Business development requires a balanced approach that is not skewed in any one direction and provides equally for all levels of society . Furthermore , consulting engineers must ensure that their solutions are always tailored around society ’ s long-term needs .
At an official event on 26 January , CESA hosted a Protecting Lives and Livelihoods dialogue with speakers discussing professional fees in infrastructure procurement .
Naomi Naidoo , CESA board member and Pink Africa Consulting Engineers director , presented on the impact of discounting on service delivery and economic development . Naidoo explained that the biggest factor which affects businesses is sustainability .
“ If consultants tender at rates lower than the cost to undertake the work , it will affect business operations . Often , we witness staff being required to work longer hours or being paid salaries at lower than market value , which is not sustainable and will result in the business being eventually forced to close .”
According to Triple 3 Engineering researcher and contractor Patrick Okonkwo , excessive discounts compromise the quality of service because the price point at which that service is delivered impacts on the allocation of adequate resources and time for the delivery of a good enough service . He pointed this out in his presentation on the impact of discounted / reduced professional fees on the risk exposure of contractors in South Africa ’ s private sector .
“ Excessive discounts as a business practice borders on unethical practices . When dealing with private clients , consultants are usually pressured to reduce costs , and in the public sector , it is usually the procurement regulations where tender evaluations are taken into consideration .”
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Okonkwo concluded that a third component is the inability of the consulting engineering industry to adequately communicate the value of their service to clients in terms of risk and return-on-investment .
Representing government in the dialogue was the Department of Public Works and Infrastructure ’ s chief engineer for Structural , Trevor Mathabatha , who discussed the ‘ Consultant ’ s fee — a guideline for public works professionals ’. He mentioned his department ’ s fees were similar to those of the Engineering Council of South Africa ( ECSA ).
However , if one had to dig deeper into the scope of services deliverables , one would notice the fundamental differences in what the department requires at a certain stage versus what the ECSA fees state . RACA
Though some consulting engineering firms may be busy , they only cover their overheads and realise little , if any , profit .
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