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This. The point of a ballpark estimate is to answer the question, "Is this in the ballpark?" Namely, can I afford it? Is it even worth paying you $1,000 for a

by basseq 10y ago

This. The point of a ballpark estimate is to answer the question, "Is this in the ballpark?" Namely, can I afford it? Is it even worth paying you $1,000 for a discovery session if the implementation is going to cost me 10x my budget in any case? Is it worth taking the next meeting with you? The author is right about anchoring to value, and the author is right that it's impossible to fully-scope a project in a minimal amount of time. But you're the expert! So the right answer is: "We'd look to get a lot more accurate on cost, and a Discovery Session might be a good way to get you an accurate estimate on the cheap. But to get you a sense of magnitude, similar clients have paid $x-(x+20%) and have seen 10x returns. How does that fit into both your budget and the business case you had in mind?"

hkmurakami 10y ago
A good analogy might be one's expectations heading into a meeting with a lawyer. You'd want to know whether this will cost $3,000 or $30,000 and would rather not pay the $500 fee for the initial consultation to find out.
basseq 10y ago
And by the way, the slippery slope of this [warning: logical fallacy] is the argument, "I can't tell you what it's going to take until I've already done it. 100% accuracy!"
scrumper 10y ago
A good idea here is to deliver some tangible value to the client (something more than simply a better view of cost) after the discovery session. A roadmap, prioritized use cases, conceptual designs, or whatever makes sense for any given situation. You can charge more for the session that way too. Otherwise I completely agree with your 'right answer' and how you framed it: "You're the expert". An estimate by comparison is no bad thing, and demonstrates experience.
- thecosas 10y ago
  From the article: At the end of project discovery, you’ll find that 3 exciting things will happen: 1. Now you’re allowed to ask how much the project will cost! You thought I had forgotten about that, didn’t you? It’s OK – I know you’ve been dying to know when you can ask, and the answer is, “now”. And the best part is, I’ll be able to give you a real answer, not a ballpark estimate. 2. You’ll have a more in-depth understanding of your project. From pros & cons to potential profitability, you’ll have a newfound sense of x-ray vision for how your business is currently operating vs. how the new project will enable it to operate. You’ll have a rock-solid grasp of why you want to do this project and what you’ll get from it. 3. I will hand you a complete project plan. This project plan covers all the particulars we uncovered during discovery; this plan is yours, bought and paid for. If you want, you can use this plan to execute the project yourself, or even shop the plan to other consultants for an estimate.
gutnor 10y ago
> similar clients have paid $x-(x+20%) That's key. A small business like his is probably not all over the place, they must be hired for a limited categories of problems. After 12+ years doing it, the author should be able to ballpark something within a set of assumptions that will be confirmed during the discovery phase. I have seen companies with vastly different price point. There is a huge difference hiring a company that charge $2000/manday vs one that charge $200. ( not to say that you don't get your money worth with the $2000 guys but you don't need the Apple vs Samsung lawyers to represent you against the plumber that fucked up your office kitchen tiles when fixing the sink )
redleggedfrog 10y ago
>> Here's a secret for consultants: the attitude espoused in this blog post is losing you sales. << That's correct. This makes me sound bitter, but here's how it really works: They ask for a ballpark estimate, and you quickly throw out a number that's believable but not too high so as to scare them off. This is usually done by a sales person who IM'd a free developer and gave a two or three line summary of what the client is suggesting. Then there is some back and forth, where they customer adds or removes requirements, and the number changes somewhat accordingly, but really, in the context of sales, not technical challenge. "Oh we wrote X for some other client a while back, we'll throw that in for free." Then it might get complicated, and you get nervous, and you suggest having the client pay to do a detailed analysis. The customer says no, cause, you know, those ballparks are awesome and free. You agree on an approximate number and contracts are written up. Because really, the ballpark is the actual estimate. We were fools to think otherwise. But of course there is lots of wiggle room and vagueness written into the contract because you nor the client didn't really want to spend much time fleshing it out. Customer signs. Contrary to what you might think, you just won! You hooked 'em! Now, you work on the project, and maybe you hit the ballpark, and maybe you don't. If you don't you go back to the client and say, "Well, you know it was just a ballpark estimate, we had lots of new things come up, and you added this and that, and now it's going to cost more money." Customer can't argue too much, because they didn't want to pay for a detailed analysis, and they did ask for a ballpark. And now they're already in it for some money, and to bail now would mean losing that investment. So they spend more. Lather, rinse, repeat until the project is done or the customer is out of money. Now don't think I don't find this system awful - I do. But that's how it works. You'll never get it to change because it will always involve ignorant sales people and ignorant business owners, and they are playing a social game, not detailing a technical endeavor.
- jrs235 10y ago
  Correct. And charging a "small" amount to gather requirements is a quick and easy way for the consultant to determine if the potential customer is a good fit. A customer that understand that spec work takes time and resources and is willing to pay for the work is also a potential client that will, when they make change requests or feature/scope creep, understand that they should/will be paying for those on top of what the spec says. Everyone is correct that the author is losing business by working the way he does... but he's okay with that because he's cares more about client/customer fit (and quality) than work volume.
btilly 10y ago
That conversation will hang you. Because now $x is the figure in their head, and being off by a factor of 2 will kill you. But a single unclear assumption can be an order of magnitude price difference. For a real example from ad tech, "We need access to a DMP (Data Management Platform) to learn more about our visitors." "That will be about $5k/month for a license." "That's fine." Oops, you expected to be able to get what the DMP thinks about each individual customer and do the analytics on your side? That license only lets you take a pool of people, and get back aggregate statistics. Not collect per person data... You have to communicate orders of magnitude, and keep stressing that you'll work with them to figure out the cheapest thing that makes sense, but costs can jump very, very quickly.

