Wednesday, June 18, 2008
The first time I spoke it was about increasing my own knowledge of the product. If you can teach it, you’re a master of it so the saying goes. Teaching has forced me to stay sharper and more on top of my game (less complacent) than I would otherwise be.
Andy surmises that some people speak to do de-facto networking. I will vouch for this – I have had many great discussions with people who’ve attended my sessions asking about future projects or my thoughts on a topic. He also talks about the couple guys who just love contributing to the community – and there are a few of them out there, with the key word being few. Some people just love giving something to others and speaking about technology is a form of community service, if you will.
I can say from personal experience the sheer amount of events in the state of FL is starting to become overwhelming. The code camp circuit has recently expanded to add Southwest Florida (now totaling 6), with 4 SQL Saturday events per year. Add to the local user groups who need speakers, and by the end of the year I will have spoken in Tampa twice, Jacksonville twice, Tallahassee twice, Orlando three times, Miami, and Naples. That’s a lot of money spent on travel but IMO it’s worth every penny. My primary concern about the high number of events is speaker fatigue – most of us are either working schleps in one way or another and have to give up what little free time we have to give back to the community. It’s worth it for now – but if there are another layer of events added I will have to pick and choose which ones provide the best forums for both myself and my audience.
Tuesday, June 17, 2008
My earlier synopsis was that most people would be better off working as 1099 contractors. There are numerous reasons, but the first is to make transparent the cost of benefits. The true cost of seeing the doctor when you sneeze twice in the morning is much higher than your $20 co-pay. Cash consumers also have a lot of leverage because they eliminate the middleman insurance company. Vacation time is very hard to value – some people don’t use it all and worse yet, some companies don’t allow their employees to use accumulated vacation time. For those economists out there, there is a labor/leisure scenario that goes like this: “As a 1099 I make $800 a day when I’m in the office, and if I want to take a day off work to go fishing I need to get at least $800 value out of my fishing, else I should work”. It’s pretty easy to put a valuation on leisure activities when you know your wage, but as a W2 employee it’s more like: “I get 2-weeks off a year so I’m going to be fishing at least 2 weeks this year and hopefully 10 more days when I’m supposed to home sick in bed.” It’s pretty clear to see that scenario 1 is more efficient for both parties as to the valuation of time and money.
There are also some rules that companies must abide by with 1099 workers that are not true for W2. For starters, 1099 workers set their own schedule. They are also given project milestones but not direction. They are sometimes provided with office equipment. W2 employees are told when they can/can’t work, are given training, direction, and specific instructions, and are provided everything they need to complete the job. The reason for these rules is that 1099 workers do not collect workers compensation insurance. One of my friends had a 1099 worker who didn’t pay his personal taxes and came back and claimed he should have been a W2 employee. My buddy was not impressed and it’s sad that some people reap the benefits and expect others to pay the piper. As a 1099, I prefer to use my own laptop during client visits because I have all the software I need to document and develop and I always have unfettered email and internet access via my Sprint card. At some client sites it’s difficult to carry on a phone conversation because of privacy issues and email is a confidential and quick substitute.
I also know people who have done the contract-to-hire routine. This routine is generally touted as a way for both the employer and employee to get to know each other before committing to a long term (W2) relationship. Unfortunately, I think it’s more biased to the employer. The employer can decide whether or not to extend an offer just as the worker can choose whether or not to accept it. But the worker is given a hard deadline of a time to convert or leave, and this is generally at the whim of the budget of the hiring manager. I’ve known friends who wanted to roll W2 but were waiting 8 months to start the project they were K-to-permed for, and didn’t feel comfortable rolling until the project started. That situation turned out to be a lose/lose for both parties because the company didn’t get a good worker and the worker lost a good long term relationship because the contracted ‘dating’ period wasn’t long enough to provide any benefits.
This post is becoming long enough for a part 3, so I will post more about this in a couple weeks when I get some time. Next I’ll explore the difficulty of finding 1099 work vs. W2 work, and where that trend is heading in the future. Stay tuned and happy data warehousing.
Thursday, June 12, 2008
Thought I would share an interesting dilemma I found myself dealing with the past couple of weeks. This is the consultant dilemma of whether to stay on as a consultant (or 1099 employee for commonality) vs. going directly and working with someone as a W2 employee.
First, there are numerous benefits to being a W2 employee. The true benefits are the ability to receive workman’s compensation in event of unemployment or injury, and the protection of having to deal with corporate HR departments if there is a personnel issue. Other ancillary benefits are generally medical insurance, vacation and sick time, and a retirement plan. The drawbacks of being a W2 employee are that it’s more difficult to move on to other projects quickly and generally some amount of pay is given up to provide the above benefits.
There are also benefits to being a 1099 employee. The major benefit is freedom. This freedom is being able to pack up and leave at a moments’ notice – which truthfully isn’t used that much if one wants to maintain satisfied clients. There are also other benefits like being able to manage your own career vs. following a corporate career path and receive much more flexibility with scheduling. The drawbacks are that you are responsible for providing all benefits and there is no nanny organization wanting to take care of you – i.e. companies do not have a vested interest in the well being of consultants as they do their own employees.
