Getting the job done right in a tight DP market.

A potential client of mine pleaded. “Jeff, I know how it is. I was VP of Sales for …”

is now CEO of a high-tech startup. “At my old company, to get the A-team, you have to

spend at least $30 Million a year. $10 Mill [annually] gets you the B-team. $1-5 Mill,

the C-team. There is no D Team. Under a mill, they won’t even talk to you. My budget

He needed a complex, flexible, customized computer application built quickly and

correctly. His budget was limited. The stakes were very high

He was also scared. Many of the major consulting organizations are your best friend

while you have a large budget, and don’t know you when your money runs out (and the

project is half-finished or was not done properly the first time). Also, at the rates he was

used to charging people, he didn’t know if his budget would complete the project.

He did not want to hire a team of people whose salaries he would have to pay once the

job was done. He did need some extremely sharp people whose salaries would be an

unnecessary expense once the project had been completed. In short, he needed to find a

consulting group with extremely talented individuals who could a) solve his problem, b)

guarantee the solution, c) provide reasonable assurance that it would be done on time,

and d) pricing that would not be out of his range.

There seems to be a misconception that big is good. After all, this is America. But

economies of scale do not always apply.

There used to be an adage, “No manager ever got fired for buying IBM.” This adage was

probably started by IBM… their marketing was always brilliant and effective. But bigger

is not always better.

I’ve seen many DP projects that started along these lines: An accountant (frequently a

Big Six Partner) with the ear of the CEO will say something along the lines of, “You

know, if you created project X at a cost of $Y you would receive a fantastic Z% ROI as

soon as the project rolls out.” The CEO looks at the proposal and says words to the

effect of “Go for it.” So far, all statements true. Then the $$$ mentioned above kick in.

If the A-team comes in, the project frequently comes in over budget, barely on time, and

mostly correct. If the C team comes in, the project will typically be over budget, late,

and may have to be thrown out entirely (I’ve seen 8- and 9-figure projects thrown out –

it’s not always the C team).

There is no substitute for experience, talent, and common sense.

Big size/ more people / more money does not necessarily translate into a win for the

client.

Statistics provided by Computer Economics report that 70% of the organizations

surveyed were forced to delay IS projects they could not adequately staff. And, the

average IS shop used temporaries or contractors in numbers that were equivalent to 30%

of their full-time staff. The now famous Information Technology Association of

American (ITAA) study found nearly 200,000 vacant IT positions in the U.S. To

compound the problem, nearly 80% of large and midsize companies plan to add to their

IT workforces this year. A Computer World study finds that companies spent $4 in labor

for every dollar in software in 1997. This ratio was one to one just four years ago. It's not

unusual for large enterprise resource applications to incur ratios of ten to one.

Smaller companies typically deliver. It’s a very small world and they do not get work if

they don’t deliver.

The small consultancy tends to be entrepreneurial, and thinks out of the box. It tends to

be a group of people who have seen how things have been done, and want to do better.

They are frequently a group who of people have seen the rates their previous employers

charged for their services, and are undercutting those rates substantially. They are

dedicated to their craft, believing that high quality is more important than high profits.

It is a seller’s market, and the best of the best are frequently self employed, or are part of

a tight circle of professionals. They are often authors, public speakers, and the true

problem solvers of the discipline.

When choosing a consulting company, trust is very important.

Look for an individual within the organization who takes the time and seems to

understand your problem, can suggest an intelligent solution, and will remain part of the

team (not necessarily on a full-time basis) for the duration of the project. This is not a

time to bargain hunt. A fellow I know likes to say “Of on time, on budget, and right, you

can have 2 of the 3.” This is usually the case. But it is usually due to overconfidence in

capabilities and a belief that shortcuts may be taken. A project must be thoroughly

planned and allowances made for the unknown. Quality rarely comes at a bargain price.

Make sure you choose a “Consulting company” rather than a “Body shop”. A consulting

company typically likes to take on project work, and provide solutions. Typically, they

will try to sell you their group, and a solution. A body shop will try to place individuals

with you, & let you worry about the rest.

Don’t rule out very small groups, as small as one (mathematically, one is a group). If

you do choose an individual, make sure that individual can put together a team of other

competent individuals quickly.

Check references. As with any situation, most can provide references, and if they can