Jan, I'll answer your question based on my consulting background and the little bit I have learned about TPRO's type of business.
--"why would a company spend 7000 dollars for Topro's CD, when they could go directly to the manufacturer and have them do the fix."
First, many companies will try and many will succeed at least partially to perform their own remediation. How many will attempt it on their own? We'll find out as early as Feb. 98 what the indicators are. The Indicators so far has been that the CD has already generated close to $4 Million in revenues since it's introduction. (This is an estimate based on the Quarterly report stating $1.5 Million to date and 2Million more by end Dec 97). Quite a success since at that point they were still waiting to solicit the product to Wonderware's 30K client base.
Second, very few plants if any use parts from one manufacturer. And while some manufacturers are doing their best to indicate compliance problems with their chips, at this juncture it would be impossible for them to go back and test every chip in every single configuration they created. We are talking about an insanely great number of iterations on any particular design. Those pieces are then soldered on boards that contain chips from many different Manufacturers. The task for an in-house staff to do their work without some mechanism to automate or computerize the process is huge. That's why in-house engineers will insist on getting their hands on anything that will help them. The value of the CD is that the work has already been done once, the cost in man hours to duplicate TPRO's work is worth much more than $7K.
Third, TPRO has already tested and used this product in some form or another while working on their clients plants. Their methodology is proven to work. They are not some firm who of late sense an oppurtunity and come out of the woodwork. They are the professional's in the field. How many companies can say they are truly experienced in Y2K embedded systems remediation. Not many, the Year 2000 problem has not come up in the past. TPRO's CD is a quick start to any company. If you know how these big companies work, you'll agree that if their Y2K plan hasn't gone through 10 years of committee's it's not ready yet.
Forth, there has been a huge movement to outsource work that supports but is not a business' core competency. What does this mean? Companies do not want to employ engineers if the companies work is centered around something else such as bottling, manufacturing, Pharmaceuticals, etc. As they need them they contract out to another firm to assist them. This way they can focus on their business. True, many will still have a small support staff, but this staff can't handle additional projects. (But, this point addresses more than the reason to buy the CD).
Fifth, nobody in-house wants to do the job or the responsibility for it. Too much risk involved to put your job on the line for. Many consulting jobs that I get are for projects that others were scared to touch. An outsider is a great scapegoat since they usually are already gone and can't defend themselves when people need someone to kick. This reason is probably the least obvious, but the most prevalent.
Anyway this may be more than you wanted.
Take Care,
JZ |
