Take a second look at what appears to be someone's "good luck." You'll find not luck but preparation, planning, and success-producing thinking....
- David Joseph Schwartz
September 4, 2008
Law bans docking KiwiSaver members
Well, that's how it is presented anyway.
What it actually means is Kiwisaver members get higher remuneration that non-Kiwisaver members.
Person A and Person B both do the same job at Acme Trading Company, are equally skilled and produce equal quality. In theory, they should be paid the same.
Not so say Mr Mallard. Person B happens to be in Kiwisaver (their choice), but under the new law, the take home pay of both must be the same.
Huh?
Person A and Person B both get paid $50,000 a year.
Person B is obviouslly going to take home LESS than person A because they are putting it into Kiwisaver.
In addition to this, after the $1043 subsidy paid to the employer, any employer contribution is PART OF their total rumaeration, isn't it?
No says Mr Mallard. Employer's who do this are now breaking the law.
So the person on Kiwisaver actually has remuneration of $957 than the person who is not. (excluding the subsidies)
How is that fair? Person A is certainly going to be grumpy. Employment lawyer are probably rubbing their hands with glee as the number of personal grievancies from non-Kiwisaver employee is likely to sky rocket.
As with all of Kiwisaver, this is simply another poorly thought out component that is going to see blood spilt in employment court.
I don't normally put technology stuff on my blog; it feels too much like work. However, I recently read an article on computerworld's site called Protecting your software investment.
I have never read so much technology drivel in my life. It is obvious they were drunk when writing it, and they show a complete lack of understanding about the real issues facing businesses that undertake bespoke development projects.
Firstly, a disclaimer, have I, or my companies (Red Toad Solutions currently, and Synergy Software historically) always got it right? No. Unfortunately not. It is really hard to get the balance between delivery to the customer, profitability, reusability and more importantly ensure people do what is expected of them.
I have a mantra about projects:
Projects seldom fail because of technology, they fail because of people.
The article waffles on about escrow services, virtual machines, licensing of the codebase and various other things the typical SME owner/decision maker knows nothing about. What's more, the article fails to raise the key problem of developing bespoke solutions to the SME market. Budget.
It all comes down to that one word. I'll say it again. Budget.
When dealing with SMEs, bespoke development eventually comes down to price. Not whether you are the best in the business, or the most highly qualified to undertake the work, or have the best track record and testimonials or can show all this with white papers and case studies. It comes down to can you say you will do something for a price that is worth it to the customer.
[Note to self: this is gonna be a LONG entry in the blog - sigh]
I will share with you a little project that started over two years ago for my company. It was a relatively straight-forward CRM solution. The initial estimate for bespoke solution was close to $50,000 from memory or several thousand a month for an off the shelf solution using something like Microsoft Dynamics. The client was a start-up; they had limited funds and it was too much for them. I suggested open source with some customization, but no - their business was "unique" and they wanted bespoke.
The question put to me was "can I cut the costs down". Regretable I said "I will see what I can do".
So... out came the scalple. We cut out the following:
proper discovery stage and design stage - we relied on a very rough excel spreadsheet as out "specification"
various bits of functionality
documentation
full Systems and QA testing - relying on the client to do this
no project management
Well, two years later, we still have issues passed to the client waiting for retests, the client is unhappy with the system, and we now look rather less than professional. It cost them less than 50% of the original estimate; but they got what they paid for.
In hinde-sight I should never have allowed the project to get past the "could you cut some costs" stage.
Now, back to tweedle dee and tweedle dumb [Note to self: probably better remove that - might upset Chris and Mark]
None of what they say makes sense really. As I have "picked up the pieces" from several Glazier Systems, Agility Group and Intergen provided solutions over the years, the article re-enforces my believe it is very hard to get it right.
However, I do have some rules that protect both the client and the vendor in this process.
Always have a dicovery stage; if the client doesn't won't to pay for it they don't value your time or their own business. Next client please.
Use tried and true technology; let the corporates with shit-loads of cash blow it on new technology. The SME can not afford to be guinea pigs.
Documentation is your friend; make sure you document everything. It is the best "escrow" service you can have. It means there is no dispute about what is delivered, how it is delivered, and how it can be maintained. Despite many client's expecting it for free, it is as valuable as the code itself, and therefore should be a charged item.
Regular meetings; don't be shy! Meet regularly and often. Communication is essential to a successful project. And again, some client's seem to think meetings are "free". Wrong. They are part of the process, they take time and therefore are a chargeable item.
Don't discount; Discounting does no one any favours. The price is the price. If the client doesn't want to pay for it they don't value your time or their own business. Next client please.
Testing; testing is part and parcel to all bespoke development. Never avoid it, and never "remove it" to save costs.
Maintenance fee; Insist on it. 15% of the inital project should be considered a normal annual fee for ongoing fixes and maintenance. Client's may think this is unreasobable, but quietly suggest to them they go to Microsoft and ask for a free upgrade from Windows 95 to Vista. See what happens.
Now, as to who owns the source code, thats a subject for another blog. In fact I could probably write a book on it.