All that said, I’ve been studying and practicing economics long enough to know that there is a certain opportunity cost associated with being an employee. I did a little research into the origin of medical insurance being provided by corporations and it generally was a benefit provided after WW2 to attract the best employees in a brutally competitive market. Another offshoot was the good ‘ol pension plan which has almost universally disappeared from corporate offerings. Vacation and sick time provisions were also introduced around this time and now we have a model for the current workplace.
Is this model broken? I’m inclined to believe yes. Here’s the economic argument for it: Job seekers blindly look at salary and benefits to determine their offered compensation package. One thing is that it is very difficult to rank different packages side by side: if company A is offering a salary of $90,000 + $200 a month for health insurance + 2 weeks vacation + 2 weeks sick time per year, is that better than company B which is offering $93,000 +_ $300 a month for health insurance + 3 weeks vacation + 2 weeks sick time per year. Out of the door B looks better because of the salary difference ($3000-$1200 health care diff = $1800). However, what if company A would roll over vacation and pay out upon departure but B does not? Now the equation is different. Job seekers also don’t know that company A gives 4% raises per year while B gives 2%.
Everyone who has insurance knows full well that the costs have risen substantially in the past 10 years. A good portion of those costs can be attributed to the prevalence of insurance that subsidizes unnecessary procedures. An invention to fix this, the HSA account and high-deductible plan is designed to put more consumers in charge of their own insurance on the assumption that someone paying cash will do only necessary, value-oriented procedures. This has been proven time and time again that in a cash society the consumer is a winner.
Being a 1099 worker is not for the faint of heart – it’s easy to see steady, well paying work cancelled at the drop of a hat. A couple years ago I worked with a number of contractors who were brought in for a project, moved from out of state, and cut after 2 days on site due to cancellation of the project. The benefit is generally contractors are paid an hourly wage that includes the premiums of acceptance of this kind of risk and the loss of benefits. Someone who is smart can take good advantage of this situation to provide themselves with a higher level of salary and benefits at a much lower cost than what could be provided by a corporation.
Notwithstanding the obvious corporate goal of promoting employee stability and retention, I believe most people would be better off as 1099 employees. This would allow the following:
1. People are judged by their output and not padding the clock by showing up on Sunday to clean desk for 4 hours
2. You don’t get paid to socialize around the water cooler discussing last-night’s episode of Survivor (Reduction in office politics)
3. You are able to best manage your finances and benefits which in turns reduces the cost of providing insurance to all
4. Employers are best able to keep around high performers and lose those employees who do not perform
One major hurdle to this is recent changes from the government that more narrowly defines the W2/1099 world to keep employers from having contractors that are de-facto employees.
Obviously this is going to be a controversial post, but stay tuned for part 2……
Saturday, June 07, 2008
For the past 2.5 years I’ve been traveling around the southeast US giving lectures on Data warehousing and ETL. The first presentation I did was “It’s all about the Data: Building a Data Warehousing using SQL Server 2005”. Since then I have done numerous variations of that presentation. In addition I have done various deep dives into ETL design, architecture, and development for local organizations. Thus, I have decided to organize my presentations into two distinct areas: It’s all about the Data and Data in a Nutshell.
The “It’s all about the Data” series will focus on general overviews of data warehousing and ETL. These sessions are less technical in nature and a lot of overview of the subject matter and some demonstration of data warehousing processes. In contrast, the “Data in a Nutshell” (or DINS) series will be technical deep dives will a lot less overview and more hands on action designing and building data structures. Some DINS talks will include DBA tasks such as permissions, replication, table design while others will strictly complement the “It’s all about the Data” series by doing technical deep dives into ETL architecture and design.
It will take a couple events to get everything lined out but I’m sure when it’s done there will be a clear delineation of the subject matter and I hope to build these two talks into must-see sessions at events around the country.
Thanks again for your support and I welcome any comments.
In a previous post I had written about my displeasure of working with Windows Vista on my old Dell laptop. After installing service pack 1 the computer has sped up noticeably. The batteries are so old that they don’t last more than 20 minutes per charge so SP1 didn’t make a difference there, but the boot up speed and hard drive access issues have noticeably improved. At this time I have shelved plans to go back down to Windows XP Pro. I’m also working with a Virtual PC image of Windows Server 2008 and I’ve been quite impressed with the performance and reliability, more to come on that.
I’ll be speaking at the Orlando Tweener event at the Orange County Convention Center in Orlando, FL. This event is making use of the TechEd facilities during the weekend to provide free education to the 1300 registered attendees.
My session is “Data in a Nutshell: Using SSIS to Solve Common Business Problems”. This session is the first in my Data in a Nutshell series (see other posting for an explanation) and will cover the SSIS tool package and use it to solve common scenarios that may be found throughout businesses.
I hope you join me!