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A SofTECH Interview
with John Sumser

The Project Oriented Society:.
Interview with John Sumser,
publisher "1996 Electronic Recruiting Index"

"Experts are predicting that by the year 2000, half of the American workforce more than sixty million people will be engaged in some kind of home-based work. These include corporate after-hours workers who take work home to finish at night or on weekends, people with home-based businesses, and telecommuters who operate out of their homes at least part-time during normal business hours. As home workers comprise a larger share of the work force, their profile is changing. In the 1980s, women dominated the field, but now most paid home workers are men, working in white collar businesses. Their average age is forty, and their average household income is $54,000." Investor's Business Daily, 3/5/96.

John Sumser is the founder of the Internet Business Network. He is also a world expert in the field of Electronic Recruiting, chronicling the shift from a "job based economy" to a "project based economy." After reading his book on Electronic Recruiting, I met him over coffee to discuss the changing nature of work, especially with regards to the Net and Electronic Recruiting.

John was interviewed by Eva Way Konigsberg, a SofTECH board member. (Click for photo of Eva).

Eva Way: John, what's your background?

John Sumser: I came out of the defense industry and edited the Whole Earth Review (about two years ago).

Eva Way: What's your basic orientation as a Web business consultant?

John Sumser: The standard Web business model assumes that a lot of traffic is a good thing. We start with the premise that there's only one hit we care about and everything else is excess. So what we're going for is a pure refined niche. We're not interested in browsers. We're interested in customers.

Eva Way: Help us understand how an entrepreneur can make the Web work as a business environment.

John Sumser: You build an audience and then you fish. You build the audience with your content on the Web. I like to use the Grateful Dead (the rock 'n roll band) as the metaphor to understanding the Web business model. In the process of coming to work at Whole Earth, I got introduced to the Dead. The Dead's business model is the Web business model. It's audience development. They created their own audience. They create in their audience the sense that there was something happening that was more than just showing up at a concert. They worked that angle of 'community' pretty extraordinarily. They were able to build a sustained audience. It really worked. The guys at the top are reasonably wealthy. The people in the middle are secure. And the audience had a sense of significance.

Eva Way: What has the Grateful Dead got to do with the Web?

John Sumser: The key to Web commerce is return visits. That's the business model. That's what the Dead did. That's why they're my metaphor for what a Web site should do. That's how a Web enterprise works. It doesn't make any sense to build your Web presence the way most businesses have been persuaded to promote themselves on the Web: that is, to set up a site with a zillion brochures. The key is developing a long term relationship not centered on the profile of the company, but rather on the needs of the customers. Once you have your 'community' or Website that fosters return visits, the next layer of complexity is creating adjacent communities. That's another thing Dead band members did. They were in concurrent other bands. They created an adjacent market in bluegrass, took some of their old market in with them and created a second market. In the Web, if you build it correctly each new enterprise creates a geometric set of possibilities if you align the markets so that they're adjacent.

Eva Way: Give me an example of how this works in the area of Electronic Recruiting.

John Sumser: In my business, Electronic Recruiting, we have a business that's made up of employment recruiters, job hunters, Web designers and marketers. That's four niches. With overlap between the niches. A recruiter needs job hunters and if he's going to recruit on the Web he's going to need a Web designer and Web marketing. Someone looking for a job on the Web is faced with a marketing task; the hunter needs all three pieces. There's a family of skills needed over the life cycle of a Web enterprise. You don't have the person who cuts down the forest also plant the fields. All the different players are needed. Web designers and marketers are the epitome of the project oriented economy. They have to move from project to project.

Eva Way: In your book you say there's a shift going on right now to where society is becoming more project oriented and less job oriented. Can you talk about this?

John Sumser: Yes, it is the natural result of downsizing. But you have to go back further than the downsizing and re-engineering of the last 20 years to understand the trend.

Eva Way: Where does the trend begin, then?

John Sumser: We look at the industrial revolution circa 1860-1870. The science of management came in with Frederick Taylor around this time. That organization style worked for 100 years and then started becoming unglued. This really went topsy turvy during World War II when women in America entered the factories and changed the face of work in the country that ended up assuming market place dominance.

