6 November 2009

Dedicated team or fixed price?

About Hugo Messer

Hugo Messer is a Dutch entrepreneur, distributed agile team specialist, and author. He is the founder and owner of Bridge Global, a software services provider, and ekipa.co., an agile coaching agency. He has been building and managing teams around the world for the past several years. His passion is to enable people that are spread across cultures, geography and time zones to cooperate. Whether it’s offshoring or nearshoring, he knows what it takes to make global cooperation work.

9 thoughts on “Dedicated team or fixed price?
  1. Hi,

    I am freelancer and developed so many projects in c#, VB.Net, SQL, Sharepoint etc.

    Shahbaz Aslam

  2. SHahbaz, maybe you can reply on the content in our blog. we don’t intend to use it as a platform for you as freelancer to promote yourself.

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  4. I am working with Bridge at the moment on a project and I can confirm the advantages of the dedicated approach. However much one may dream of defining the specifications 100 per cent in advance, there will always be the details that have been overlooked, the new ideas that a client throws up, and simply the fact that it is while working on a project that new thoughts emerge. If each one of these variations had to be the subject of a price negotiation between us, the subcontractor and the client because “it wasn’t in the original contract” it would considerably add to the stress levels of managing the project. By working with a dedicated team, you keep control over what levels of flexibility are to be permitted in a human way and control the budget on a global scale rather than on a specification by specification level.

  5. What about the disadvantages?
    Plus I don’t agree with all advantages:
    The need for 100% clear specifications disappears => use agile or some process to deal with changes

    disputes about the workload => fixed price shouldn’t have a dispute about this, only when the project is complete ;-)
    even within the customers organization you don’t want to continue projects forever.
    So the real question is, when is a project finished and can we define it upfront or should we deal with changes over time
    and have a contract accordingly.

    The outsourcer/customer has full control over planning => does he want that?

    team can still change over time (people leaving the company is more common in these countries)

    What about transferring risk?

    The real question is what does the customer want with outsourcing.
    The used delivery model should deal with these requirements.

  6. Many lost words for discussion.
    what is about disadvantage for your topic?.
    The outsourcer/customer has full control over planning => does he want that?
    I been looking for step by step and cleary to knowing about this,but its okey..you may more explanation for this

  7. We also observe raising popularity of dedicated team models. As there are more communication tools (Google Wave for example), it is getting more easier for customer to manage the distributed development.
    According to “Central and Eastern Europe IT Outsourcing Review 2008” – a research conducted by Ukrainian High-Tech Initiative, during 2003-2007 the customers were tending to switch from project-based outsourcing model to hiring dedicated programming teams, – so that the customers contract and manage IT staff directly. Although fixed-price project model seems to provide less risks, it also restrains significantly the development process and can result in overestimated budgets. According to the research results, since 2008 until 2008 the number of project contracts has fallen by 30-35%.

  8. Today, the vendor ought to be fully in synch with the needs of the client and innovate to exceed client’s expectation. With constraints on the budget and ever raising bar set by the end user- on the client side – there is no one model that can fit all scenarios.
    We have successfully tried out a model where a “static” core dedicated team co-exists with a “dynamic” – fixed price team. This model attempts to bring in the benefits of both the worlds and we (vendor and client) have seen the benefits.
    Caveat: Can’t start off with this model at the start of an engagement. But over a period of 6 months to a year, we can comfortably settle in to this model.

  9. Nice article, about the important of team specially dedicated team and it works are awesome, if we take the help of there it will useful for our organisation, and freelancers all no able for various projects, thank you.

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