This post was written to help businesses understand what drives expenses in a web initiative to help inform their next budget or services request.
Scope is the extent of what a project will deliver, and the work or effort needed to produce it. It’s easy to communicate what the project should do or deliver for a business, but understanding what the effort entails is far from an exact science. In some cases, it may require a conversation with an agency, investigation of environments and source code, or even a Discovery to accurately understand the complexity and resulting costs of your project.
As you shape your next enterprise web development project, consider these in your budget request or request for proposals (RFP) process:
While a digital partner doesn’t directly influence software costs, how much you’ll need to customize it past what’s available out-of-the-box does. Consider what or if any readily-made templates, add-ons, and built-in integrations are available or if these need to be custom built. Get a feel for what your technology offers out-of-the-box and what a similar project implementation engagement in the platform’s ecosystem looks like.
There are two primary schools of thought: fixed and time and materials.
In an agency setting, resources are most commonly billed for their time, and how your project is billed influences how work is scoped. In a fixed bid setting, there is a single set price for the project regardless of the time spent and services provided. Fixed can be an effective choice in cases where requirements, specifications, and rates are highly predictable, and the project takes on a more linear shape. Although, fixed bids can become problematic when both parties don’t have a detailed agreement on what the project covers, subjecting vendors to feel like they may have given work away for free or clients feeling shorted by the work delivered.
Time and materials (T&M), on the other hand, bills the client for the total hours spent on a project and any expenses that may incur. The greatest advantages to T&M is the flexibility and opportunities to adjust requirements, change directions, revise or replace features, and incorporate greater research and testing of the final product. On the flip side, T&M can be a downfall in the scenario a vendor bills too many hours and exceeds budget before the project is complete.
Complexity, including requirements and functional specifications, directly influence scope. Typically, we think of this as the number of templates and page types we’ll need to build or develop, as well as any blocks or custom functionality. Making use of more versatile page types, block-driven pages, or pre-built templates is one way to get the most bang for your budget. Even better: writing out project requirements as functional specifications in a format that’s easy for the agency to consume should produce a hyper accurate estimate, as these can be estimated individually.
Most web projects will involve the need for some integration – whether it’s routing form data, displaying products, or enabling customer self-service. When data needs to pass between different systems, it often raises more questions than answers. The availability of APIs, connectors, or web services needs to be considered, as these may need to be built or purchased. Other considerations include if the agency needs to work with a third-party to develop the integration, or if these adjacent systems are still being implemented themselves. A good example in a classic e-commerce scenario would involve requiring the CMS to integrate with a PIM. If the PIM data feed isn’t constructed for consumption, requires your agency to work with the PIM provider to manipulate this structure, or the PIM itself is being implemented in conjunction with the web build, these would all be obvious risks.
Many organizations purchase digital services through an open or public bidding process, via a RFP or similar. Often, these documents which outline project requirements and scope are completed by the client and without vendor input.This can present incomplete information for the vendor, even through an open questions process, that can result in guesswork and missed expectations later in the project. A Discovery session is a common kickoff for most digital initiatives and is a great investment in project success. Discovery allows client and agency teams to vet requirements, set strategy, and ultimately mitigate risk while building consensus toward the solution.
The selected project management methodology has wide-ranging implications over how a project is structured and quoted. Consider, too, what internal methodologies your organization might prefer.
Two popular methodologies for agencies include waterfall and Agile methodologies. In waterfall projects, the project plan and requirements are defined early and the project takes a more linear shape. Work gets completed in steps or phases before the next can begin. While waterfall is popular and easier to manage budget against, it is also the most restraining when it comes to the ability to flex with changing project requirements.
An Agile methodology is more iterative in nature, but can inflate scope as it effectively reserves a full-time, cross-functional team over a fixed amount of time – or sprints. The advantage comes in freedom and flexibility to revisit features or absorb changes to requirements or scope.
There are many deliverables during the project lifecycle that may require the client’s feedback and signoff. These revision periods and their deadlines, if not minded, can extend deadlines and the life of a project. As a rule of thumb, the longer the timeline, the more expensive the project will become. From the client’s perspective, clearly understand your responsibilities and expectations going into any engagement.
Content, including client content entry or content migration, is an often overlooked risk in many web projects. Manual content entry requires clients to have all their ducks in a row, and if not, can extend or push a client launch. If this effort isn’t done manually, there are automated third-party services or custom scripts that can be written to aid this process. Be warned, though, this comes with additional cost. Automated services may also depend on the sites and platforms content is moving between, as well as the type and volume of content. The easier it is to map content between the existing and new solution will also help this process. The costs here can add up quickly, so make sure to account for this in your budget request and understand what options exist.
Digital agencies will rely on their experience and available data to estimate the solution, but there may still be many unknowns around a given project. In these situations, agencies will rely on assumptions to put conditions around the estimates they provide. Take the time to understand these to know what is/what is not included in scope. Engage with your agency to talk through these assumptions. It may just be that an agency requires a little more information before being able to accurately estimate the effort.
As we discussed, there can be a lot to consider when thinking through your next web initiative. While digital partners do their best to use their experience and data to shape client solutions, it is very much a collaborative effort. Engage in a conversation or conduct a Discovery to better understand the effort, hidden complexities, and resulting costs for your next web initiative.