Eva Way: Why would women taking factory jobs because the men were off fighting change the nature of work in America and ultimately around the world?

John Sumser: Hierarchical organization is gender related and generally uniform. What happened in the 2nd World War that nobody noticed is that the factories started to run without as much hierarchy. Women had experience in the work place and did it differently. That fomented for a generation or so. Then we saw the inception of the National Training Labs movement spawned out of the Kennedy administration. This was the first leadership development program staffed by women. Up to that point leadership development was an all male exercise. Rosabeth Moss Carter was part of this. Edie Seashore was another. NTL fostered sensitivity groups. This was a move towards nonhierarchical management that started a thread toward dissolving the ivory tower dichotomy. This led to the Quality Movement, re-engineering, downsizing and the shift to project economy.

Eva Way: So women's involvement in business led to nonhierarchies and this great sensitivity led to the downsizing of the last ten years? Give me some linear detail on that, please.

John Sumser: To run a large industrial organization you needed a lot of specialties. That's what characterized the industrial era. Over the course of the 100 years the specialties became highly segmented and specialized. Only accountants could do accounting. Only engineers could do engineering. Look at you on your laptop right now. You do engineering, you do accounting. You, Eva, you're reflective of the move away from specialization and toward diversified skills contained in the individual. This is the trend.

Eva Way: Is this the result of the technology?

John Sumser: No, technology is the enabler, not the cause. The movement is the move toward putting specialized tools in the hands of the worker. That enabled this to happen. Quality Circles taught Joe the worker how to assess, analyze, and checklist his work. He needs the basic skill. The skills have been aggressively pushed onto the equivalent of the shop floor: engineering, accounting, quality control, design improvement.

Eva Way: Where does downsizing fit in?

John Sumser: Downsizing is the result of that trend. It's what happens as the skills get dispersed within the workforce. We used to have an engineer on the staff that we needed 90 days out of the year. So in the new economy, downsizing said we can get that engineer for the 90 days as we need him. As a contractor. As a temp. This was the shift- getting skilled workers when they're needed, rather than housing skill holders on the payroll as employees, coupled with the automation and restructuring work flow. 10,000,000 jobs were cut in the US in the last ten years.

Eva Way: So downsizing led to the switch from the job based economy to the projectized economy?

John Sumser: Charles Handy, an Oxford economist, calls it the emergence of the "portfolio career."

Eva Way: Because once you know your company needs you only ninety days out of the year, you have to think about what you're going to do for the 270 days?

John Sumser: Exactly. Right now, thirty percent of the US economy is project based not job based. Sixty percent of the economy will be projectized by the year 2000. The project economy is America's move into information colonialism. Think of Henry Hudson, an explorer for the British tea company in the 1500s. His job was to go out and find cheap stuff, bring it back and market it. It was goods based. Today the frontiers are not physical, they're intellectual. So the question becomes how do you get X task accomplished at the highest quality at the lowest price. So then you get someone who understands how to take a project and farm this piece out to Korea, that one to Central Europe or wherever. We're moving rapidly to an integrated global economy, where the skills of project management are significantly more important than project execution.

Eva Way: Why?

John Sumser: There's no shortage of people who can execute. We have a shortage of people who can do the project management. It's a significantly misunderstood component of a practical solution.

Eva Way: Why is it significantly misunderstood?

John Sumser: Because the implementation details are so mundane.

Eva Way: So therefore people think anyone can do it?

John Sumser: A lot of people think they're good at it. Very few have actually done it. Project management isn't enterprise management. It's the envisioning, staffing, financing, scheduling, and execution of distinct pieces of work. But the Project Manager doesn't do any of the work. The Project Manager is an administrative function. Their job is to monitor, measure, gather feedback, correct the functioning. Manage the iterative process. In order to do this you have to have a very detailed, mundane plan. I learned the importance of project management in the military. My big projects were parallel processing development for virtual reality applications in large scale battlefield simulations. Project management is only well practiced in the military. The Project Manager's job is to spec resource requirements form a variety of functions generally outside his or her control. In a traditional enterprise model you grow an organization with X resources in it that you have to utilize maximally. Project management works best when none of the pieces report hierarchically to you. They report contractually to you. At NASA they call it systems integration. The Project Manager is accountable to someone somewhere for the whole ball of wax.

