On a British Airways flight today, to Italy as it happens, I noted in the Financial Times that Sony is scaling back its television production and focusing on other consumer areas such as touch screen production and games. Also in the news this week was the sacking by UBS of 10,000 staff and its withdrawal from Investment Banking.
Another article on page 16 of the Financial Times talked of falling profits at Marks and Spencer and strategic questions about super-market Sainsburys.
What these companies have in common is this; their approach to quality and to price. My British Airways flight is more expensive than Easyjet, my Sony TV was 100 quid more than the average and the food at M&S is way more expensive than the competition. Sainsburys have historically tried to position itself at the higher cost end but struggles with itself in that strategy. My FT paper was £3.00 but the Daily Mail was only £1.00.
The big questions for us as consumers is can we afford to pay more? And if so, is it worth paying more? On my flight, is my seat better than Easyjet?, is the free food worth having, is check in and boarding better? Can I afford the M&S sandwich for lunch? Is it better than Tesco?
These same questions need to be asked by companies buying Oracle Business Intelligence consulting services. You could buy your OBIEE implementation from a low cost provider, one that charges a lower daily rate, or you could buy a premium service from a specialist consultancy.
The choices in the UK are between a consulting firm or use of independent consultants (contractors we call them).
A cheap contractor will start around 300 per day rising to 1000 for the very best. A cheap outsource consultancy will start around 500 per day rising to 2000 for the most expensive.
So, does more expensive mean better quality? Generally I will say yes, but be very careful. Some consultancies ( I won’t name them but you will know who they are) charge higher rates because of their reputation and their successful sales force. However, the person that arrives is not necessarily a premium OBIEE consultant. I know of many instances where a consultant was being charged to the client at 1,500 per day but they had NEVER implemented OBIEE or OBIA before. Three consultants at a recent engagement could not even install OBIEE 10g, and yet were getting charged in at over 800 per day each!
The problem I have with inexperienced consultants is that they implement the system in a bad way, often leaving the customer disappointed. This has two obvious effects and one not so obvious:
If the client notices the poor implementation, either the client hates OBIEE/OBIA because it doesn’t do what they were promised, and funding is cut, or someone is brought in to rescue the project costing the client much more than budget.
The not-so-obvious effect is that the customer gets a poor product that runs slower than it should, or is not easy to upgrade. They may not be unhappy, but will also not be wowed by the fantastic system that saves them lots of money and enables better productivity. The net effect of a poor implementation is higher cost (rework/expensive upgrade/lost opportunities).
The effect of a great implementation is that the customer pays less, yes, it’s more up front but pays out less in the long run, And more importantly they will realise huge savings in their internal systems.