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Technology Stocks : Information Architects (IARC): E-Commerce & EIP -- Ignore unavailable to you. Want to Upgrade?

To: JDN who wrote (4614)	2/25/1998 2:24:00 PM
From: Bert Zed	Read Replies (1) \| Respond to of 10786

There is a great deal of discussion about postponing the Euro but people in Europe and definitely people in the U.S. understand less about the Euro than they do about Y2K. What a lot of us here on the thread do not realise is that although a lot of us only have a shallow understanding of the Y2K problem, me included, we probably rank in the Worlds top quarter of a percent of the knowledge base about the problem. And obviously some of us are extremely well versed on the problem. As a good example of how the Euro problem will effect us we have been informed in the U.K. that I believe Mercedes Benz, from 01/01/99 will start paying their many tens of thousands of employees in Europe in Euros. So straight away every bank with an MB employee will have to be able to accept Euros. We then have the fan out or domino effect. Every cheque or standing order or direct debit that an MB employee makes out of their Euro bank account needs to be accepted by the receiving entity in Euros. It doesn't contemplate thinking about !! And of course BMW, Opel, Audi have all had to follow the lead of MB. Anyway enough of that although the staffing problem will impinge on the ability of Y2K companies to recruit. Not only will Alydaar have to keep on demonstrating quarter on quarter growth they will have to be able to physically do the work. I have been in the CFO position with a world leader in software where we were desperate not to take another order for our software because we did not physically have the consulting staff to start the project. Of course we put our price up and up and fortunately or unfortunately still had the order stuffed down our throats with the cash in advance. Nice for the sales teams commissions, a nightmare for the Consultancy Services Director. I think that Bob Gruder is doing the right thing by ramping up the headcount becuase even if in the very short term recruiting expenses go over budget, then a couple of quarters later at least Alydaar will have the physical bodies to do the work. It may be that even Alydaar can't ramp up quickly enough on the headcount and will be selling LOC capability that they cannot package/remediate/return to client quick enough. It may be that it is Gruder out desperately searching for companies with the headcount to buy so that he can maintain Alydaar's meteoric growth. And he will looking for the companies who have missed their quarters figures and whose share price has dropped making them cheap relatively. Or as I suggested maybe Alydaar will miss a quarter and one of the other big players, not just in Y2K or Euro, will come after Alydaar. I just think that prices to the customers are just going to rise and rise and rise and polarization is going to happen quickly. The usual shake out. But at least it will be exciting. So in conclusion if we hear that for the 4th quarter 97, Gruder had hired a few too many bodies I for one will not be too worried. Regarding LOC prices I do not profess to be an expert but in the early days apparently the clients would accept that they paid say a buck per LOC, but soon some of the wiser ones pointed out that not every line needed looking at let alone remediating and also there was arguments about whether statements/narrative attached to defective lines counted as anothe line etc. I will see if I can shed some definitive light on the pricing and particular problems with particular contracts already announced in another post. I do know that this LOC argument slowed down the BA deal definitely.