Conference 7.286::digital

    >If Sun can afford sales support, why can't DEC?
    
    Funny you should mention that because Sun doesn't really have a
    manufacturing operation, it's all outsourced.  So, what does that make
    room for?
    
    re:.0
    
    Most of us we're also hit this week, including this writer.  So what? 
    It's the expertise and experienced gained that you take out of here.
    
    /d.c.

    r.0 
    I'll see your outrage and raise you one!!! During the recent TFSO we
    layed off like 5 fse's and are now hiring temps to fix systems. One
    of them was TFSO'd last year! I was somewhat distraught during this
    last episode and got athinkin'... I was gabbing with my boss who has 
    20 fse's and pointed out that I could think of enough ex-managers
    around that we could have one manager to every two field service
    people! Its a shame these people couldn't carry a tool bag anymore 
    they could spell us every once in a while.
    
    Fred

    re.: .3
    
    That is one of the things I'll never understand: we are laying off
    employees and then hiring contractors who usually work for us for
    years, who work in our offices (using our telephones, desks, computers,
    printers, faxes, etc) and who cost MUCH more per day than an employee.
    
    If you look at the Q3 sheet, the number of contractors is not
    decreasing.
    
    May be that when you look at an employee cost you have to take in
    account the cost of his/her manager(s)? Then I can understand why a
    contractor looks like less expansive!
    
    Is there somebody able to explain this to me?
    Many thanks
    �AA

    re -1
    
    Typically contractors cost us less.  We do not have to pay them
    benefits nor do their costs have to include support staff.  Our
    salaries and benefits are only part of the cost involved.  I suspect
    that the use of contractors will become more prevalent in the future,
    as they provide a great deal more flexibility during hard times - don't
    need them, you simply don't use them.  No packages, no desks or
    terminals, no computer use, etc., etc.
    

    The cost is indeed lower when you outsource if it is done correctly and
    for the right reasons. As a manager for a customer that has several
    temps. we have been able to deliver a service solution at a price
    40% lower then anyone else. However, there are some trade offs,
    usually a temp. will only last a year or so, etc. As far as cost the
    average FSE at DEC is 1.29 their hourly rate. While a temp. with the
    same experience and professional skills we can get for the same we pay
    a DEC FSE. Hence, a 29% reduction in cost. But I must stress you should
    hire temps. for the right reasons and not just to reduce cost. If the
    project is short term,etc. 
     

    The other thing is a lot of the contractors do not contribute to head
    count, but top direct expense, (i.e. "boxes of paper" as one says).
    

    Nuts!!!!!
    
    Contractors cost twice as much in salary or more,the only difference is
    their salary comes out of a different pot so the "manglers" and bean
    counters can crow that they are saving money out of their particular
    budget and they can get rid of them anytime without thought or care.
    From first hand I know people who left on the package and are now back
    on over 3 times their salary doing the SAME job so dont give me the
    "we're saving money by doing it" garbage.
    Geoff

    
    
    re .1
    
    Employee salary is not the only expense an employer has in employing
    someone.
    
    In the UK, The overhead of employing a person fulltime is several times
    the wages. Ther is government tax (National insurance contribution),
    sick pay, holiday pay. persion contributions, medical, training
    cost of hire cost of firing etc etc etc.
    
    An hourly paid contractor costs none of these, so its cheaper overall
    for the company to employ contrctors!
    
    rdgs
    
    Patrick
    

    Geoff, tell us how you really feel! :>
    
    I don't know what contractors or employees cost, but the last I heard
    was that benefits add an additional 30-40% over a base salary. Does
    anyone have hard numbers on costs?
    
    --- Gavin
    

    Well double my salary!
    Give us all the option then,I'd come back no sweat ,do the same job etc
    Be able to pay the mortgage and bills..

    	Contractors here typically expect around 50% higher pay than
    salaried workers because of the lack of job security. DEC doesn't pay
    less, it just pays differently.
    
    	Those that can work it right can do very well. Typically, they have
    their own company in some off-shore tax haven, and it is that company
    that employs them and contracts to DEC for the work. That company pays
    them a low salary so that they pay little in tax in the country in
    which they are working. The difference between what DEC pays and their
    salary is their retirement fund, social security, ...   Also, there are
    tax breaks if you work for less than a tax year in any particular
    country, so provided they switch jobs every 6 months they pay little tax
    or social security.
    

    
    
    nuts, nuts and nuts again....contractors have no company loyalty,
    will gladly leave as a higher offer comes in, and will not hesitate
    to point the customer to another vendor. more to cost than the out
    lay of $$$.
    
    rth

    RE: .12 That's close to the facts.
    
    RE; .11 You can become a contractor in just the same way I did. Throw
    in your job, your pension, your healthcare, your paid holidays, your
    company car, and your (fictitious) security, and just do it. I did,
    more than 12 years ago, and myself, spouse and three children have
    never regretted it. Except that is, for the long commutes, the weekly
    living away from home, the stress of being away most of the time, the
    taxman, the book-keeping, the accountancy fees, the lack of pension,
    the lack of holidays, the lack of healthcare, the times when there's no
    work/no pay etc. etc.
    