Something providers and potential client's need to remember is your are both "in business". The provider's responsibility is to build a professional system that meets the client's known needs. Emphasis is "known needs", providers generally don't have a crystal ball (note the importance of 1, 3 and 4 above). The client's responsibility is to impart as much knowledge as clearly and efficiently as possible to the provider. It is also the client's responsibility to value the provider's time.
Companies like Intergen are great at preaching about process and new technologies. There are so many companies out there, some of them award wining, that say they are very good at what they do. So far in fifteen years in ICT, most of them as a senior consultant, I have yet to find a company that gets it right all the time.
It all comes down to that one word again. Budget.
When the budget is tight, which it usually is for bespoke development for SMEs, usually the first three things to go are design, documentation and communication.
The provider needs to be firm about the necessity of these, and the client needs to value them. These are areas that are directly influenced by people.
Projects seldom fail because of technology, they fail because of people.
Anyway, enough! I need to pee and get myself a glass of wine!
New Zealand has one of the lowest production levels per staff member in the OECD.
After recent events, and a little research I believe I have identified the cause that can be summed up in one sentence.
There is no incentive for an employee to do their job or be honest.
Basically, it is up to the employer to hold their hand even for the most basic tasks. If there are policies relating to things like email, it must have absolutely no area of grey. If the performance of a staff member is unsatisfactory, it is the employer's responsibility to work with that staff member with additional training, counselling and so on.
Why? The person is there to do a job, if they can't do the job, or they are too lazy to do their job, why should they have the job? All this breeds is mediocrity, which has been anecdotally proven with New Zealand's low productivity ratings.
Take for instance a recent case where a woman received $9,000 for being unfairly dismissed over email policy. Three warnings about using email outside policy, and she still won the case! WHO OWNS THE DAMN COMPUTER AND SERVER!
I have begun to realize that here in New Zealand the employer is a second class citizen, and the employee has skewed rights that protect their incompetence, laziness and outright dishonesty to the detriment of the country's economy.
Employment law reminds me of the litigation heavy USA.
"Warning: The contents of this cup is hot, and may cause burns" - on a cup of hot coffee... stupidity...
To me, eight months is a long time. I know as you get older, is seems times goes faster and faster. However, I still feel eight months is a long time.
Just recently, a sales consultant for one of my companies resigned. They got the better end of the deal, as they used a lawyer where I tried to follow "procedure" and "good faith" as is required by New Zealand employment law.
But the bottom line is after eight months, they had no sales. Oh, there was one, but the promises made to the client were so far from what was communicated to me that they refuse to pay. Apparently the consultant knew there were issues for nearly two months and never communicated them back to me. But that's another story!
Am I unreasonable to think that an experienced sales consultant should have made some sales? There were all the excuses, they were not experienced marketing, it wasn't their job, and without marketing, they could not sell. Blah fuck en blah.
So, here I am, stuck with a company 8 months into it's life and no sales. In addition having to pay the incompetent fool all sorts of extra money or face employment court. The company is so close to falling over its truly scary.
The clown better hope I keep it together or they won't end up with anything... the only money in the company is money I have from friends and family, and hard work in my other business. Such a nice individual to steal from my family like that! Lazy and stupid sums them up nicely.
Oh, I have been warned this blog entry might be naughty. However, it is my personal opinion, and if they really want to try extracting further money from an already crippled company, bring it on, there are still a few bones for a soup, enough for the liquidators fees.
As the owner of 2 sometimes struggling businesses, I often "juggle" around my cashflow. In the old days (not that long ago - I am only 37) you could effectively juggle with your utilities for 2-3 months as long as you made some effort to pay. You lost your 10% "credit", but that was life.
But now we have this 21/7/7 approach by the energy companies. In reality it is actually 14/7/7 as the bill usually arrives a week after its "date" due to outsourcing to mail houses for printing.
The electricity, gas and phone companies are very quick to enter "default" processing mode, forgetting many people and businesses have no choice but to juggle. All they have done in the past 5 years of policy change is create more paper (all the demands) and result in stress and poor customer relations.
All power companies send a default notice 4-5 days before your next bill is due! WHY? People forget, when they get their next bill they usually go - bugger I forgot - and pay the full amount. There is NO need to send this letter until 7 days after the SECOND bill is due.
I could go on, but I would be here to the early hours if I broke down the entire utilities industry poor business practices.
It reminds me of a Tui's billboard. New Zealand is building a Knowledge Economy, Yeah Right!
Helen Clark the other day said:
"The key for [New Zealand] is where the company is based, and where the high-value design R&D work is done, where it's branded, where the export revenue comes."
Yes, here we are looking at a pathetic $15 per $100 tax credit on Research and Development, one of the lowest in the OECD. Where the hoops to jump through to get government research funding compared to value of the funding is disproportionate, and basically, innovation is crippled by lack of support.
If a start up needs new investment, and changes it's shareholding "too much", it loses ALL of it's previous year's losses.
Obviously this is an excellent environment to push money into R & D. And don't even get me started on the state of infrastructure that would support extensive R & D... that little thing called broadband.
