On a recent search for a programme governance seat inside a large platform migration, the approved day rate came back from the market as unworkable within a fortnight. Not by a little. Every qualified candidate priced between 35 and 90 per cent above it.
The one person who came in on budget was a project support officer from a different sector, with no supplier governance experience, whose relevant industry credential was a holiday let. That is not a criticism of him. It is a description of what the approved rate could buy.
The client did not set a bad number through carelessness. They set it the way most carve-out budgets get set: from the top down, against a total envelope agreed at signing, with the technology line sized before anyone had spoken to the market.
This is the pattern across most technology carve-outs we see. The separation cost is estimated during diligence, often from benchmarks rather than a bottom-up view of the estate. The number goes into the deal model. It becomes the envelope. Then the programme starts, the seats get defined, and the people who can actually fill them turn out to cost more than the line allows.
At that point one of three things happens. The seat is filled with someone cheaper who cannot do it, and the programme absorbs the cost later as delay. The seat stays open while the budget is renegotiated, which takes weeks the TSA clock does not give you. Or the roles go on hold while the sponsor and the advisory firm realign, which is what happened on the search above.
What sponsors can do about it
Price the critical seats before the envelope is locked, not after. A programme governance lead, a separation architect, a test lead on a platform migration: these are a small number of roles with a known market rate, and a specialist can tell you what that rate is in a day. Building the separation budget around real numbers for the five or six seats that decide whether the programme lands is cheaper than discovering the gap three weeks into a stalled search.
The market rate is not negotiable. What is negotiable is when you find out what it is.