Engineer, Procure and Construct an Online Channel

May 29th, 2011 by

I had a partner call me this week to review a customer requirement for a marketing automation. The partner has a specific product that fits into “marketing automation” space, but the customer is looking for an end-to-end solution that is managed. The components that the customers require include: CRM, email content marketing, target account and contact list generation, campaign management, content creation and distribution, landing pages, lead scoring and reporting. This is a mid-size company that has the resources to fund this level of marketing automation, but does not have the resources to hire all the people required to implement this type of solution.

This customer’s requirement is an example of what will be needed by the majority of small and medium size business to compete in the digital age. According to the Google white paper, “2011 B2B Marketing Outlook” 34% of companies marketing dollars will be spent on online channels. As reflected in the request received by the customer above, the infrastructure required to have an effective online channel are very diverse and require a specific expertise need to implement. Marketers can learn from the Resource industry and their use of EPC companies to help them with strategies to address the complexity of building an online channel.

EPC stands for Engineering, Procurement and Construction, it is a common form of contracting arrangement within the construction industry. Under an EPC contract, the contractor will design the installation, procure the necessary materials and construct it, either through their own labour or by subcontracting part of the work. The contractor carries the project risk for schedule, as well as budget, in return for a fixed price called lump sum or LSTK depending on the agreed scope of work.

In an EPC contract, the EPC contractor (EPCC) agrees to deliver the keys of a commissioned plant to the owner for an agreed amount, just as a builder hands over the keys of a flat to the purchaser. The EPC way of executing a project is gaining importance worldwide. But it is also a way that needs good understanding, by the EPCC, for a profitable contract execution. An owner decides for an EPC contract for several vital reasons. Some are:

The owner puts in minimum efforts for his project and, so, has less stress
• EPC gives the owner one point of contact. It is easy to monitor and coordinate
• It is easy for the owner to get post-commissioning services
• EPC way ensures quality and reduces practical issues faced in other ways
• Owner is not affected by the market rise
• Investment figure is known at the start of the project

Besides the plant sitting, in an EPC contract the owner will define the following:
• Scope and the specifications of the plant
• Quality
• Project duration, and
• Cost

The cost, that is the price to be paid to the EPCC, will be negotiated and finalized and paid in mutually agreed installments.

When building an online channel strategy reduce your risks and look for a company that can engineer, procure and construct an effective solution that delivers the desired results.

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