You put out a Request for Proposal and the software development bids are all over the place. Short of crying “Whyyyyy?” into the ether, you need tools to help understand why bids are so varied and what you can do to vet prospects. And if you haven’t submitted an RFP yet, keep reading to learn what you can do to get more accurate bids.

Reasons Software Bids Vary

If bids are all over the place, it can be challenging to truly determine the best fit for your project. From unknowns and unrealistic expectations to unvetted firms whose offers are too good to be true, there’s a lot of reasons why software development bids appear all over the place. We’ll cover those and dig into best practices for vetting a software company in this article.

Lack of Clarity

Knowing exactly what you want and having a roadmap to building will help you get a more accurate estimate upfront. But how would you, a non-software developer, know this? Often startup founders and innovation teams within organizations have great ideas and a general concept for how software might be developed, but they – understandable – lack the technical knowledge to give enough details to get accurate bids from software developers.

Naturally, a more detailed plan will lead to a more accurate bid – but you shouldn’t have to be a software developer to be able to hire a software development firm. At ENO8, we don’t believe it’s your job to be the expert, yet that lack of expertise makes the bidding process a nightmare and can result in costly reworks down the road. At the end of this blog, we’ll discuss what you can do to gain the clarity you need to ensure submitted bids are specific and aligned with how the actual build process will play out.

Uncertainty = Padding

When the project isn’t clearly defined, firms have to account for the cost of unknown variables. Sometimes these unknowns are not only the result of an unclear RFP but the inexperience of the development team. Either way, uncertainty or lack of clarity can be costly, and most firms respond to this by heavily padding their bid to try to cover for unexpected reroutes or change orders in the future. While this is understandable, it’s also an indicator of lack of experience (on one or both sides of the business relationship), and it doesn’t have to happen.

Fixed Software Development Bids

When a project is new for a developer, it can be hard to provide an accurate estimate as they don’t know the unknown.

It’s easier for developers to estimate simple tasks they complete regularly as they have a commonly used fixed bid. Vetting firms by their previously created work to find an example comparable to what you want may help you gain a clearer perspective on the project, but it doesn’t apply if you’re seeking to create truly innovative software.

Generally, fixed bids result in one of two things: stamped out software that follows a pre-existing formula but doesn’t chart any new courses or innovative software that only results from time-consuming and expensive reworks.

Things to Vet For

The importance of thoroughly vetting proposals and the companies that submitted them is critical. Here are some things to look out for:

Make Sure You’ll Have a Dedicated Team

Without a dedicated team, your project may be lost in the shuffle especially if you’re working with a larger dev shop. Furthermore, if team members are coming in and out, important details can be lost in the shuffle, and you can find yourself explaining things more than once. This is inefficient and unprofessional, but it does happen. Clarify ahead of time that you’ll have a dedicated team on your project. Furthermore, is this team diverse? Do team members have different skill sets? For example, no amount of engineers can overcome the poor UX/UI that will result without a designer.

Forest and the Trees

During the stages of project planning, it’s important to keep your eye on the end goal and the detailed features. Unfortunately, many inexperienced software developers (and even some veterans) focus more on the features and how to construct those, rather than on the post-launch success and user adoption of the product.

Businesses should either have an in-house Product Manager or hire a development firm who can supply one. Otherwise, software projects get lost in the “can’t see the forest for the trees” failure cycle. Focus becomes directed at features and how to execute them versus answering questions like, “Do our users even care about this feature?”

If you don’t have a Product Manager, then verify that the development team can provide one who is going to spend time to deeply understand your organization’s goals, end users, and industry.

Due Diligence

Do your due diligence when it comes to vetting a software developer in whom you’ll invest tens or even hundreds of thousands of dollars. Ask if you can speak to previous and current clients. Read up on them in the news and in any reviews you can find. Ask for a portfolio and ask to be shown work samples that are similar to what you’re looking for. It does no good if they are extremely skilled at

Interview

Ask tough questions of potential software development partners. Find out if they have ever had to do major reworks on a project and dig into why that happened and what they learned from it. If you get to interview previous clients, ask if the firm only builds what they’re told to build and how they react when asked to innovate or get creative. Building only what is on the request for proposal may keep a budget on track, but you may be left with a product that merely works rather than one your customers will love.

Don’t Go Dollar Store

Since industry experience and expertise vary greatly, a low price doesn’t always make for the smart solution. As with most complex services, you get what you pay for – until you don’t. That is, a much lower price is almost always connected to a lower quality of work. Not ideal, as consumers’ standards for software are higher than ever. As price goes up, quality of work can be expected to improve until it hits a ceiling when the increase in price no longer correlates as strongly with an increase in value. That doesn’t mean you just pick someone from the middle of the pack, because you may actually need the experience and high-priced, highly skilled professionals they employ. Do your best to balance value for money and superior quality of work.

Clarity is the Key

Without a clear shared perspective, a giant gap can be created between what you think you want for your project and how the developer wants to execute the plan. The mass flux in price that’s caused by this gap leaves you with software development bids across the spectrum.

Clarity is key with a request for proposal as it provides a guiding light for developers in finding the best solution for your project.

Over years of being a true partner to our clients, we developed specific and research-driven planning processes and utilized them to set a clear course prior to execution, saving our clients time, money and hassle during the development segment. We honed these processes into workshops that enable us to gain clarity on a variety of critical points, including but not limited to:

  • Who the end users are, what they want/need, how we can solve their problems
  • The users’ specific experience with the software
  • What features users want and will actually use
  • Your differentiator
  • The technology required to bring the idea to fruition
  • How much it will cost to build this
  • How long it will take to build this

Other than the last two, these are the questions you need to be able to answer in your RFP if you want an accurate bid. No matter how talented the development company, without that information – and more – their bid is merely their best guess.

Innovation Lab First, Accurate Bids Follow

The Innovation Lab helps you understand your project inside and out. You’ll have clarified objectives and even an insightful prototype to show software development firms.

Here at ENO8, our Innovation Lab is a resource at your disposal that will ensure you gain the necessary information to shop your software project quickly, easily discover the partner that can take you to the finish line, and launch a successful digital product. Contact us to learn if it’s a fit for you.



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Jeff Francis

Jeff Francis is a veteran entrepreneur and co-founder of Dallas-based digital product studio ENO8. Jeff and his business partner, Rishi Khanna, created ENO8 to empower companies of all sizes to design, develop and deliver innovative, impactful digital products. With more than 18 years working with early-stage startups, Jeff has a passion for creating and growing new businesses from the ground up, and has honed a unique ability to assist companies with aligning their technology product initiatives with real business outcomes.

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