Tuesday, March 18, 2014

Daisy Chains and HR

One of the most interesting aspects of the recent Satoshi Nakamoto saga is how an experienced computer engineer near Silicon Valley has not been able to find gainful employment in the industry for a decade despite a massive shortfall in skills?

It's interesting to me because a friend of mine was recently made unemployed. They had twenty years of coding experience, proficient in many modern languages but had great difficulty in finding a job. Fortunately that's now been resolved through personal contacts. 

My friend's problems in finding employment were threefold.

1) Age
First, they were over 40 years of age and unfortunately our industry suffers from a 'culture of youth'. I can sort of understand that in non mathematical based industries where a pre-occupation with data doesn't exist but in computer engineering than given the idea that the youth are more innovative is based upon extremely flawed concepts then I'm surprised it exists.

Alas, in my experience the HR departments of companies (with obvious exceptions such as the amazing work being done by Google's People Analytics) are not often populated with mathematically questioning folk but instead rely on more 'softer' skills. If they were then we probably would not have dubious schemes like Myers Briggs (MBT) being used despite being disproved as practically worthless in the 1970s by Barnum responses (aka Forer effect) and being rejected by the US Army. However, this is not the case, these myths exist and age is an issue but not the biggest one.

2) Loyalty
The second issue is tending to stick in a job for a long time. I'll explain why in the next section.

3) Not having a job
Not having a job is usually the biggest problem in getting a job particularly in industries where recruitment consultants are rife. To explain why, lets take two candidates for a job :-

1) Candidate Sarah has 20 years of directly relevant experience, a tendency to stick with a company for a long period of time and has been unemployed for six months. They are happy to accept $70K per year.

2) Candidate Sue has 10 years of mostly relevant experience, a tendency to leave a job after a few years and is currently employed. They are after $120K per year.

Which candidate would you put forward as a recruitment consultant? Well, I'm sorry to say that Sue is the most financially attractive for multiple reasons of which salary is the least important. The real reason why Sue is the most attractive is if they take the job then they leave a new vacancy to be filled i.e. their current employment.

Many recruitment consultants I've known make their living from creating daisy chains i.e. they tout Sue to the employer whilst at the same time quietly preparing another candidate (e.g. Bob, preferably employed) for Sue's job and finding another candidate (e.g. Alice, preferably employed) for Bob's job. Think of it like a house chain but with people. 

Alice -> Bob -> Sue -> New Role.

Daisy chains create huge benefits. Firstly, there's the financial benefit if you take 10% on annual salary for everyone jumping role in the chain.

Second, it can help strengthen your relationship with the employer / client. Take for example Sue. The employer might not know Sue is looking but you do. You can prepare the 'perfect' candidate Bob and turn up at the right time when the employer discovers that Sue is leaving and before any job has been advertised. A quick, 'I know someone who is perfect for this' and you can probably get an interview done in a few days.

You then repeat the trick with the employer of Bob and all down the chain. Each time, with each employer (aka client) it helps strengthen your position as the goto person and you can help reinforce this - 'remember the time when Sue left, I found you Bob in less than a day' etc.

From talking to people in the industry, my understanding is that daisy chains are common practice. In some cases, these chains can be ten people long and ideal candidates are those which tend not be loyal for long periods of time i.e. repeating chains is also a fairly common practice.

If you have a chain such as 

Dave (junior) -> Alice (senior) -> Bob (team lead) -> Sue (manager) -> New Role (director)

and you shift everyone, pocketing 10% of annual salaries, you end up with 

Dave (senior) - Alice (team) - Bob (manager) - Sue (director)

All you have to do is wait a couple of years, assuming you've managed to populate your chain with people who don't tend to stick around and then you can repeat it by finding Sue an even more senior job.

Dave (senior) -> Alice (team) -> Bob (manager) -> Sue (director) -> New Role (VP)


Dave (team lead) - Alice (manager) - Bob (director) - Sue (VP)

Loadsa money ... daisy chaining and managing such chains is where the action is at. 

Until this is somehow resolved, then the golden rules of getting in a job in IT tend to be a) don't grow old b) don't stick with an employer for a long time and most importantly c) have a job in IT. In terms of progression, make sure you get yourself on a good daisy chain and so be friendly to your recruitment consultant however unpalatable that seems.