CONTACTS 
0201 - Noresco                            650 589 3700 fax 3750
020101 - Mr. David M. Theriault; Program Manager

SUBJECTS
Sales discussions
Cost Benefit Overhead
Calculate Risk Management Exposure NPV
Cost Benefit Calculations Communication
Buy Off Mistakes Rather than Fix with SDS
Cost/Benefit, Fear, Faith
New Methods Must Be Specified

1309 -    ..
1310 - Summary/Objective
1311 -
131101 - Followed up work at ref SDS 3 line 37, ref SDS 2 line 36, and
131102 - ref DIP 1 line 30 including this record and the PG&E memo, ref DRP 2
131103 - line 16, and Justice Mosk's remarks, ref DRP 1 line 23.
131104 -
131105 -
131106 -
131107 -
1312 -
1313 -
1314 - Discussion
1315 -
131501 - David asked about my progress at PG&E using Communication Metrics.
131502 -
131503 -     I explained the PG&E work is completed.  I mentioned the possible
131504 -     opportunity with Kwan Henmi at the Airport.
131505 - ..
131506 - He asked how well my work is received by General Contractors?
131507 -
131508 -     I explained GC's often feel they cannot afford my work because
131509 -     they believe they can build the job with "conversation," which
131510 -     they call "expediting."  They feel my method takes extra time.
131511 -
131512 -     When "expediting" fails, General Contractors "buy" another job,
131513 -     hoping to get well using the methods that failed on the last job.
131514 -     It is hard for "contractors" to justify allocating money for tasks
131515 -     they feel their management should be able to perform.  They do not
131516 -     realize the business climate has changed, in that management
131517 -     cannot keep up with the increased flow of information.  Ignorance,
131518 -     fear and denial impede use of Communication Metrics.  Those who
131519 -     are beginning to sense this growing new challenge, feel
131520 -     constrained by competition to avoid budgeting for it.  They are
131521 -     afraid they will price themselves out of a job.  Like CPM 40 years
131522 -     ago, contractors budget for what is specified, and try to minimize
131523 -     management support in "overhead" accounts.  The suggestion to
131524 -     reduce the budget for other "management" support, like home office
131525 -     support and cost and schedule control, and allocate it to
131526 -     Communication Metrics, is rejected on the grounds they need home
131527 -     office support, and cost and schedule control.
131528 -     ..
131529 -     My strategy is to work through architects to specify
131530 -     "Communication Metrics" so contractors can allocate a budget,
131531 -     similar to nails, conduit and other stuff, without concern they
131532 -     are pricing themselves out of the job. This requires
131533 -     demonstrating, like at PG&E, the value of the Welch method.
131534 -
131535 - David said his firm is growing and exploring new markets.  He is
131536 - opening an office in Southern California to support a major project
131537 - they have with the City.  He is just completing a lighting and power
131538 - requirements retrofit project for Safeway on several of their stores.
131539 - ..
131540 - He said their firm has recently been awarded major new contracts
131541 - to do similar work on the US Congress and the Library of Congress.
131542 -
131543 - I offered to do a few pro bono meetings to demonstrate how my work
131544 - accomplishes risk management objectives by avoiding mistakes that
131545 - cause extra costs and schedule delays, per ref SDS 4 line 185.
131546 -
131547 - David said Noresco is beginning to market it services to DOD.  He
131548 - feels Communication Metrics methodology described in the documents I
131549 - submitted, ref DIP 1 line 33, is more suited to DOD work than to the
131550 - kind of work Noresco is doing now.  I explained that Communication
131551 - Metrics is suited to work that requires knowledge and ideas and timely
131552 - performance of contract requirements.  Most "work" falls within this
131553 - domain.
131554 - ..
131555 - David is meeting with the President of Noresco on Monday.  He
131556 - plans to discuss with the President using Communication Metrics, and
131557 - will try to arrange a meeting so I can explain the ideas.
131558 -
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1316 -