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March 29, 2007
Ireland As the World's Largest Exporter of Software
Holy smokes. In my last post, I asked "Is Ireland a Talent Magnet?"
The answer is a resounding YES, according to this archived article that I found on the web. What really struck me - at least when this article was written - were the numbers showing Ireland as the world's largest software exporter! Ahead of the United States and India!
Read about it here.
Posted by Mike at 2:41 PM | Comments (0)
March 26, 2007
Is Ireland a Talent Magnet?
I recently came across an interesting passage cited by Richard Florida in his book, “Flight of the Creative Class.” I had the pleasure of meeting Richard after his speech at the POPTech conference last Fall in Camden Maine. In “Flight,” he says:
“The global talent pool and the high-end, high-margin creative industries that used to be the sole province of the U.S. and the critical source of its prosperity have begun to disperse around the globe. A host of countries – Ireland, Finland, Canada, Sweden, Australia, and New Zealand among them – are investing in higher education, producing creative people, and churning out cutting-edge products, from cellular phones to computer software to blockbuster movies. Many of them have learned from the United States success and are shoring up their efforts to attract foreign talent…”
Richard then goes on to describe a sector of society whom he calls the “creative class” – scientists, engineers, artists, and cultural creatives, saying that the competitive challenge before us in a global economy is no longer goods, services, or the flows of capital, but the competition for [these] people. He also has established a “Creative Index,” a measure of creative competitiveness of nations.
He says the U.S. places fourth, behind Sweden, Japan, and Finland. Fast on its heels is – Ireland.
Along with a PhD candidate from Carnegie Mellon, Richard used data from the International Labour Organization (ILO) and compared forty-five nations on measures of creativity and competitiveness, looking at the percentage of society made up of the creative class. The U.S. is not even in the top five. It is in... eleventh place.
Ahead are several countries that have workforces where the creative class is a larger percentage. It constitutes about 1/3rd of the workforce in – Ireland.
He also describes says that the 2004 Globalization Index developed by A.T. Kearney and published in Foreign Policy places the U.S. seventh… behind – you guessed it – Ireland. Also ahead are Singapore, Switzerland, the Netherlands, Finland, and Canada.
It’s a very limited data sample, but after my speech in Galway, Ireland, I was privileged to have a few of the attendees at my table during the luncheon. I asked the fellow across from me where he was from. He replied, “Croatia.” Another clearly bright and articulate person to my right replied, “Czech Republic.” I asked, "Did you ever consider coming to the U.S. instead of Ireland? They replied, 'Absolutely not.'"
Wow.
Posted by Mike at 1:16 PM | Comments (0)
March 22, 2007
Ireland Diary Part 1
Just returned from a whirlwind visit to Ireland, where I gave my talk entitled, "Is the World (Really) Flat? Measurement Insights from Around The World" to a group of about 90 people who participated in the Software Process Improvement Conference 2007 in Galway, Ireland.
Here's a photo from a delightful day in Galway City, before the talk:
There is so much to say about my visit to this marvelous land that I don't know where to begin, so bear with me and I'm just going to let it flow in a brief stream of consciousness. (Forgive me for it possibly being rather unedited.)
First, I was taken by the absolute beauty of the countryside and the incredible kindness and hospitality of its people. Even in March, the meadows were lush, and dotted with livestock and stone walls. Now I know why God made the color green. The Irish own it.
I traveled to Galway on the western coast of Ireland. It is a prosperous port with a beautiful bay on the and splendid countryside. I was fascinated to learn that in 1625 and 1690, it was nearly destroyed by Cromwell's and then William of Orange's attacks on Catholic Ireland. You can sense the richness of Galway's heritage in the buildings and architecture. Today, it's home to a national university with a historic town center and hi-tech industries, but I also noticed from the newspapers that much of the region's manufacturing is being outsourced. Even Galway's and Waterford's famous crystal apparently is sourced from Eastern Europe, although the designs are still etched in Ireland.
Flying into Shannon airport, one comes into the southern part of Galway county, the second largest in the country. A delightful man named Robert met us at the airport and drove north to our hotel at Galway Bay. The land is absolutely gorgeous. I had to get used to the right hand drive cars and narrow roads, and on more than one occasion I could tell that if I were driving with my reversed perspective, there would have been a high risk of a head on collision. Robert said that many American drivers often break off the left hand mirrors of rental cars because they can't get used to driving on the left side of the road.
The conference was at the Galway Bay hotel, which looks out on the water not far from Galway City, a short cab ride to a fantastic downtown area. It's a university town, so in addition to the tourists, there's a vibrant energy from students strolling the pedestrian walkways and shops. I got a sense of "old Ireland" from the architecture and the land, but you could tell that there was also a healthy industry in the area and there was a balance between the pastoral feel of the countryside and a modern economy.
Keep checking this site... I've got more to say and not enough time to say it right now...
Posted by Mike at 12:03 PM | Comments (0)
March 12, 2007
Speaking to Ireland's Software Industry
Tomorrow I head to Galway, Ireland, where I'm giving a speech entitled "Is the World (Really) Flat; Measurement Insights from Around the World," at a software conference sponsored by Enterprise Ireland and Intec Billing.
The conference sponsor asked me to give a talk that addresses - interestingly enough - the pressures that Irish software companies are feeling to outsource development to countries like India!
I find this fascinating since one of my recent client engagements involved a financial services company that was outsourcing parts of its software development to - Ireland. They wanted a productivity and quality assessment of several multi-shore projects where teams were split between the U.S. and Ireland, a place with an apparently thriving software industry.
