resource which he has no control over, yet he will be accountable for meeting targets. How drearily familiar.

then he said we needed to negotiate, negotiate what I asked him, he said that it was a very senior role more so than the Kuwaiti one…

So he is confused about the role, and I can’t say I blame him. Obviously you spoke to him about the role in Kuwait (or how else would he know about it), then later changed your mind. A professional company would have supplied a job description for the Kuwait role and later replaced it with one for the Dubai role, with the differences between the two roles clearly identified. Obviously this didn’t happen, hence you’ve mobilised a person halfway around the world who is confused about the role. This is not good management.

…and he felt that his package should be much higher.

Maybe he’s right, maybe he’s not, but you have changed the role he signed up to (or at the very least, left him extremely confused about the role he’s supposed to be doing). If you change someone’s role they are by definition permitted to enter into a discussion as to whether more money is warranted.

I told him to see me after lunch, contacted the relevant director and confirmed that he was on the next plane back to Canada.

This is the response of an immature child, not a professional manager. You have messed this bloke around since Day 1, changing his role and his country of assignment, and when he approaches you, quite reasonably, to ask for increased terms upon finding out the truth your immediate reaction is to fire him. This decision was not made for the benefit of the shareholders but your fragile ego.

I then told him it was over and he backflipped to say that he would do the Kuwaiti role for the leer money

Okay, seems reasonable. He pushed for money, got turned down, so weighed up that, having come all this way, he might as well give it a go. He sounds rather mature.

, no way, you are out of here.

So your employee, who has done nothing other than ask for more money having been lied to about the role and stuck in the middle of a dysfunctional mess of an organisation, agrees to do the job he was hired to and you fired him. Wow, what a tough guy you are.

He lasted about three hours.

And for this you wasted countless manhours on the recruitment process, plus paid for his mobilisation costs and whatever salary you owe him. On top of that, there’s the delay of several months spent trying to find a replacement. Probably the kindest thing I can say at this point is I hope this tale is made up.


Visa Quotas

Underneath my recent post on the importance of managers earning the respect of their subordinates, several people suggested Rick should have been fired, or was at least a problem. Leaving aside whether or not this was the case, here’s why it would be difficult anyway.

If a company wants to employ foreigners in Russia, it must submit an application for a work visa quota early in the year before they need the work permits. From memory, the visa quota applications for 2008 were submitted to Moscow around February or March 2007. In the quota application a company had to list:

1. The job position.

2. The nationality of the person who would fill it.

You can imagine this presents a considerable headache for a company which has just won a major contract and needs to get a few dozen foreigners on the ground right away, followed by a few hundred later in the year increasing to a thousand next year. Half the problem is you don’t know what nationality will fill a lot of the key positions. You can reasonably assume your scaffolding crew will be Nepalese or Kazakh, or your cladding guys Indonesian, but who will be the project manager, construction manager, safety manager, etc? You don’t know, because you’ll not be recruiting until next year and you don’t know who will even apply for the job. So what companies do is they take a guess, and put 30 Brits, 10 Australians, 5 Canadians, 5 Dutch, etc. against a generic list of company and project positions. Then as you recruit, you just assign each successful candidate to one of those positions, regardless of his or her actual job (I think I was a geologist for a while in Nigeria, and something equally daft in Russia).

Until a company has its quota approved, nobody can apply for visas and the process is fraught with difficulties in every country I’ve worked in. It’s very common for people to be sat overseas with their mobilisation delayed due to “problems with the quota”. Visas are rarely rejected, it is the annual quota application that fouls things up. In the early days in Sakhalin, companies simply bypassed this by bringing everyone in on business visas, which are much easier to obtain and require no quota. Then the Russians got fed up with this and started imposing large fines on any company caught employing people on business visas rather than full work permits. By the time I arrived in 2006, company HR departments operated a gigantic bureaucracy, juggling multiple quota applications and visa applications in a never-ending cycle: as soon as one lot of visas had been renewed under one quota, the application for the next quota had to be prepared.

Even leaving aside the fact that finding experienced industrial insulation specialists with LNG experience in 2006-8 who were 1) available and 2) willing to go to Sakhalin was a nigh-on impossible task, the quota system meant replacing one expat with another was also very difficult. You would either have to replace the outgoing person with someone of the same nationality, or recruit someone of a nationality for whom you had a spare slot. Getting rid of a Canadian (say) and replacing them with a Brit simply wasn’t possible under the Russian quota system. Eventually, many companies turned to manpower agencies and let them take care of it all.


