OPEN INSIGHTS Newsletter
Issue 45 – Contractualities
July 1, 2008
by Sean Hull
OPEN INSIGHTS Newsletter
Issue 45 – Contractualities
July 1, 2008
by Sean Hull
Happy Independence Day, hope everyone gets some good rest & relaxation this weekend!
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In This Issue:
Most of the open insights newsletters come from lessons and wisdom I’ve stumbled upon in books I’m currently reading, that resonate with some past business experience or more often with some current experience I’ve had with a client.
I find that every difficult experience can be turned positively as it provides a lesson for you to build on in the future, so these struggles are business-character building.
I engaged with a client recently, and we drew up an outline of what needed to be done. The outline was fairly specific, and most of that language made it’s way to the contract itself, after verious conversations on the phone, and in person. We all seemed to be on the same page.
The project needed to be completed in short order, in roughly three weeks. This was complicated by my existing engagements, but due to the urgency, the client agreed to pay more to have it done on short notice. I agreed as well, and planned out time, offhours and weekends to complete the work. As things moved forward we quickly encountered some hurdles.
After discussing the issue with the client, we resolved that we would shift gears slightly. Instead of working on production machines, we would build new machines, build them to spec, and then move the production data over during a small maintenance window. Though we were shifting gears and had in essence wasted some time already, I did not extend the scope of the fixed fee project because we also agreed to a slightly smaller application set which would need to be tested. Only one application collection (schema) rather than over ten.
Moving forward it took the client some many months to setup those machines. This seemed fine to me as it gave me more breathing room anyway. Once those machines were setup, I proceeded to do my work and build out the Oracle setup.
In moving towards the end of the project, however, we reached a rather bigger snare. While planning our last maintenance window, and after some time had elapsed, the client decided to focus on a different application collection (schema) to do it’s testing again.
The change happened primarily because time had elapsed, and new business needs had arisen. However that change required a lot of new setup, and new testing. During that testing, we ran into a real snag, which was the direct result of our changing focus. That required a number of items to be rebuilt, requiring more work, and was clearly out of scope.
As one might expect, the frustration as a consultant is in having a moving target with which you’re working towards. Guessing the scope and cost of a project is always a leap of faith, without throwing in the complexity of a changing scope of work.
What’s more in this case it was a project which had been drawn out to over five months, but which originally required three weeks, and immediate urgency. Not that those five months required constant work, or more work overall, just that as things get drawn out, attention and focus changes, as does a clear idea in everyones mind, of the objective. Further, the initial shift in gears met with little resistance on our part. We wished to show good faith, flexibility, and we understood the scope being reduced.
Our resolution was to re-outline the contract in detail, and have it reviewed per the "lesson" section below. We put more detail into that addendum agreement, and had the right parties review it. By showing some flexibility and understanding, the client could sit back and also see our side, and became more amenable to our claims and perspectives going forward.
1. Clarify who will be involved in reviewing deliverables.
If they are not the economic buyer, or are different from the one who is reviewing the contract initially, then a list of the deliverables should be shown to them for review as well.
2. Ask the question "Is there anything missing on this contract that you’d like to see?"
Bring up some hypothetical scenarios of things that would be out of scope. Make clear that out of scope items will be billed separately or not done at all. Also discuss the spirit and the letter of the contract.
Explain that as the project progresses and new items come up, you will be checking them closely against this document to determine whether things are in or out of scope. Remind them that fixed fees put the responsibility of watching the scope and creep of the project in your hands, which is a good thing for them, ie making life easier, but it might at times sound adversarial.
3. Explain the shift in management with a fixed fee project
With hourly fees, budget and cost management is left to the client, and the consultant has to be less concerned about it. The client will naturally manage a cost if they have control over it. As such the consultant can effectively defer to the client’s opinion, and direction, after giving their recommendation. With fixed fee, all of the details must be ironed out up front, and the consultant must manage time and materials. He then is managing the budget.
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In our last interview we had the opportunity to talk with Norman Yamada CTO of Millburn Corporation.
Norman shares with us his experiences providing world-class computing solutions, and the pros and cons of doing it with open source.
In the style of classics like "Barbarians At The Gate", Cohan’s book brings you inside the world of trillian dollar moving ibanks, billion dollar fees, and million dollar bonuses, and weaves a story that intrigues as it educates. If you want to understand the business and economics, and at the same time enjoy the story of ambition and power, both it’s triumph, and crash, this is a must read.
Just published this year, I’ve been wanting to read Rothkopf’s book since I saw it reviewed in the Economist a couple of months ago. It’s good stuff. If you’ve at times wondered whether the global elite, the biggest power players at Davos, those running the biggest corporations and countries in the world are building great things in the interest of all, or conspiring behind closed doors, if they’re working altruistically or feeding self-interest or a combination of both, this book will give you some answers. It is readable and accessible, and full of tasty chunks of information and insight.
A little inane humor to brighten up your day… Jessica Hagy has this cute little blog called indexed. She uses index cards to illustrate little truisms, often with funny comments on venn diagrams. Here’s a funny one the relationship of status to money.
We all want to optimize our sites for Google. I mean other than a select few, that’s where most of our traffic comes from, so the more our site plays well with Google, the more users, readers, customers, and clients will find their way to us.
Most of the SEO material I’ve read has been pretty sparse, and unclear. But I’ve been following the topic over at my good Felix’s #comments blog, and I’m starting to get it. So you can too! Take a read: Google loves me, again!
If you haven’t been following the news on the topic, take a look over at this NY Times piece: Silicon Valley Start-Ups Awash in Dollars, Again. Personally I don’t think there is much hysteria this time around, sure there’s some, but not much. The industry is more mature now, and computers in general have lost their initial wow factor, so people are general more sober, and able to step back and see what is actually useful, can make money, is making money, or might well make money. That’s the root of investing smart.
Issue 44: Gaining Legs
Issue 43: On Prudence
Issue 42: On Efficiency
Issue 41: Roshomon Effect
Issue 40: Self Taught
Issue 39: Reputation Management
Issue 38: Are You Fast Failing
Issue 37: A Real Open Book
Issue 36: Rarity of Excellence
Issue 34: Hindsight Is Always 20/20
Issue 33: Market For Experts
Issue 32: Different Heritages
Archive: Past Issues
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Oracle9i + RAC on Linux/Firewire: click here
Migrating MySQL to Oracle: click here
MySQL Disaster Recovery: click here
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