Eva Way: So project managers running projects with contractors brought in for specific roles is what the economy is increasingly moving towards?

John Sumser: Precisely. And, by the way, none of the software for the project management function is any good. Because project management is really about me persuading you, the day before you tell me that you're not going to make the deadline, that you can make the deadline and that your work around is not going to compromise the deliverable. In the real world, you have tracking software that goes to the left and the real project management goes off to the right. So you have meetings about what the tracking says. And then you have the real meetings to keep the project on target. Reality diverges from the map. The map making tools aren't fluid enough. The gist of project management is a perpetual tap dance because nothing ever happens the way you plan. A lot of people think that means you don't have to plan. But the more you plan, the more you're able to dance when the plan is veering. That adjustment is a constant feedback loop. The budget and schedule are always wrong and you always have to redo them. In the process of redoing them you understand the needs of the next work around. Because project management is the art of the work around.

Eva Way: How does this need for project management relate to Electronic Recruiting and the Web?

John Sumser: If sixty percent of all enterprise is projectized four years from now, then the question of how you move people from project to project in an economy of 125 million jobs becomes critical. Seventy million of those people are going to be juggling clients all different kinds of ways, some of them seasonally. It's not reasonable to presume that seventy million people juggling clients will do it well. It's more reasonable to presume that you need a mechanism of knowing who's available and where to put the work and some assessment of the quality of the job that's going to get done. That's what Electronic Recruiting will become. Thirty years ago, essentially, recruiting started out as Manpower. There were only temp agencies before that. Executive recruiting is a brand new thing. Almost all executive recruiters are under thirty. It's a new field. It started as temp agenies with some executive search. Even in the late 70s, Kelly and Manpower got people minimum wage . Today Kelly places contract software developers, not clerical. The whole business has moved upstream. With downsizing and outsourcing, the big recruiters are staffing whole projects.

Eva Way: Where does the Web come in?

John Sumser: The Web is the market place for work. After sex, the most heavily trafficked newsgroups are the ones related to jobs. One of the things that motivates people on line is the search for work. The growth in the recruiting industry reflects this.

Eva Way: Let's say I need to hire twenty-five people for five different projects. What do I need to do to use the Web for Electronic Recruiting?

John Sumser: You find a good Electronic Recruiter. The expertise available in Electronic Recruiting ranges from the kind of person you should hire but won't, [to the one] who ends up becoming a partner in your business. The Electronic Recruiter finds you that person. You pay them thirty percent of the first year's salary and forty percent of the contract rate. If you're the job seeker, you work with the professional who'll help you write your job description so that it'll draw the right matches. Check out the twenty-five top Electronic Recruiters.

(For a list of the 25 top Electronic Recruiters visit IBN's Website at www.interbiznet.com/ibn).

Eva Way: How would someone set up shop as an Electronic Recruiter in Prague, for example?

John Sumser: If you want to go into Electronic Recruiting in Prague, I'd start an on-line database that made no promises about jobs, that just solicited resumes. You can, if you're clever, accrue a database of resumes quickly. Put up a Website, offer some sort of value in exchange for the resume, "For putting your resume here, you get__." You have to set up some value exchange with some audience looking for work. Find out what the honest to goodness, no shit details of who's in the labor market. What resumes can you get your hands on? Who's looking? You have to see if people who are on-line in Prague are looking for work. This approach calls for a Web site development, promotion and marketing scheme that's investment intensive.

Eva Way: How is this process different than, say, if an HR department of a fast growing company here wanted to use Electronic Recruiting?

John Sumser: Actually, they have the exact same problem. They can do it themselves or completely outsource. My bias is always toward completely outsourcing the electronic recruitment process.

Eva Way: But assuming someone didn't outsource, how would they, in effect, set themselves up to do Electronic Recruiting in this new job based, projectized economy?

