Re: Estimating Projects

[Andrew Plato <intrepid_es -at- yahoo -dot- com>]

It's not a fairytale Elna.  

"Elna Tymes" wrote in message ...
> 
> First off, there IS no "industry standard" for consultants.  Any attempt to
say so
> is simply hype.  

Oh - but isn't FrameMaker an "industry standard!"

Sure there are industry standards.  There are general practices by service
firms. You do work, you bill for that work. All service organizations work this
way.  How many *good* auto mechanics do you know who take your car apart, then
fold their arms and ask for a partial payment? (Please note my emphasis on
*good*.)  *Good* places give you an estimate, do the work, explain the results
and charge you.  Good places also call you and tell you if it will cost more
than they expected.  You don't pay until they deliver your working car. 

Consultants should work the same way. Estimate, work, bill, get paid.  

If you can't trust your clients then why should they trust you? 

> It is more common for writers and clients to agree to a
> time-and-materials basis, but some clients prefer a flat fee basis because
knowing
> how much they're getting in for makes them more comfortable.  Unfortunately,
as
> those of us who have tried this route and gotten burned have learned, there
are
> always problems that change the bases for those estimates: feature creep,
> additional reviews, "Oh s___, I forgot to tell you," etc.

This is why you write up a detailed estimate that says "here, this is what I
will do and what it will cost."  That way, 3 months later when they are whining
that you didn't do something, you have the signed estimate to go back to as a
guide. 
 
> While YOU might send a writer packing, I have been in situations, as
principal,
> where submitting a schedule and outline and waiting for a check makes a great
deal
> of common sense.  Unlike Andrew's fairytale marketplace, the real world
contains
> good clients and bad, cheats and scam artists as well as struggling startups,
and
> big clients with dubious financial practices (ask anyone about Oracle's
well-known
> practice of 45-day payables for contractors, IF they manage to find your
> paperwork).  I have a responsibility to my employees and subcontractors to
pay them

I have worked with Oracle. Yes, their AR is messy. But they pay. You just have
to be willing to maintain the paperwork and invoice them properly. 

Again, this is where many independents get into trouble. They don't want to
maintain books and deal with AR, so they do it sloppy and then blame the
client. All companies have different AR/AP rules. You just have to be willing
to spend the time to get to know the right people and handle the paperwork.  99
times out of 100 I have solved all billing problems with a simple phone call to
a VP or director. 

> on time.  I can't do that if the client doesn't keep their end of the
bargain.  If
> the agreement between writer and client is that the client makes a staged
payment
> in return for the outline and schedule, it makes sense for the writer to at
least
> question things if the client doesn't pay on time.

If you invoice bi-monthly, you'll work about 45 days before being paid. 
Honestly, if you can't stomach 45 - 60 days without pay - go get a full time
job or work through an agency.  

> Unfortunately, most writing contracts exceed the amount allowed in Small
Claims
> Court (in California, that's $5000), so suing a client who stiffs you can
involve
> legal fees and delays of up to two or three years.  Nobody I know in this
business
> has the wherewithal to take a client to court and wait for three years to
collect
> on a $20,000 contract.

Sure,  suing is tough. But for $20,000 its worth it.  Most suits do not go to
court.  If you have a good contract, an open line of communication with the
client, and a decent paper trail you will be okay.  

All independents should have the wherewithal to take a client to court for
$20,000.  If you are not willing to defend your company and abilities - why are
you in business?  If people stiff you, you have to be prepared to fight for
what is fairly owed you.

This is a huge problem for many independents. They want the money, freedom, and
flexibility of independent consulting but are not willing to swallow the
business realities of being a corporation.  As the man says, "if you can't
stand the heat, get out of the kitchen."  

> And in most situations, if both sides do what they've signed up to do, when
it was
> supposed to happen, there are no problems. However the incidence of bad
apples in
> this barrel we call a marketplace is sufficiently high that reasonable
prudence is
> better than constantly relying on the Pollyannish hope that all clients will
do
> what they agreed to do.  Perhaps in Andrew's fairytale marketplace in Oregon
all
> clients pay their bills and keep their agreements.  In the real world in
California

Most people will honor their end of the bargain if they know what is expected
and everything is documented properly.  Obsessing and assuming the worst is
just going to get you ignored.  In business, you cover your butt and do your
job.  Most of the time, things work out alright if you're diligent and
professional about it.

There is also the aspect of picking your clients.  I have people call me all
the time wanting my services.  When I meet them, it becomes instantly apparent
they do not have the means to pay for my work.  So I walk away from the deal.  

> and other parts of the US, some startups go bellyup with no notice, some
shady
> engineering managers think they can get something for little or nothing, and
some
> doc managers get crosswise with their finance departments, and the
contractors
> suffer.

Elna, its really easy to see the contracting glass as half-empty when things
have not gone your way. Contracting is a two way, heavily traveled street.  For
every shady engineering manager there are totally incompetent contractors. 
Blame in this case goes both directions.

In my experience, if you are professional, thorough, and honest, you will get
what you want most of the time.  Yes, some places are scum. Yet who is really
to blame?  The scummy manager or the contractor who did not cover his/her butt
when time came to get paid?  

Andrew Plato 

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