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> A lot of the pathologies involved in metered billing, time tracking, and perverse incentives vanish when you bill days instead of hours. Billing daily and no
by PragmaticPulp 4y ago
> A lot of the pathologies involved in metered billing, time tracking, and perverse incentives vanish when you bill days instead of hours.
Billing daily and not tracking time doesn't make lazy contractors less likely to be inefficient. If anything, it gives them more opportunity to obscure what they're doing.
The only model that really eliminates the perverse incentive to be inefficient is project-based billing.
- tptacek 4y agoI'd always prefer project billing to T&M billing, but even if you're stuck doing T&M billing, if you're in tech, you can always eke out an improvement by not billing hourly.
- thebean11 4y agoProject based billing just creates a different perverse incentive of churning out garbage that technically meets requirements
- shkkmo 4y agoIt also makes on fly design changes harder and makes managing scope creep critical.
- tptacek 4y agoNot really. You can bid a project-priced project with T&M overages, which is what every project at Matasano did; Matasano was founded by @stake people, which is where we got our project structure from; @stake was Cambridge Technology Partners people, which is presumably where they got it from; and so on down the line all the way back to, I assume, Samuel Adams or Patrick Henry or some other famous Bostonian who came up with the concept. Just break the project out by week (or by day if it's short) and provide a "total project price" line, and then a clause saying you'll charge overages at a pro-rata day rate. Of course, you can decide whether or not to actually charge OT; if you're OT because of something you did wrong, you're best off not charging, while if the client did something flagrantly wrong, like not kick off the project until 2/3rds of the ostensibly billable time was over, you're well within your rights to do so. This stuff isn't hard, and I've been a little confused for, like, about 17 years as to how message boards manage to make it seem complicated. If this is news to you, and you start doing it yourself (you should; it's easy, aligns incentives, and will probably make you more money) you have to credit me, but also cite the whole Apostolic succession (Matasano, @stake, CATP, ..., Paul Revere) I just did.
- ornornor 4y agoI think the difficulty in software comes from the fact that it’s very hard (impossible?) to provide estimates because you never know what problems you’ll run into until you do. And so how can you tell “project will take 8 weeks, times weekly rate, for a total cost of X” under these conditions?
- kqr 4y agoThe way you phrased this makes it sound like you're in favour of using a design after you've discovered it's inferior to an alternative.
- v-erne 4y agoIsn't "churning out garbage that technically meets requirements" a motto of IBM Global Software Services (or whatever they name themselvs these data). But jokes aside one of my friends seen this kind of setting degrade to "our lawyers will talk to your lawyers about this change request" on every piece of communication between client and big software consulting company.