Re: CFH and Late Payers

Subject: Re: CFH and Late Payers
From: Elna Tymes <Etymes -at- LTS -dot- com>
To: "TECHWR-L" <techwr-l -at- lists -dot- raycomm -dot- com>
Date: Fri, 04 Jan 2002 19:07:07 -0800

Martin Waxman wrote:

> Rule number 1 in contracting: If it ain't written in the contract, it ain't
> part of the deal.

No kidding! In reality, however, some clients try to add little things here and
there. When you're working on an hourly basis, you can allow that. On a fixed
price contract, however, that spells trouble. This one was fixed price.

> Rule number 2 in contracting: Have a clause which says that any change in
> scope from the original contract or agreement, is required in writing from
> the client, and requires a price and time re-negotiation.

Amen, brother! It was there. They ignored it, and because we were moving so fast
we were dealing with documents in different stages of development (mostly because
the software wasn't ready); the milestones had been written as if all docs would
meet all milestones at the same time. We pointed that out, but the only reasonable
resolution in the short time frame was to accept their assurance that either it
wouldn't happen again or that something unforeseeable had come up. So much for that

> Rule number 3 in contracting: Get client sign-off on statements of work and
> all milestones. Do not deliver the next phase or milestone until signoff.

Couldn't do that in this time frame. We got client signoff, and they agreed to pay
for each milestone (roughly one week apart for six weeks), but after signoff they
changed their minds about what should have been accomplished in that milestone and
told us there would be more - more info, more reviews, etc. Until the last two
weeks, when we were down to the wire and they were way behind. That's when new
material started being thrown at us.

> Rule number 4 in contracting: Avoid fixed price work. You will always lose
> your ass or have to bid so high to cover unforeseen events that you will
> lose the bid.

Which is why this was one of maybe three or four fixed price contracts we've done
in something like 30 years. Normally we avoid fixed price contracts like the
plague. We've just been reminded why.

Elna Tymes
Los Trancos Systems

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CFH and Late Payers: From: Martin Waxman

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