Manage the people you have

Underneath yesterday’s post, Bardon wrote the following:

I don’t like Ilya either and think that he should be shown the door. How long has that loser being getting away with it, is all I can say about the useless idiot.

So let me elaborate on the situation on Sakhalin Island in 2007, which will be fairly typical of most non-western countries. There is a thing called Local Content Legislation which makes it a legal requirement on the part of all foreign entities to hire a certain percentage of locals. If the locals are uneducated, unskilled, and untrained it doesn’t matter: it is the foreign company’s responsibility to provide the necessary training to allow them to do the job. If there are no locals around because the site is in the middle of nowhere, you must hire them elsewhere and bring them to site. In the early days, it was possible to employ a whole bunch of locals as drivers or in other lowly positions, but the authorities soon got wind of this and started looking at job categories and average salaries.

Even before 2007 companies in Sakhalin were under enormous legal pressure to hire more locals in more senior positions. At the height of the Sakhalin I and II construction projects (which were running simultaneously), there were tens of thousands of people working on them, both locals and foreigners. The population of Sakhalin is around 500,000 of which about a third live in Yuzhno-Sakhalinsk, the regional capital. To say there were serious labour shortages is an understatement, and thousands of Kazakhs, Turks, Kyrgyz, Uzbeks, Azeris, Brits, Americans, Australians, Nepalese, Dutch, Indonesians, Filipinos and another forty nationalities were brought in to man the projects. Russians were brought from the mainland by the thousand, particularly those from the Krasnodar region who had experience on the Caspian Pipeline Consortium. Kazakhs were also favoured because they spoke Russian and had experience from the Tenghiz and Karachaganak projects.

In short, any Russian under 50 on Sakhalin who was not mental, in jail, or a raving alcoholic was in high demand (so about half the male population, then). Added to that was the problem that foreign companies needed most of their Russians to speak English, which reduced the labour pool even further. This is why all the foreign companies on Sakhalin at that time were stuffed full of teachers: they were the first ones they identified who could speak English, and any technical skill or other competence came further down the list of requirements. Much further.

So while we had some very good Russians working for us, we also had some pretty average ones who you couldn’t do much about because the law didn’t allow a foreigner to do the job and there were no better Russians available. It is in such situations a manager is really tested. Any idiot can fire someone and hire another, but it takes skill to manage a team with a whole range of individuals and understand that these are the people you have to work with. A common mistake a lot of modern managers make is to believe replacing people is a bigger part of their job than effectively managing those they have. When a new manager of Plymouth Argyle football club takes over, he doesn’t sell the whole team and demand the club buys Ronaldo and Messi. Instead he looks at the team he has and tries to get the very best out of them, and he’ll only sell a player once they’ve been shown they can’t fit the team and a better replacement is available. Now I understand some managers have the luxury of being able to fire people and immediately replace them, but let’s not pretend this requires any great talen t.Another way of putting it is you manage the team you have, not the one you wished you had; I was stuck with Ilya and had to work with him. In the main he did a reasonable job, could be relied upon for the most part, and brought in more money than he cost us. Indeed, by the standards of Sakhalin Island in 2007 he was a pretty good employee.

The other thing every manager had to be wary of on Sakhalin was the labour law. The Russian labour code is notoriously strict, and getting rid of people for performance issues required several steps with the involvement of HR, each properly documented. Even then, local employees used to take foreign companies to the local labour courts, who would delight in ruling in favour of their own (this was in stark contrast to when a Russian would take a Russian company to court, and get laughed at). This meant you would only fire an employee as a last resort, when the damage they have wrought is so great you have no choice. Usually, the way of getting rid of a bad employee was to make their job a bit rubbish and, with the labour market being what it was, wait for them to get a better job with another company on more money. The exception was if they were drunk at work, in which case they would always resign rather than have the reason for dismissal entered in their labour book for future employees to see.

In summary, firing Ilya on Sakhalin Island in 2007 wasn’t really an option, even if it were a good idea. Instead I was required to manage him. Imagine.