The Exponential Power of Great Versus Average Resources

If you equate an average resource's value to 1X a Full-time equivalent (FTE), many people believe a good resource is somewhere between 25-50% more effective and a great resource is perhaps as much as 2 times more effective. But if you look at various types of skills and job types where the work is intellectually-based, what you'll likely find is that a good resource is actually 3X or more effective than an average one and a great resource is 10X or more effective than an average resource. How can this be?

Basically, most people think resource quality in intellectually-driven work is roughly the same as it is in assembly line work: incremental. However, in reality, its actually exponential. And when you think about what your organization pays for human capital, you can see how valuable this multiplier can be. On the flip side, when you're looking at resources with poorer capability, the reality is they can often actually be 0X - even if you have 1,000 inexpensive and not very good resources for example, they could work forever and never achieve or deliver anything. If you point the wrong resources at complex problems in an attempt to save a few dollars, you may actually get nothing - zero value - for your investment.

Really the question you have to ask yourself is: Are proposed resources at a lower rate because the type of work requires less skill and intellectual horsepower or are you getting lower rates because the resources are lower quality? Is quality the lever you're trading in order to save? Lower skill level and lower quality are very, very different rate levers in terms of purchasing professional services.

This concept manifests itself in different ways - sometimes its a purely quantitative metric where you're simply getting greater ouput from better resources (such as lines of code). Other times however it translates into exponentially better advice. I have seen organizations spend MILLIONS developing content or executing activities before a great resource came along and said 'you actually don't need to be doing any of this - all of this effort can be eliminated or easily replaced by doing X instead.' One organization for example had multiple individuals manually running search commands for years all day long to find and code certain documents before a better resource came along and said 'I will write a script in an hour using the same business rules these people are using and eliminate their effort permanently.' Imagine deploying those same individuals or that budget to more productive activities - enormous value - millions liberated in minutes.

The bottom line: If you're looking for intellectual horsepower, saving a few bucks is frequently the difference between going in circles and realizing signficant value.