Cooperation Models Overview: Dedicated Team, Fixed Price, Time & Material

Exposing upsides and downsides of cooperating with an external service provider using various business models: fixed price, time and material, and dedicated team
Dec 2, 2016
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Most companies desire to have a long-term partnership with their customers. However, sometimes the process of ensuring trustworthy relationships can cause difficulties. Choosing an appropriate cooperation model will help both sides to reduce possible risks and derive maximum benefits from the partnership. Depending on project needs, scope, and capacity a different business model will be suitable.

Cooperation model (or business model) is a legitimate agreement between a service provider and a customer. Both parties should complete necessary documentation in order to protect their rights and ensure comfort partnership. These documents define work conditions, iteration methods, terms and conditions, deadlines, payment, liability of the parties, etc.

Depending on how your project is organized and what your requirements are, Program-Ace offers transparent and efficient cooperation models for better results: Time and Materials, Fixed price, and Dedicated team.

Time and Materials (T&M)

Time and materials model

Brief Summary

When specifications are unclear, and project scope is not precisely defined or needs to be developed throughout the project, Program-Ace suggests using our Time & Materials cooperation model. It will be a perfect match for a long-term or part-time project with no strings attached or undefined specifications, deliverables, or budget. As the final price and workloads change, T&M offers flexible working conditions for both parties. This cooperation model provides the resilience of modifying requirements, amount of developers, workload, and optimizing cost at the same time.

Commonly Used:

  • for medium and large projects with many internal tasks;
  • for projects with frequently changing demands;
  • when the development team’s workloads and deadlines are not specified.

Gives Customer a Freedom to:

  • Adjust evolving requirements anytime during the project;
  • Control the project throughout the iterations;
  • Pay only according to the time spent;
  • Manage or change developers’ capacity.

Dedicated Team (DT)

Dedicated Team model

Brief Summary

With a wide spectrum of services provided from virtual reality and augmented reality development and gaming solutions to training & simulations and web development, Program-Ace is a company worth attention. For that reason, one of the most prominent business models is Dedicated Team. This model assumes that a team of professionals provided by an R&D company will work remotely on your project. In other words, developers effortlessly join an existing team, adopts customer company’s culture, methodologies, and best practices.

The company together with the customer selects experts to work on a specific project. Besides, the service provider organization provides employees with all the necessary working conditions and protection. In return, the customer pays an agreed amount of money that includes a monthly salary for every developer. Also, the client has full control over team’s capacity, project management, working hours, and meeting deadlines.

Commonly Used:

  • for any project with unclear deadlines and/or changeable requirements;
  • when it is profitable to work with a particular professional or professionals;
  • when the budget is tight or not approved;
  • when it is necessary to outsource only a part of a project.

Advantageous Because:

  • The client exercises control over team’s workload and performance;
  • Only high-skilled and trained developers are working in a team;
  • Your dedicated team can be easily expanded or downsized at any time if necessary.

Fixed Price (FP)

Fixed price model

Brief Summary

This model is preferable for small and medium projects with strict and well-documented requirements. The client gives the service provider with all main details like project scope, working period, deadlines for each stage of a project, established budget, demands to the final product and all project-connected details. These comprehensive set of specifications cannot be changed during the duration of the project. Program-Ace carefully explores all project details, estimates its scope and complexity, and provides a proposal with delivery schedule and total cost.

Fixed price engagement model does not require any additional control from the customer; a service provider is responsible for the project management.

Commonly Used:

  • for a long-term project with stable requirements that are not expected to be changed;
  • for cooperation when both company and client are aware of the project details, required skills, and capacities;
  • for fixed rate hours, deadlines, and payment;
  • for small and midsize projects.

Flawlessly Works Because:

  • Does not require additional spending;
  • Gives the customer freedom to spend his/her valuable time on important tasks, instead of controlling the project;
  • Provides risk-free cooperation.

What Program-Ace Stands to Offer

Program-Ace, as an R&D company with more than two decades’ experience, provides custom software development and gamification services in virtual reality, augmented reality, HoloLens development, mobile solutions, training & simulations, etc. Our competent team employs the cooperation models mentioned above to offer a wide range of services. Contact our representative to discuss the best option for your project.

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