And yet I'm struck by the common thread - that companies are finding it very challenging to manage these kinds of projects, irrespective of what country they live in. The common dilemma is the mandate from the financial executives who are dictating policy when it comes to product development strictly because of lower labor rates in the countries that they can outsource to.
So, the debate will come down to followers of Thomas Friedman on one side, who say the world is flat; that all kinds of economic activity can decentralize and migrate away from advanced countries because of the rapid technological advances in communication. And on the other side are emerging voices that say the world is spiky; that there is a powerful counterforce from the clustering of human creativity and talent - resulting in productivity and innovation gains that come from smart people being co-located in close proximity to one another. People voicing these counter-views are folks like the Nobel Prize winning economist Robert Lucas and Richard Florida, Professor of Public Policy at George Mason University and author of "The Rise of the Creative Class."
I hope to add some lively insights into the debate by voicing what the data is saying, when we examine projects divided across continents compared to those where teams were "clustered" around. It promises to be an interesting trip to Ireland. I'll be sure to share the experience here.
In the meantime, here's a photo of the Cliffs of Moher. I'm told that the view is stunning and not to be missed.
Posted by Mike at 9:29 PM | Comments (0)
March 3, 2007
Easy As Implementing a Package …
Last weekend I had a conversation with an uncle who recently retired from his accounting job at a large university. His family was financially secure, the children were grown (with his first grandchild on the way), and he was healthy after going through a medical scare years ago. It was time to call it quits, start to restore the antique motorcycle his wife had given him for Father’s Day last year, and get ready to bounce his new granddaughter on his lap.
But before it was official, his employer asked him to reconsider, for one more project: deployment of an enterprise (ERP) application across all the colleges of the university. “There was no way I was ever going to stick around for that,” he told me.
Most of us don’t have the luxury of tipping the hat and bidding adieu like my Uncle Larry did in the face of a life-changing project presented by the boss. And life-changing it will be for a lot of people. What started out as a US $100-million project has ballooned to $250 million. As a friend once said to me, “Now we’re talking about a SERIOUSLY BIG man-sized pile of money!”
It’s no wonder that my fellow Cutter colleague Steve Andriole said that not one of the CIOs and CTOs that he had spoken to in the last few months would install their enterprise applications again if they had a chance to do it over. In his recent Cutter Trends Advisor entitled, “Sourcing Today and Tomorrow” (15 February 2007), he said it took many of them years to get the software to work, with some costing hundreds of millions of dollars. A few had even been fired when they exceeded their budgets and schedules. Do you really wonder why some folks head for the hills when the boss says the words, “Oracle,” or “SAP” implementation?
I don’t think it has to be that way. One of my clients -- a large financial services company -- has a solid benchmarking initiative in place that shows how nearly 100 of its projects has performed in terms of cost, schedule, and quality across small to very large IT projects. Among the projects was a group comprised of package implementations, all plotted against industry trend lines. We color coded those projects on the graphs using a legend convention showing them as blue squares, with the rest of the projects plotted as green circles, to distinguish the ERP batch from the overall sample.
The good news: In almost all dimensions, the ERP projects behaved like the other “traditional” projects! The bad news: some had overruns and slippages just like the rest, and the piles of money for some of the overruns were pretty big. But not all behaved that way. Some were quite successful, showed high levels of productivity, and were right on target for the scope, meeting their deadlines, and finishing within budget.
What does that tell us? That ERP projects can either succeed or fail just like any large-scale IT project, and in my view, it is within our ability to influence their outcome. Enterprise application projects are not going to go away anytime soon in my view. Andriole thinks that CIOs will stop doing them, rent versus buy-and-install (going the ASP 2.0 route), and shift to software as a service (SaaS), but I think that will take a long time. Meanwhile, big organizations -- multibillion-dollar corporations -- still need to run their businesses. Their legacy systems will either take ongoing care and feeding, or CIOs will make the shift to companies like Oracle or SAP to keep the ship moving. Like it or not, companies will have to get better at managing this kind of work.
So here’s some more good news: I believe that it’s possible to better understand, manage, and predict how these projects behave, and not suffer from year+ delays, cost overruns, and poor reliability. Having worked with dozens of clients doing package implementation and deployment projects, including the major enterprise application vendors, here’s what we know about these kinds of projects:
■ Productivity on ERP projects is very similar to traditional IT (development) projects. Their schedules, effort/cost profiles, and defects position similarly against other software project trends.
■ Three distinct classes of complexity seem to drive their behavior: upgrades (lowest complexity), standard implementations (medium complexity), and global deployments (highest complexity).
■ It’s possible to “size” this work by estimating and counting elements like business processes (number of major/detailed processes) and the custom artifacts to implement them (i.e., reports/tables, interfaces, conversions, enhancements, and forms).
■ The effort proportions for things like the “business blueprint” phase relative to the “realization and preparation” phase are highly similar to the proportions seen for the “requirements/design” and “construction/test” phase on traditional software projects.
So here’s the tricky part: traditional projects have long suffered from cost overruns, schedule slippages, and cuts in scope, so tell me again why it’s good news that ERP projects behave similarly?
It means that companies that have improved their ability to measure and estimate their projects can apply the same skills to better forecasting enterprise projects. It also means that if you collect some historical data on non-enterprise projects, there stands a good chance that you can leverage these existing patterns to sanity check your deadlines, budgeted effort, and scope targets against this history. Even better, you can run one of the commercially available software project estimation models to more accurately forecast time, effort, and achievable scope on these deployments. That way, you can get realistic about what you can implement within a given deadline in the first place, and not have as high a risk at suffering from an embarrassing and potentially job-threatening overrun.
Posted by Mike at 6:12 PM | Comments (0)