CCS
evolved from the company set up by ICL to construct accommodation
for the mainframe computer equipment they manufactured.
This service was offered to clients as a package deal.
Founder members then set up
a company in competition – again they offered
clients a package deal.
A management buy-out of that company resulted in the
founder members continuing the business, but showing
separately the cost of the professional design and
management from those of the various contractors employed.
The reason for this was the observation that clients
were calling for competitive quotations from package
dealers, based on whatever outline specification of
requirements that client could come up with –
usually pretty sparse.
Package dealers were left to compose their own designs
– with every incentive to reduce them to a minimum
– so as to make their tenders more competitive.
Extras became the order of the day once a contract
had been won. Some of the package dealers were actually
manufacturers of mechanical services equipment –
which then accounted for circa 33% of the cost of
a computer room. They did not hide their allegiance
and took advantage of the fact that their profits
were mainly in the mechanical services to discount
the remaining electrical and building elements. Their
expertise was in mechanical services, but they still
offered to manage the whole package – with the
conflicts that naturally occurred.
CCS realised that an appreciable
percentage of a package deal company’s overhead
was wasted in the preparation of such tenders. The
clients, by definition of the fact that they were
not providing complete specifications, were unable
to judge whose design was best for their needs –
and instead were looking for the lowest price –
and the conflict over extras that would surely follow!
We removed the speculative sales overhead –
our reputation by that time was sufficient to ensure
that new clients would continue to be attracted. Our
clients – who are also assured of the cost of
the project and who retain control over expenditure,
enjoy that saving.
We argue that this method adds the independent specification
of requirements activity to the project that is better
tailored to requirement and results in a lower overall
cost. |