Welch Company; Communication Metrics

THE WELCH COMPANY
440 Davis Court #1602
San Francisco, CA 94111-2496
415 781 5700




November 6, 1997                                                                         03 00050 97110601



Mr. Michael Rosenthal
Assistant Vice Provost
Stanford University
Capital Planning and Management
655 Serra Street, 2nd Floor
Stanford, CA  94305 6114

Subject:  Communication Metrics

Ref:   a. U.S. Army Corps of Engineers Report, Mar 28, 1997
          b. Cost Savings Report Oct 7, 1997


Dear Michael,

Per our discussion today, projects are getting more complex and the current building boom makes it difficult to meet scope, time and cost objectives. In fact, the world is getting more complex, as time and distance are compressed by technology. Traditional methods increasingly fail in all sectors. Stanford's experience is only one example of the general problem characterized by the complaint, I don't have time to think, that results in management by "guess and gossip." People are simply overloaded with information from email, fax, calls and constant meetings. Communication is failing everywhere.

The USACE report dated Mar 28, explains a management science I have developed over the past 15 years that solves this problem. A system that promises better "thinking" takes time to catch on, because people are skeptical. So, it has taken time to get field trials of Communication Metrics. Now the U.S. Army Corps of Engineers has tried it and reports favorable results. This method can help you succeed with Stanford's Capital Planning and Management program.

The first report explains concepts and implementation. You can make an initial assessment by reading only the Executive Summary and Appendix A, which contains comments from executives and engineers. USACE also cites a report from PG&E in Appendix C.

The second report was issued recently in response to a request by the Corps Headquarters in Washington, D.C., for cost savings estimates. Explaining why and how much cost savings result from better "thinking," is challenging. The tabbed section explains a process of reducing management rework by expanding "span of attention" that quantifies cost savings.

Communication Metrics can support Stanford's search for a new direction based on hard won experience showing that, despite having good people and traditionally effective methods, management needs a boost to deal with the

new realities of today's business environment, cited by Peter Drucker and Andy Grove.

I would like to demonstrate the technology that supports Communication Metrics, and discuss your plans for shaping an effective capital improvement program.

Thanks for your consideration.

Sincerely,

THE WELCH COMPANY

Rod Welch