Received-SPF: none
 receiver=realpeople.com; client-ip=206.176.250.137; envelope-from=eiger@databright.com
Mime-Version: 1.0 (Apple Message framework v753.1)
In-Reply-To: <list-1560745@realpeople.com>
References: <list-1560745@realpeople.com>
Content-Type: text/plain; charset=US-ASCII; delsp=yes; format=flowed
Message-Id: <34AD99F8-FA9A-4950-BAED-5AF6C3FA63DD@databright.com>
Content-Transfer-Encoding: 7bit
From: Lenny Eiger <eiger@databright.com>
Subject: Re: [Hx] Typical Fees
Date: Wed, 25 Aug 2010 12:46:37 -0700
To: "Helix Discussion List" <Helix-L@realpeople.com>

On Aug 25, 2010, at 10:49 AM, Steven Finder wrote:

> Let me wade in here from the perspective of a customer. This is not  
> just a response to Lenny but to everyone's comments. I just  
> happened to pick this particular email to respond to.
>
> All this talk about how much to charge and whether it is client  
> centric or win win is just irrelevant. From the customers perspective.
>
> As a customer, I hate hourly wages. I hate the way lawyers bill. I  
> hate the idea that every little process and question has a price  
> tag. I hate not knowing how much something is going to cost. I hate  
> to see the meter clicking.
>

Yes, but when you hire a lawyer, you pay their fee. You don't always  
get to choose. Client-centric may be irrelevant to you, but I can  
guarantee you that most of the Helix developers aren't making a  
living, not as you would describe it. I say its time to have  
developers take a stand to make a living - for themselves.


> Question: How many of you enjoy watching the meter in a taxi  
> getting bigger? How many of you would prefer to just pay a set  
> price for a taxi ride?

There are plenty of taxi routes to an airport, where things are  
known, that are fixed. But they won't fix a price if traffic is part  
of the picture, and they don't know. That's smart. People get in  
taxis regardless.

> What I want as a customer is to say to me, this is what it is going  
> to cost. Then when I get over my sticker shock and we agree, then  
> go out and do it for the price we agreed. If we negotiate a lower  
> price then that is the price we agree to. If it isn't a fair price,  
> then don't agree to a lower price and stick to your guns. If you  
> don't get the business you don't get the business. Sell on value.
>
> Bid it like every construction company bids a project. Be smart  
> about the bid. If you have a clear understanding of the project and  
> a clear understanding of the current status of the collection (if  
> any) and can't estimate a good price then you aren't really an  
> expert. (note, this is my view as a customer). By the way, the  
> price you estimate is the price at which you believe you will earn  
> a fair profit given the invariable issues that are sure to arise.  
> And when issues that arise are beyond the scope of agreement, then  
> you negotiate a change order or addendum.
>

The issue is the size of a developer's company. I can't afford to bid  
on projects. I don't do it. I talk to the client and if I am the  
right guy, then we go forward. I don't do competitive bids. I don't  
have a bidding department. I certainly won't write specs for a client  
without being paid for it. I will write a one or two page proposal,  
for the project, or for the writing of specs.

I often do things in phases.


> As a customer, I don't like the idea that I am paying for someone  
> to figure something which is what happes with an hourly wage (even  
> if it doesn't, I am going to think it does). For example, if I am  
> contracting with someone and they have to go look up something or  
> ask someone else for help I don't want to be paying for that. I  
> want that to be on their time. By the way, I know of no medical  
> care that charges by the hour. In other words, as a physician if I  
> have to go do some reading about a disease process or a new  
> treatment for a patient, I don't get to charge that to someone. But  
> when you are doing hourly work for me, as a customer, that is what  
> I worry about happening.

This is unreasonable... like others have mentioned, clients have  
never given me a spec. That means I have to figure out 1) what they  
want, 2) what they really want, 3) help them to understand that it  
isn't what they want and present them with a proper solution, 4)  
figure out how to do it, including mapping it out properly so that it  
can be done well, and 5) implementing it. I often operate as a  
business management consultant and have been educating myself in that  
regard since 1983.

Developers need to meet a client at their level. If one is "just a  
programmer" then you will get paid for that. However, most of my  
clients expect a lot from me and often are getting a much better deal  
than they would hiring a management consultant to map things out first.

Clients don't know what programming tasks are. When you ask an expert  
to do something you rarely tell them how to do it. Further, no  
developer knows everything, and I would rather have them find out an  
answer than make stuff up. I would also be happy to pay for the time  
and the expert's time as well.


> So stick with project bidding. Break it into chunks (phases) if it  
> helps to make the bidding more realistic. Make sure that the bid  
> price you quote pays you a fair profit. You are entitled to it.  
> Keep your inherent hourly rate to yourself. Renegotiate change  
> orders as the project morphs.

When it works, that's fine. If there is a start and end one can see  
that's great. However, what happens when you have a contact for 15K,  
let's say and when you are done the client wants to add something  
that will be an hour or two of work? Should you send him another  
contract and wait for papers to go back and forth? Probably not.  
There are clearly different kinds of projects.

We are flexible and work with our clients in whatever way makes sense  
to them. But I no longer agree to do things that stick me in a box.  
We have worked on things free for an entire year when it was required  
to complete our agreement. I'm not doing it again. I am careful to  
make sure all deals work for me as well as for the client. Sometimes  
that means I make $300 an hour when I am bidding a not-to-exceed  
price on something. Usually, it works out, but like I said earlier,  
if they want me to gamble, they have to do so a s well.

If you sense a tone in here - I am not directing it at you. I am  
simply tired of people expecting me to do things for free. I have to  
appreciate that I am a responsible member of society trying to make a  
living. Sometimes that means the client can't have it both ways...

Lenny