Another month and yet more paper filling up my office!
File this, file that. Sheez... if I was not so busy getting compliant (aha... I let it slip a little again) I would sort it out.
Obviously, DocScan, which is my other company, is well on the way to dealing with my paper war, but it has other priorities... like paying client's work.
Document scanning is pretty amazing, and when you consider the following, its such a surprise everyone isn't outsourcing!
* 90% of all corporate memory exists on paper.
* Of all documents that get handled each and every day in the average office, 90% are merely shuffled.
* The average document gets copied 19 times.
* Companies spend $20 in labour to file a document, $120 in labour to find a misfiled document, and $220 in labour to reproduce a lost document.
* 7.5% of all documents get lost, 3% of the remainder get misfiled.
* Professionals spend 5-15% of their time reading information, but up to 50% looking for it.
* There are over 4 trillion paper documents in the U.S. alone growing at a rate of 22% per year.
Hey, for 5 cents a page it really is work considering getting rid of the mountain of paper in the back room, the spare warehouse that could be better used and so on!
Think of it this way, 10 Eselite folders holds about 5000 pages. They cost about $250 to scan. How much does their storage cost your business?
I even considered getting all my personal stuff scanned. Your bills, bank statements, letters from people. Just stick it all on a DVD, all indexed, and be done with it.
Sigh, I sometimes have to step back and breath. The last 12 months have been a bit of a whirlwind.
The last week has been a bit stressful. I have fired a client, who basically questioned my skills and professionalism then promptly backtracked only to re-iterate their previous stinging volley of insults in their next email! Duh! Make up your minds! Oh - hang on - thats the problem, they can't!
To rub salt into the wounds, they then go and hire a flash developer, which after digging around, I tracked down. There are not that many Auckland based flashed developers called Rob! Why is it every IT person called Rob has either been a tosser or just plain stupid.
Here is his tirade on Flash being "the next big thing"
Lol - check his home page. The poor guy can't even spell development. Rob - spelling is actually important on your key profile site!
And he is absolutely wrong! Rich enabled HTML applications with AJAX will win over complicated and error prone Flash application any day.
I guess that is why the typical flash developer gets $40/hour and I get a lot more! (hah - fooled you! you really thought I was going to let my hourly rate out of the bag?)
Am I worth it? Hell yeah! Did this client think so - probably not.
Anyway - thats a little steam out from under the collar - and now onwards to complete yet another 18 hour day. Up at 5.30, in bed by midnight - sigh!
My new business (www.docscan.co.nz) is moving forward at a great rate of knots, but as all new business it needs investors to expand.
I forgot how hard it is to sell a dream, even when it is sniffing distance from reality!
You get questions like:
1. what if it all goes wrong
2. how will the money get spent
3. whats in it for me
And you get objections like:
1. oh - I can't afford that
2. nah - my job is fine, I don't need to invest (I always roll my eyes at this one!)
3. yeah right - way too risky
This is all well and good - but these are the people who complain when some pimply kid goes out and starts a business and makes millions, or they hear about a NZ Success story and go "god, I wish that was me!"
Well - I have a wake up call for these people - it is better to have tried and failed, than to have never tried at all. Do you think these successes went down the safe road? I think not!
I can almost guarantee all these people who have succeeded sat with the same fear and trepidation that the people I ask to consider investing in my business do. The difference is they got past their fear. Do I have that fear? Damn straight I do! Every single day.
I get asked all the time how can I go into a venture so apparently risky, face failure everyday and know I have a wife and child to feed and house.
My answer to this is simple.
Ask the workers at Feltex how they feel about "job security". Or the Air New Zealand staff sitting in limbo at the moment or the Telecom staff about to be made redundant before Christmas.
There is no such thing as job security, or a sure thing. The only person who dictates where you are in life is you. Every single person is self employed. The difference is some people go out at look for opportunity, where-as others sit back and think it will always be ok, and that they will have a job next week.
One is right, the other is wrong. And no matter which side of the fence you site, you know you are always right.
I really don't see it. People are spending like crazy, the housing market is "robust" and we have the lowest unemployment rate for 24 years!
How can we be in trouble? It's just mis-information and journalistic imagination.
I, as a business owner, choose not to listen. I will continue working as if the economy was in a good state of affairs.
Why?
Two reasons.
One, I just don't believe the negativity. It does not correlate with what I am seeing in the marketplace.
Two, because thats what successful people tell me to do. The companies that make good in so call recessions are the ones that are still positive, still give excellent services and still have the resources to make their deadlines.
So, don't listen to the doom-sayers. The economy is solid, and the markets robust. Do more of what you do well, and improve what you don't do so well. Make 2006 your best year, be in in business or in your personal life.
It was with a twinge of sadness that I read technology pioneer Russell Smith was killed in a small plane crash yesterday.
Although many people would not know his name, he is an icon of New Zealand businesses "can-do" approach, and he will be leaving shoes that will be very hard to fill.
To friends and family of Russell and wife Marian, my heart goes out to you for your loss.
