Which Engagement Model Is Best For Your Software Project? A Cheat Sheet
The chase towards a cost-efficient approach to software development that could benefit one’s business through the prism of cost and time rationally comes as a challenge to companies seeking to launch the desired product. Which software engagement model will make the right cut is the most concerned question businesses are facing today.
The company’s bet on choosing engagement model has multiple legs: a best fit pricing model, all goals aligned rationally, and a project that gets completed in a timely fashion which further depends on the hindsight of various factors such as company’s experience with other clients, same type of domains covered by them, the amount of time taken for project completion etc.
While these factors certainly depend on the technological aspects, complexities involved, and type of commitments with the client, the company must precisely regard these points as well. On the behalf of the type of engagement models manifested for businesses are- Time and Material, Fixed Price, and Dedicated Team Model. Here’s a detailed study of it:
1. Time and Material (T&M) Engagement Model – The T&M model works best for businesses whose requirements are unclear or are subject to be changed quite often. Here T&M model also plays a greater role when the business demands flexible and agile project execution. Well suited for medium to large projects in this model the business itself carries the related risks of scope, quality of deliverables and project management.
Here the software development company assigns a dedicated team to the customer and the actual time spent in the project development is charged. Generally the service providers are paid on account of the number of developer’s hours engaged in the project or writing the code.
Pros of Choosing Time and Material Model:
• Well adapted to changes driven project;
• Full control on what buyer wants to get done.
2. Fixed Price Model – The fixed price model is ideal for businesses whose requirements are well defined, plans are well set, and there are almost little chances of changes. The fixed price model also works wonder when buyers require quick turnaround time to project completion. Unlike time and material model, here the service provider and the customer both carry some scope-related risk. But as stated in the agreement changes to the project are subject to change in price.
Pros of Choosing Fixed Price Model:
• A defined scope and fixed budget;
• No potential disagreements;
• No inflated expenses report at the end.
3. Dedicated Team Model – Dedicated team model is a virtual extension of client’s in-house development team where the client and outsource provider mutually agree on the workload and project requirements for the specified time period and the service provider or the outsource company provides IT professionals that befit clients demands and fully focus on projects for one company at a time.
This model is well suited for long-term projects, where requirements are unclear and scope of the project keeps changing frequently.
Pros of Choosing Dedicated Team Model:
• Complete control over the selection and management of dedicated team members;
• Working with a dedicated team gives the team members profound knowledge of client’s expectations and understanding;
• An agile approach, fully predictable costs, and budget control.