Paul, it's actually Don Hutchinson's report, I merely posted it on SI (It was a lot of work getting it to look like Don's original). Finding qualified Engineers is always a constraint in contract fullfillment and needs to be stated upfront. In the process of formulating a contract to the point signing, you need to determine the type of people that are required. With that done, their availability directly effects the cost of the labor. For example, if TPRO lands Contract A and it calls for 3 On-Site engineers full-time, let's say TPRO has one Engineer internally available who is qualified to lead this team. Where are the other two going to come from: New Hire and /or sub-contractor. From Don's report it is evident that there exists small competing firms in most regions that TPRO does business in. These competitor's are actually great bed partners for TPRO at this point; the competitor's become the sub-contractor's.
The above is normal practice in the Computer Consulting field. My "competitor" are regularly calling me to do sub-contract work. There are ethics involved here and the smart company will make sure they get all the legal paperwork signed before bringing on sub-contracted people. It is a perfect arrangement for this situation were you only need someone for the life of the contract. When there is so much work and few workers, a smart company can thrive if they demand a high hourly fee. TPRO's 160/hr should more than cover their costs and still give them a good margin even if they pay the Sub-contractor $100/hr (notice with sub-contractor's there are no employer taxes and it's 100 % expense).
Each worker will be doing compliance checks for each part in the factory at $200/page. The margin on any hardware/software that needs to be replaced. Any chip's not in the database will generate another $150/hr for TPRO's remote site to do compliance checking on. All these fees are simultaneous. Notice the following scenerio:
Contract AAA (Inventory and Assessment of one plant)
2 On-site Engineers
6 days work x 2 Engineers = 96 hours
Labor Cost = $160 x 96hrs = $15,360
Let's say they ony check 1 Component every 2 hours = $200 x 48 = $9,600
Let's say there are 5 components not in database and it takes 20 hours to figure them out = $150 x 20 = $ 3000
Plus $4000 for the CD license
Grand total fro just the firast two steps = $31,900
My esitimates are conservative, I am sure their are more than 40 component's in a factory and I bet it will take a long time to test no-database components for compliance. After all that is done, the work has only just begun, now they got to fix what they caught!
The potential is huge just for one Plant, and from Don's notes it looks like things are panning out better than we could have imagined! ROFL
JZ |
