Re: Captivate video pricing

Subject: Re: Captivate video pricing
From: Peter Neilson <neilson -at- windstream -dot- net>
To: Technical Writer <tekwrytr -at- hotmail -dot- com>
Date: Thu, 03 Jun 2010 11:22:08 -0400

Technical Writer wrote:

> It is the area of pricing adjustments for projects of different scope that I am most in need of advice

Once again I've not got what you are asking for, but I do have a
suggestion.

Raytheon has been a successful vendor to the US military for decades. It
might be worthwhile to study their strategy. As I understand it, they
come up with a bid to do /precisely/ what was asked, and nothing more,
cutting their costs to the bone or less. They understand that the
original specification for the project will be incorrect, and that (this
is the key) the project will have to be augmented or done over.

The people working on the project generally are not paid well, and are
told not to make suggestions or corrections. Instead, work is judged to
be complete once it appears to match specifications.

If, during the ongoing development, the customer asks for changes, that
is an extra price to be negotiated or even put out for a new bid. But of
course Raytheon now has the inside track.

Eventually the system will be delivered, and the brass will discover
that is not what they wanted, but instead what they asked for. The RFQ
for the second version of the system goes out, and Raytheon is best
poised to win the bid.

Source: Old-time Raytheon insiders I've known.
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