    Do I regret it? No. Would I change it? No. Do I whine on about the
    "lacks" above? No. So, as Norman said, get on your bike and stop the
    bloody whinging. It really gets my goat to hear people banging on about
    how "lucky" contractors are. Well, you can take the same risks we do,
    so DO SOMETHING ABOUT IT, OR STFU. 
    
    Laurie.

    RE: .13
    
    Not this one, and not a lot I know.
    
    Laurie.

    So ... we hire temps for service work and temps for consulting
    	   and temps for this and temps for that.
    
    Where is the Digital difference ...the Digital added value ?
    
    How can we tell our customers not to go with a cheaper service
    provider because of the quality of our people when we don't 
    have any ?
    
    Hello Sorbus...about that job.........
    
    
    Brian V
    

Re: the direction of this thread.

Lets put a stake in the ground right here and make some important points.

1)  It costs MUCH less to have a contractor at even TWICE a normal salary
since Digital doesn't pay benefits, admin costs, workmen's comp insurance,
etc, etc.

2)  The contractors do NOT add the Digital difference and they MAY take
another assignment for more pay at a moments notice.

Both of the above points show the two sides to the knife when using
contractors.

There are points to be made in either case.  But when the company is being
forced to downsize and there is still business to be continued then it is
up to someone to get a 'body' out on site.  Typically Digital pays around
$60 per hour (usually more, sometimes less) for 'hired guns'.  We don't
use contractors for project management but for specialty tasks.

In some cases it makes a great deal of sense.  How does HP consistently
have a lower cost of sales than Digital?  A contractor does not count
as 'overhead' expense.  Think that one through.

Chuck

    >....contractors have no company loyalty,
    >will gladly leave as a higher offer comes in, and will not hesitate
    >to point the customer to another vendor. more to cost than the out
    >lay of $$$.
    
    Geez, ignorance on a subject sure doesn't stop people from spouting
    off.  :-(
    
    With respect to loyalty, contractors can be as loyal as any employee. 
    I'm a professional (employed as a DECtemp for Digital Consulting) and
    while I'm paid by Digital, I'm doing my best to keep up-to-date on what
    Digital has to offer (NOT easy as many have pointed out in this
    conference) and presenting that information to my client when
    appropriate.  (I've already sold my client on a Digital solution that
    they didn't know existed, on one occasion.)
    
    What the previous noter is suggesting is just plain unprofessional
    behavior (both in manner and content :)
    
    As a contractor, I don't have to concern myself with the typical
    employee worries of getting promoted, office politics, etc.  Of course,
    there is the concern of the next contract - but DECtemp/Digital has
    been a relatively secure place to work.  (Knock wood . . .)  The only
    reason I would jump ship is to pursue my professional goals when they
    wouldn't be able to be satisfied by Digital & its clients here in town
    any longer.
    
    The main reason I resigned from my last employer is that I had burned
    out on the office games played on us employees (i.e. pawns).  I decided
    to take an opportunity to move out west (nobody paid for the expenses
    but me) and have more control over my career as a contractor again.
    
    I earn about 50% more than I did as an employee, which is essential
    since my wife will be having a baby in two months and isn't working
    full-time.  We're paying for a health plan provided through her
    professional association.
    
    So, please check the facts before wasting bandwidth in this notes
    conference.
    
    -Pete

    
    
    Let's stop the  contractor rathole.  My point in .0 was that we have
    more managers than UNIX worker bees in sales support and this is
    stupid.
    
    -Ed
    

    It sounds as if contracting may be a viable alternative to being a full
    time employee of Digital.  What type of guidance would you offer a
    person considering such a move???.   Is there an office within the 
    Digital organization that deals with temps/contractors that one can
    openly go to for information????   Are there any official/unofficial
    programs in place that can transition field service engineers from
    full time + deccies to contractors, ie mutually agree to ask, receive,
    and accept the current package in exchange for becoming a contractor??
    
    Any or all ideas welcome (no ratholes please).  Thanks.
    

    One needn't question the abilities or the loyalties of contractors in
    order to question the wisdom of relying upon their services.

    I'm currently working on the second of two projects where contractors
    formed the bulk of the software development team.  The code is not
    of significantly lower quality than that developed by Digital
    employees.  None of our former contractors has tried to undercut us
    with the customer.  The big problem is that everything they learned
    about 2 moderately esoteric application domains went out the door with
    them when their work was done.

    Now both customers are looking for enhancements and follow-ons and I'm
    stuck with the task of training a whole new project staff rather than
    having people in OUR organization who already know what it's about and
    who could form the core of a new team.  

    I'm also faced with the entire start-up cost that derives from showing
    newcomers how the project files are set up and explaining coding and
    design standards. That's the BIG cost of using contractors -- loss of
    continuity and expertise.

