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To: paul e thomas who wrote (6650)	11/29/1997 10:55:00 AM
From: paul e thomas	Respond to of 31646

TPRO SALES BUILD UP Jenkins indicated in the conference call TPRO plans to add no more than 150 Engineers to their staff for y2k work. This I suspect is to ensure minimum layoffs post 2000.He further said it will take 6-9 months. This added staff could generate about 9mm$ in consulting revenueper quarter. I would also expect 8 factories from each pair of engineers could be handled or 12mm$ per quarter in total from the new field force.It is clear then that to reach the boxcar revenue numbers mentioned by many people that manpower must be directed from other resources. It also appears that revenue from CD sales will be the principle driver until mid 1998.I don't know how to forecast that build up with any information I have run across.

To: paul e thomas who wrote (6650)	11/29/1997 12:39:00 PM
From: Jack Zahran	Read Replies (1) \| Respond to of 31646

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