John Sumser: Build a Website, develop recurring content, probably not about jobs you have, but more in a subject area where people are interested. Provide content of interest to the market you're trying to attract. Then market it, so you get people to come. That's the kernel for success in all areas of Web business, including Electronic Recruiting. You don't harvest it for a couple of years.

Eva Way: Who's doing Electronic Recruiting on the Web right now?

John Sumser: Right now the bulk of all long haul truck driver recruiting is happening on the Web. How do you recruit truck drivers on the Web? You put up a Web site that has info on the best places on the interstate to eat; you put up a Website on how to get more mileage out of your tires. Brought to you by....the company looking for the recruits. You set up a guild center. People gravitate toward their own community of interest. IEEE has a Website with 15,000-20,000 jobs posted. There are 650,000 listings on the net today.

Eva Way: Can you provide any more insight into how electronic Recruiting efforts could work in Central Europe?

John Sumser: In Prague, I'd tie a job recruitment effort of a bunch of companies with an E-zine that could have a job focus section. People who are publishers have a lower cost of entry into Electronic Recruiting than recruiters do. CMP has the best recruiting Website of anyone. I've pissed off a lot of people by saying this. CMP has fifteen periodicals worth of information and audience. They have fifteen periodicals targeted at fifteen discrete publishing niches. They were smart enough to understand that describes fifteen points on the circumference of their market. Their real market is 150 subsets of that fifteen. If you're in their audience, you can mix and match bits and pieces. If you become a CMP regular, you get the opportunity to tailor your own magazine. If I'm interested in UNIX boxes, Telecos and whatever, I get a tailored publication around those subjects. This is beyond communities of interest. This is tailoring your product to an audience of one.

Eva Way: This is mass customization taken to the limit.

John Sumser: Envision that in your electronically delivered, custom tailored periodical, there is a job section. Tailored to you.

Eva Way: This is the way that people will move from project to project?

John Sumser: It's one way.

Eva Way: Who's going to dominate this Electronic Recruiting market?

John Sumser: You can buy this market for a billion dollars. It'll cost two by summer and five by Christmas. The company that's going to take it is most likely a player like AT& T or Pacific Bell. Think about the phone company. Their post tax, pure margin on Yellow Pages as a product line is $3 billion per year. Their profit is at risk.

Eva Way: Because the Web can potentially take it away?

John Sumser: It is taking it away. Check out www.bigbook.com. It's a Yellow Pages listing of every business in America, including a map to the storefront. So a company with a billion dollars where their ongoing revenue stream is at risk is going to be the one who is going to take the market. Not a little entrepreneurial start up. I'm going to remind you of the mindboggling statistic. There are already 650,000 jobs online. No one can find anything. You don't need another source of confusion. You need a big player to step in with a big directory type of presence.

Eva Way: What do you need to do Electronic Recruiting?

John Sumser: You need Electronic Recruiters. This is a new class of information entrepreneurs. You need the process of credentials collection, opportunities collection and matching.

Eva Way: How do you get credentials collection?

John Sumser: The answer hasn't changed. You build a Website, you build recurring content, you market it. You attract an audience, and then the audience gives you information back in exchange for what you've given them. That's how you collect credentials.

Eva Way: How do you collect opportunities?

John Sumser: The same way.

Eva Way: How do you match?

John Sumser: There are four or five companies, maybe ten, who are developing matching approaches, matching technologies with varying levels of sophistication.

Eva Way: Who?

John Sumser: Examples I like are JobCenter, ESpan, and Intellimatch. Internet Professionals Association (ipa.com) is on a different scale altogether. If this were a sci fi conversation, IPA uses Wetmatching and the others use Drymatching. IPA is a collection of 1600 online recruiters. So Wetmatching means there are 1600 minds doing the matching, not a machine process. JobCenter, ESpan and Intellimatch are all a combination of key word, skills and artificial intelligence. All machine based.

Eva Way Konigsberg evaway@proclivity.com

For more insight into Electronic Recruiting and the Projectized Economy visit John's Website at : http://www.interbiznet.com

Or order his book, "1991
Electronic Recruiting Index" from
Internet Business Network,
PO Box 2474,
Mill Valley,
CA 94941

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