by basseq 10y ago

hkmurakami 10y ago

A good analogy might be one's expectations heading into a meeting with a lawyer. You'd want to know whether this will cost $3,000 or $30,000 and would rather not pay the $500 fee for the initial consultation to find out.

basseq 10y ago

And by the way, the slippery slope of this [warning: logical fallacy] is the argument, "I can't tell you what it's going to take until I've already done it. 100% accuracy!"

scrumper 10y ago

A good idea here is to deliver some tangible value to the client (something more than simply a better view of cost) after the discovery session. A roadmap, prioritized use cases, conceptual designs, or whatever makes sense for any given situation. You can charge more for the session that way too. Otherwise I completely agree with your 'right answer' and how you framed it: "You're the expert". An estimate by comparison is no bad thing, and demonstrates experience.

thecosas 10y ago
From the article: At the end of project discovery, you’ll find that 3 exciting things will happen: 1. Now you’re allowed to ask how much the project will cost! You thought I had forgotten about that, didn’t you? It’s OK – I know you’ve been dying to know when you can ask, and the answer is, “now”. And the best part is, I’ll be able to give you a real answer, not a ballpark estimate. 2. You’ll have a more in-depth understanding of your project. From pros & cons to potential profitability, you’ll have a newfound sense of x-ray vision for how your business is currently operating vs. how the new project will enable it to operate. You’ll have a rock-solid grasp of why you want to do this project and what you’ll get from it. 3. I will hand you a complete project plan. This project plan covers all the particulars we uncovered during discovery; this plan is yours, bought and paid for. If you want, you can use this plan to execute the project yourself, or even shop the plan to other consultants for an estimate.

gutnor 10y ago

> similar clients have paid $x-(x+20%) That's key. A small business like his is probably not all over the place, they must be hired for a limited categories of problems. After 12+ years doing it, the author should be able to ballpark something within a set of assumptions that will be confirmed during the discovery phase. I have seen companies with vastly different price point. There is a huge difference hiring a company that charge $2000/manday vs one that charge $200. ( not to say that you don't get your money worth with the $2000 guys but you don't need the Apple vs Samsung lawyers to represent you against the plumber that fucked up your office kitchen tiles when fixing the sink )

redleggedfrog 10y ago

>> Here's a secret for consultants: the attitude espoused in this blog post is losing you sales. << That's correct. This makes me sound bitter, but here's how it really works: They ask for a ballpark estimate, and you quickly throw out a number that's believable but not too high so as to scare them off. This is usually done by a sales person who IM'd a free developer and gave a two or three line summary of what the client is suggesting. Then there is some back and forth, where they customer adds or removes requirements, and the number changes somewhat accordingly, but really, in the context of sales, not technical challenge. "Oh we wrote X for some other client a while back, we'll throw that in for free." Then it might get complicated, and you get nervous, and you suggest having the client pay to do a detailed analysis. The customer says no, cause, you know, those ballparks are awesome and free. You agree on an approximate number and contracts are written up. Because really, the ballpark is the actual estimate. We were fools to think otherwise. But of course there is lots of wiggle room and vagueness written into the contract because you nor the client didn't really want to spend much time fleshing it out. Customer signs. Contrary to what you might think, you just won! You hooked 'em! Now, you work on the project, and maybe you hit the ballpark, and maybe you don't. If you don't you go back to the client and say, "Well, you know it was just a ballpark estimate, we had lots of new things come up, and you added this and that, and now it's going to cost more money." Customer can't argue too much, because they didn't want to pay for a detailed analysis, and they did ask for a ballpark. And now they're already in it for some money, and to bail now would mean losing that investment. So they spend more. Lather, rinse, repeat until the project is done or the customer is out of money. Now don't think I don't find this system awful - I do. But that's how it works. You'll never get it to change because it will always involve ignorant sales people and ignorant business owners, and they are playing a social game, not detailing a technical endeavor.

jrs235 10y ago
Correct. And charging a "small" amount to gather requirements is a quick and easy way for the consultant to determine if the potential customer is a good fit. A customer that understand that spec work takes time and resources and is willing to pay for the work is also a potential client that will, when they make change requests or feature/scope creep, understand that they should/will be paying for those on top of what the spec says. Everyone is correct that the author is losing business by working the way he does... but he's okay with that because he's cares more about client/customer fit (and quality) than work volume.

btilly 10y ago

That conversation will hang you. Because now $x is the figure in their head, and being off by a factor of 2 will kill you. But a single unclear assumption can be an order of magnitude price difference. For a real example from ad tech, "We need access to a DMP (Data Management Platform) to learn more about our visitors." "That will be about $5k/month for a license." "That's fine." Oops, you expected to be able to get what the DMP thinks about each individual customer and do the analytics on your side? That license only lets you take a pool of people, and get back aggregate statistics. Not collect per person data... You have to communicate orders of magnitude, and keep stressing that you'll work with them to figure out the cheapest thing that makes sense, but costs can jump very, very quickly.