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27 Feb

Why is fixed price engagement model for product development not the right approach?

By: Sayed N

Product development and design varies from business to business based on the nature of requirement. Everyday, new processes, techniques are evolved with the presence of highly innovative techies across the globe. Hence a pre determined model cannot be followed in every business and it is essential to consider every aspect both fixed and variant before getting into product development.

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Agility is a key factor to be taken into consideration apart from the other important aspects for product development. Thus a fixed price engagement model may not work out every time and could turn out to be a blunder for product development. Let us find out more reasons as to why we should not go for the fixed price engagement model.

Rise in new product or process development

Everyday some kind of new product or process is developed and adapting the right method may act as a catalyst in your product development and help you in achieving more than what you had expected. However if the right and suitable process is not adapted, the result of product development may also slow down or become an unsuccessful one. Hence, it is not possible to predict a fixed price for the product development project.

Maintaining the standard quality

Many a time, product development may just become experimental. It is only through several permutation and combination that one can be assertive of the usage of the right resource. For a proficient product development, high quality software platform and capabilities has to be incorporated which might not come into the affordable range of many companies or enterprises. Usage of lower quality softwares may lead to poor results and the entire project may be goofed up.

Clarity of Ideas

There is a good chance that the developer does not get the right idea of the client which may be a miscommunication from the client’s end. In such cases both the developer and the client suffers which also results in delay of the product development project. Making changes to the framework every now and then is indeed a task and the effort put in sometimes may go wrong. Hence a pre determined rate may not work out in these cases.

Compromise in quality

Many companies look out for rates of product development at the first place or decide a budget for the same. When the developer is told to stick to the budget by the client there are chances of compromise in quality which may further result in not getting the desired product by the client. Ultimately, what happens is, the client has to look out for another product development right from the scratch due to incompetent software platforms used due to budget constraints.

What is the right model for product development?

Bigger firms and enterprises, these days, opt for time and material engagement model. This kind of an approach is not based on the price but is focused more on the dedicated resources engagement model. There is a fixed source for the resources used in the project and this is considered as the base. When the right resources are used with proper implementation time is also saved. The end product with optimized features would definitely help solve the enterprise issues.

InnoMind Technologies with its expert team focuses on understanding the business case well so that the right resources could be chosen and implemented to achieve the desired result. Evolving processes are planned and adapted for each product ensuring high end quality at an affordable rate. A global design with advanced features enables you to stay ahead in the competitive environment. We understand the need of the clients and provide an array of services such as IT consulting, outsourced product development services, maintenance and support services, offshore software enhancement, independent software product testing services, dedicated offshore and onshore development teams and many more. Our expert team is ready to study your business case and provide you with services starting from idea validation to UI/UX, architecture, Code development, QA testing and ongoing maintenance,get in touch for consultancy and solutions.

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about the author
Sayed N

A renowned Digital Growth Strategist, Digital Marketing Consultant, Speaker and Digital Marketing coach with over 10 years of progressive experience. He has been a trusted advisor to businesses from the SMB level all the way up to large enterprises and Fortune 500 companies. He played a pivotal role in the growth and advancement of InnoMind Technologies as diversified business group which dealt with professional education, Digital Marketing franchises, and full service Digital Agency serving clients across the globe. He has an MBA in Marketing & Finance from MDS University and Certified Google Adwords partner. He also works closely with various women empowerment agencies globally to promote rural women entrepreneurship and enable them to GO Digital.