Software companies usually have good productivity benchmarks for
the product side of the business, but service metrics--especially for
high- cost consultants and application developers--are often a black
hole. However, a new R.W. Baird report on "Internet Professonal
Services" helps fill this gap by analyzing performance data from 18
public firms that sell Web development and creative services. The most
successful firms report annual billings of more than $200,000 per
consultant; the most productive, Mainspring, is a relatively small
strategy firm whose 180 consultants currently average $251,000 in
billings. The top firms typically achieve utilization rates of 60% or
better, while low performers have rates in the 30%-40% range. Turnover
is another key variable in professional services: The industry median is
18% a year, but the two firms with the lowest revenue per consultant
seem to have problems hanging on to staff; their turnover rates are
40%-45%.
Internet Professional Services, 4/9/01, Gary Dean, vice president,
R.W. Baird & Co., 2525 West End Ave., Nashville, Tenn. 37203;
615/341-7119. E-mail: gdean@rwbaird.com.
ORACLE chairman Larry Ellison on trying to integrate software from
multiple vendors: "It's like if you want to buy a car. Would
you get an engine from BMW, a chassis from Jaguar, windshield wipers
from Ford? No, of course not. Right now with the software that's
out there, you need a glue gun--or hire all these consultants to put it
together. They call it best of breed. I call it a mess." (Quoted in
Fortune, 11/13/00)
NOVELL chairman Eric Schmidt on the role of his company's
reseller partners after an announced merger with Cambridge Technology
Partners, a major consulting firm: "The best way to screw this
whole thing up is to tell our partners we don't need them any more
because we're going to do everything through CTP. All consulting
companies are not the same. We have to determine what solutions Deloitte
& Touche offers, for example, and figure out whether they compete
with CTP." (Quoted in Sm@rtPartner, 3/19/01)
WEBSENSE chief technology officer Harold Kester on the problem of
"cyberslacking" among office workers: "Seventy percent of
Internet porn traffic occurs between the hours of nine and five."
(Quoted in Information Week, 1/22/01)
AMAZON.COM spokesman Bill Curry on why investors should let his
company reset the price of employee options: "Every employee has
the power to reprice their options package. It's called, OI
quit.'" (Quoted in The Industry Standard, 3/26/01)
CERNER CORP. chief executive Neal Patterson on his feeling that the
company's parking lot is an appropriate measure of employee
commitment: "It should be substantially full at 7:30 a.m. and 6:30
p.m. The pizza man should show up at 7:30 p.m. to feed the starving
teams working late. The lot should be half full on Saturday
mornings." (Quoted in The Wall Street Journal, 3/30/01)
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