Jason Lautzenheiser

Bridge Building

Interesting post by Tatochip on contracting on a project with ill-defined proposals.  Despite my recent look into billing the project and not by the hour, this is a good example of situation where you should bill by the hour.  If the requirements are non-existent (or poorly defined) then of course I would bill by the hour... at least bill by the hour in gathering the requirements to be able to create a solid proposal.  A somewhat solid proposal is needed if for nothing else to provide protection for you and the client in what is expected and being paid for.  Changes that are outside that scope require modification.

Long Day

Well after a long day of sitting and waiting, I was just two people away from being selected to sit on this jury.  Although it was an interesting murder trial, it would have taken most of next week away from me and that would have been expensive for me.  So I'm back to work and on track for next week having only lost one day.

Consulting Fees (2)

Thanks for all the great comments to my last post.  Lots of insights despite the opinion being split.  I'm not sold one way or the other myself and need to do some more investigation and experimentation.  I've got a project that I'm quoting now that the client is actually expecting a per/project quote and could really care less how many hours I work or my hourly rate, he just wants an idea what the project is going to cost and the end result.  I've already built a trusting relationship with this client so I've got some leeway with what I do.  I believe I'll just quote the project (in plenty of detail) with the understanding that any added or significantly changed items may involve additional charges.  We'll see how it goes.

I can see where the larger projects may in some ways be easier to quantify as a set cost instead of trying to determine hours for it.  Smaller projects meanwhile may be easier to just quote the hours.  When you are dealing with a large project that may run into tens of thousands of dollars, a few hours one way or the other is really such a small portion of the project that it isn't noticed (example:  add 2 hours at $75/hr to a 200 hour project and that amounts to just 1% of the total project, whereas in an 8 hour project, those 2 hours are 25%....a big difference)

Jury Duty

Consulting Fees

I've been giving some thought recently to the way we charge consulting fees.  It seems fairly common in my area of the US to charge by the hour (or by the day).  But I've been thinking of the pros and cons of quoting by the project instead of by the hour.  Instead of giving a quote of x hours at y dollars per hour, I would quote xx dollars for the project.  Let me list some of my thoughts on that:

• Per hour billing is self-limiting.  Your growth is limited to a combination of the amount of hours in a week and your fee (which is limited by the local market).  Without hiring someone (or subcontracting) you can't increase your billable hours past what is physically possible in a week.
• Per hour billing doesn't give a percieved value of the results of the project (which is what the client is interested in), but only the value of your time (which the client really doesn't care about).  A client's percieved result value may be six figures, but that may take a years worth of hours to meet when in reality it's only a 3 month project.

Let me share an example to compare.

Scenario 1 - Per-Diem Billing
Project is quoted at 100 hours at the rate of $75/hr.  This comes to $7500

Scenario 2 - Per-project billing
The process that your project is intended to replace (or enhance, improve, whatever) is estimate to cost $75,000 a year in time and material to the client and is a place where error can creep in which raises that cost.  The client knows the process needs changed and agrees with your proposed changes.  A successful project will allow the client to reduce the cost of this process to $35,000 a year and minimize a chance for human error.  This is a savings of $40,000 a year just in the cost to the business.  Given the market in your area and your relationship with the client, you could potential set your quote to be anywhere from $10,000 to $40,000 or so and this will pay for itself in the first year in savings to the client. 

This example may be convoluted (and admittedly not completely thought through and thorough), but unless I'm missing something, I see the potential there to increase the fees we charge and still have a client that is happy. 

I need to think through this further before any changes are made in the way I set my fees (I currently have been billing per hour as do most of my associates), but does this seem reasonable to anyone?  Are there any out there that can make valid arguments contrary to what I've stated.  I'm interested in hearing both sides.

Modem Uses

I live in a rural area of Ohio where broadband has just recently been made available.  So this past summer I finally had my cable installed and am running fast now.  But I've got this nice internal modem in my machine that is just sitting there.  I'm trying to think of some good utilities for it.  I don't make a ton of phone calls from my desk so an auto-dialer type app doesn't seem to useful.  Possibly some sort of app that could detect waiting voice-mail and check it.  Any ideas for any apps?

I'm really looking for something that I can develop myself for educational purposes so any good articles or sites on .NET / C# development in this area would be appreciated as well.

Back Finally

Hopefully I'll be back posting more now...my entire family is getting over colds, flu, bronchitis, and all kinds of fun nasty things that we enjoyed during the Thanksgiving break.  Anyways, wish us health and here's hoping I can catch up with some work.