    > It sounds as if contracting may be a viable alternative to being a
    > full time employee of Digital.  What type of guidance would you offer
    > a person considering such a move???
    
    It helps if you're single and mobile.  Many prior notes mentioned
    the advantages/disadvantages to both parties (consultant & Digital).
    
    Someone mentioned something about it helping pay for the house and pay 
    for the bills.  If you play your cards right, you'll soon be on a cash 
    basis and have paid off your mortgage.  That way if you find yourself 
    sitting on your butt for 3 months (or if you feel like going Bermuda for 
    a one month vacation) you don't owe anyone anything. 
    
    From experience: It's a two edged sword and a cut throat business.  Get
    tough skin before diving in.  Also, you better know what you're doing
    (i.e. strong skill set) otherwise you'll go <poof> real quick. 
    Finally, keep in mind digital often goes this route with "tough"
    to please customers.  Guess who takes the beating while delivering the
    goods?  Right.  Now you know why the pay is "ok".

    Re .14
    Laurie,
    There's no need for the veiled obscenities in this conference (STFU)
    And no I won't,you say put up or shut up and stop the bloody whingeing
    for your info I have "put up " and leave in 3 weeks,I've had it with
    all the rubbish and am off to pastures new.
    It doesn't however stop me having an opinion,my point is that people
    get the package AND come back on larger salaries.Doesn't anyone see
    a certain ridiculousness here when we're supposed to be losing money?
    I'l spell it out,this is a recent event.
    1) Employee on project at customers site.
    2) Employee given $35,000 package to leave.
    3) Employee taken back on by DECexec as contractor on 3 times initial
    salary.1 week holiday in between.
    4) Customer still being charged at initial contracting rate by
    Digital to provide service.
    5) Digital therefore making less money out of contract as well as
    having paid $35,000 dollars to a gainfully employed employee.
    6) Former contractor actively looking for permanent position nearer to
    London,may leave in middle of project.
    I'm not "bashing" the contractors,they are looking after themselves as
    they should.I just can't accept the short sightedness of the decisions
    about who goes and who stays. I can't see any sense in the process and
    only know how morale suffers for those "real" employees left who feel
    their payrises are being given away in bad decisions.
    Simply put:
    A farmer doesn't sell his best cow to the dairy and then buy back the
    milk.
    Maybe I just don't understand the "BIG PICTURE".I'm sure I really dont
    care anymore either.
    
    I'm off to the pub.Care for a pint?
    Geoff

    	DEC is getting what it pays for. It is no longer prepared to pay
    for stable employment.
    
    	A friend of mine (TFSO'd) is on contract to DEC as a project manager. 
    The project is probably 18 months duration, but DEC only offers 3
    months renewable contracts, and there is a likely offer of a (non-DEC)
    permanent job in another country. In a couple of months that project
    could be without a manager. The tax temptations of the country switch
    in mid year would be strong.
    
    	In my experience DEC gets a lot better loyalty from contractors
    than in gives to them. My friend's boss knows the situation, but can't
    change DEC's rule here of 3 month contracts. If DEC isn't prepared to
    commit anything beyond 3 months then it shouldn't expect anything
    beyond 3 months. My current project leader is a contractor who has 
    been working for DEC for several years, and if he left, the project (and
    a customer product) would collapse since he is the only person that
    knows it fully. I hope DEC is paying him a lot for all that the lack of
    job security implies. See the discussion about DEC France layoffs to
    estimate how much extra he should be being paid compared to an
    employee.
    
    	Dave, who is holding a barbecue tomorrow for everyone capable of
    reading notes files, because he started working for DEC on 1-May-1974.
    
    p.s. there is a contractors notes file on node LOBLO. Nothing to do
    with me - I just manage the machine.

    Thank you for the information regarding Digital Contractors.  It gives
    me a place to look for info and a heads up on what to expect.  Sincere
    thanks again.
    

    .10�         <<< Note 3041.10 by HOTAIR::ADAMS "Visualize Whirled Peas!" >>>
    .10�    I don't know what contractors or employees cost, but the last I heard
    .10�    was that benefits add an additional 30-40% over a base salary. Does
    .10�    anyone have hard numbers on costs?
    
    Last *I* heard,benefits cost another 100% of your salary.
    
    Ken

    re:.26
    >Last *I* heard,benefits cost another 100% of your salary.
    
    I don't think so... for our own budgetary purposes, we use a figure in
    which the ENTIRE LOADED COST is about twice the average salary.  But
    that includes floor space, infrastructure, and other non-benefit
    expenses.  Many but not all of these apply to contractors.

    According to an article (which was mostly dealing with the high cost of
    labor in Germany) in the S�ddeutsche Zeitung a few days ago, the
    benefits (vacation, social security etc.) add about 85% to the gross
    salary; in US, the figure was aid to be slightly below 40%.
    
    These figures do not include any non-benefit costs (infrastructure etc.
    as listed in .-1)