From Chaos to Control - Episode 9

A one year contract that has 90% utilization is in fact losing money. A three year contract with somewhere between 60 to 100%, let's say 6 minimum of 60% utilization or effective coverage is still saving money due to the fact that it's a longer period and it has a higher savings value than a single year contract. So these things are important to note. So often we do find environments where we've been told that they're highly optimized. There's lots of contracts already purchased. But if we look at the efficiency of the contracts, they are not as efficient because what happens over time? Engineers change SKUs, they may even change the scope and therefore resources fall outside of these contracts and that becomes hard to manage. Foreign.