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  • Am i losing business for doing a proper job?

    Posted on April 26th, 2007 Andy Parkes 4 comments

    I’m putting my neck on the block a little with this but wanted to ask the opinion of others

    We’ve recently quoted to do a new server installation

    We have both quoted for the same hardware and software (HP Proliant Server, SBS Premium) but we have been told we’re being beaten on the amount of days we’re quoting for configuration

    Basically the competition are quoting a day in their workshop for inital configuration of hardware and SBS and three men on site for one day to do the rest (so three man days, four in total)

    The work will basically involve configuring server hardware, putting in the new sbs (from scratch..not a migration),setting up user accounts, email (exchange), getting data from old server, ensuring permissions are correct, installing a hardware firewall solution, getting the pc’s (with user profiles intact) onto the new domain (25-30 users), configuring backups, monitoring & alerting, installing anti-virus software, install and configure UPS software/hardware, re-installation of printers onto new server, plus anything i have missed here and the other things you only find out about while on site.

    Now i’m not doubting that you could do all that in three man days (four if you count the workshop day)

    If i was doing this as a swing migration i’d be adjusting the times but this specific situation doesn’t lend itself well to that (long story in itself!)

    Would you be happy you had completed the work to a high enough standard or are we (as a company) taking long?

    We have quoted a day in the workshop to put the server hardware together and start the SBS install off and then two guys on site for five days (eleven man days total)

    As a side note when it comes to these installs we always let the customer know that we do err on the side of caution as there is always something you dont know about until you get to site (like they dont have their isp information, or the disks for some LOB application have gone walkabouts). The customer usually prefers to know upfront instead of getting nasty suprises at the end. So we only actually invoice for the time we’re there so it may not actually be eleven man days

    Also bear in mind we have been installing SBS since 4.5 so are no strangers to it.

    So either we’re taking too long or their not doing the job properly…honest opinions please?

    I do actually have my own opinion as to what the situation is here but i’d be keen to hear what everyone else thinks before i say anything else..

    Thanks

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    Andy Parkes is Technical Director at Coventry based IT support company IBIT Solutions. He is also Microsoft Partner Area Lead for 2012-2013 and coordinates AMITPRO which is a peer group for IT Professionals in the Midlands area. He also isn't a fan of describing himself in the third person.

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    4 Responses to “Am i losing business for doing a proper job?”

    1. So you’re quoting what… 88-hours for an SBS install for a client with 25-30 users? My initial reaction?… It seems high. Without getting too deep into the numbers you’re probably charging what – 7-9k for the service effort, vs. your competition of 2-4k?

      Without knowing your business – processes, existing client-base, desire to growth, etc. it’s hard to say. However, your question seems to imply that your competition isn’t doing a “proper” job. Is this really the case (do you know their previous work?)? Or is it that your competition has designed better processes and procedures to minimize their project effort? Think Toyota in 80s vs. US manufacturers who didn’t improve their processes – Toyota made MORE – better, faster, cheaper cars because they spent years improving their processes, lines, and tools, while their competition didn’t. Also, are you learning from your mistakes – do you do project-reviews with your team, and make changes to your processes and procedures after each job? Or maybe it’s that you’re promising (and delivering) the world to your clients – while your competition is making assumptions that lower their risk and effort? For instance – you’re moving their profiles over for them, correct? Perhaps your competition added an assumption such that “we assume all users can start with a new clean profile” (just as an example).

      Another thought, what’s your business-model, vs. your competition’s business-model? Is your competition trying to sell “razor-blades” (support-contracts for after the project), while you’re busy trying to sell “razors” (the initial project)? Personally, all I want to do is capture the recurring revenue stream from support-contracts – get the relationship… if I know I can sell one of these, then “break-even” on a project might be perfectly acceptable (though I’d be careful about how you define break-even – especially in the service business. Even on a project where I assume you’re discounting your hourly rate, you cost for labor is still substantially below your bill-rate) . Now, if I’m selling software projects where there is little if any recurring revenue, then I want to make money on my project. But it all goes back to your business-model in my opinion.

    2. Hi Nick

      Thanks for the comment. Exactly the sort of thing i was looking for..

      88 hours? don’t you guys take lunch in the States :-p

      7-9k? Your working in dollars right?!

      The “proper job” thing came about from the frustration of visiting sites over the last couple of weeks of potential new customers. The state some of these systems are in is untrue so after getting details about this particular quote it felt like it was another one of those on the horizon. They come in at a lower price, do just enough to get the money and then provide poor service and the network suffers as a result.

      As an example last week, we got a call from a “friend of the company” who knew someone who was having a problem. The brief we had was that they were having internet access problems. No-one onsite knew anything about the system. We went up to install a new (hardware) firewall and router and see what else we could find out about the system for them. We quoted a day for this (reduced anyway as this was a charity we were dealing with). The site has about 15 users and were running a single Windows 2000 file server. First question was “why isn’t this SBS?”. The server itself was off which puzzled us. Turns out the system had two drives and was running a mirror but both drives we offline. We feared the worst and expected to be telling the management they would need it reloaded and they would have to go back to backups. Fortunately we managed to get the drives back online and it was only after we had got back into the server we realised….the backup hadn’t been working for months. Now the annoying thing about this was we had originally quoted for a support contract for this place. But we were beaten on price. The new company supposedly came in and “fixed some things”. Last the client had heard was that they had gone bust, hence the phone call to us. The company were very luckily. If the drives had failed (as opposed to being offline) everything would have been lost!

      I’m not saying this particular supplier is going to be like that. Obviously a “proper job” is just my opinion. I feel we do a good job but I’m obviously going to be biased in that way! As for their previous work..no i haven’t seen any. However (and I can’t go into too many details about this) i have actually seen the quote we’re up against. Lets just say some of the things they specify don’t quite add up (that’s it not saying anymore!)

      The 11 days we have quoted will be the MAXIMUM they’ll get charged however it works out.We like the customer to know what they will be paying upfront. My opinion is that if the customer goes with the competition they’ll be billed for work that isn’t in the quote and it’ll probably be closer to our 11 days by then.

      Yes we do review our processes. After every install we look at how smoothly the install went, what didn’t go so well and what we can do to improve it next time.

      Razors or razor-blades? Definitely razor blades..our whole company strategy is based around building an ongoing relationship with our customers. However we’re not in a position to break even on this sort of project just to get the support contract. For one thing the figures aren’t always large enough to justify that (in this example we’ve seriously slashed our labour charges as this is a charitable organisation we’re working for) but your right it is down to your business model. In the same way as you our “life blood” is from getting support contracts and ongoing work from that but we still need to make money on projects like this. It does give us lots of leverage in negotiation to get close to the “break even” situation you talk about.

      Sorry this reply is a bit fragmented. I wasn’t sure how to post with make myself sound all defensive!

      Thanks again nick

    3. I did a follow-up post on this here…

      http://addicted-to-it.blogspot.com/2007/05/sbs-sbs-deployment-estimate-andys.html

    4. […] i posted and had a moan where i worried we may be losing customer for sticking to our principles (original post here) and was worried the client may end up getting a nasty sting if they went with what on the surface […]

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