[Wikimedia-l] Mid-Year Financial Statements

[Erik Moeller]

On Tue, Mar 12, 2013 at 11:12 PM, ENWP Pine <deyntestiss at hotmail.com> wrote:

> Hm, I guess a planning problem could be the root cause, but since Erik
> seems to be saying that WMF has found a number of good candidates
> outside of SF and yet the statement in the FAQ for the mid-year financials
> said that the competition in the SF region for engineers is the reason for WMF
> hiring being slower than planned

On the tech side, we've filled 11 position in the first half of 12-13,
and we'll have filled another 6 by end of March. I'm confident that
we'll have filled at least about 20 positions by the end of the fiscal
(some of those are replacements for people who've left rather than new
positions). We've also made 9 of 10 planned conversions of temporary
contractors.

While the competition for local talent does affect our velocity to
some extent, I actually don't think the problem is with hiring
velocity per se (we're hiring at a pretty reasonable rate), but rather
with being more data-driven in how we construct the estimates for the
plan, both in terms of # of requisitions, and in terms of calculating
the spend for the planned hires.

In the 12-13 Plan (and that was also largely the process before),
hiring managers were generally asked to fill in estimated start dates
for each hire. These estimates, with a little buffer to correct for a
known tendency to optimism, were then used as the basis for the
financial input into the plan.

That may sound reasonable, but it essentially turns the question of
hiring velocity into guesswork at the level of the individual hiring
manager. Moreover, it has had a weird incentivizing effect of
budgeting hires as early as possible, because that would give hiring
managers the runway to open a position early, and the buffer to fill
any backlogged requisitions in the second half of the fiscal year. If
you review the hiring plan on the last page of the 12-13 plan, you'll
notice that almost all start dates are in the first half of the
fiscal. That's risk mitigation -- but not a very good way to do it.

For 13-14, I've asked for finance and HR to work with us in applying
performance metrics based on our hiring velocity and attrition rate in
12-13 against the hiring plan for the purpose of estimating the actual
dollar spend. I've applied those same metrics to our total req # ask,
as well. Instead of attaching unrealistically precise timing to each
position, we'll develop a hiring plan that's focused on an a rough
overall prioritization of requisitions.

So there's definitely potential for a more accurate estimation while
moving away from false precision. That said, I always caution people
about the delusions of planning. An exercise like the "Narrowing
Focus" this year was both very necessary, but has also had a
significant impact on the organization as a whole and many planned
expenditures, for example. We need to retain the flexibility to make
conscious decisions that deviate from the plan, and the realism to
acknowledge uncertainty.

On the second point, while we have a record to look back on, obviously
we don't really know what our true hiring velocity and attrition rate
are going to be for 2013-14, and we can reasonably expect to be off by
a few positions. I would much rather acknowledge that explicitly in
the plan than pretend that this uncertainty doesn't exist.

For this reason, I've proposed to Sue an explicit stage-gating of a
set of hires. By that I mean that we would unlock a set of
requisitions (we're considering building out a new team that could be
easily gated) only if specific hiring objectives are met by a given
date, and we'd clearly flag the associated expenses as being
stage-gated in this fashion. I don't know if Sue or the Board will
accept that proposal, but it would give us the flexibility to make
certain hires if we perform well against the base-level plan.

Erik

-- 
Erik Möller
VP of Engineering and Product Development, Wikimedia Foundation

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