We're ready to take full responsibility and 100% of software delivery risks.
Fixed price contract is a win-win model of cooperation that allows to establish scope and responsibility of the parties as well as specify the set of business metrics such as KPIs or ROI. Once the software development team is committed, business metrics are confirmed and acceptance criterias are negotiated we can declare real shared vision and goals.
Managed delivery model of cooperation is the most efficient way to build the long-term relationships between Enterprise and managed software development teams. External software development team and Enterprise are sharing the business risks while utilizing the advantages of Iterative CMMI and Agile Scrum methodologies. Efficiency means that Enterprise pays for declared Statement of Works (SOW) or Iteration Backlog in case of deliverables' comply with the acceptance criteria, clarified and agreed before (for example, on iteration planning meeting). Otherwise, software development team is obligated to fix all inconsistencies at their own expense and before invoicing as it is noted in Service Level Agreement (SLA).
Thereby, we keep serving business with flexibility and agility to manage the project scope or software product master backlog in accordance to market demands. It is right cooperation model for software developers to stay result-oriented and cost-effective.
Herein, intention of long-term relationships opens strategic opportunities for cooperation to evolve into Dedicated Software Development Center (DDC), offshore (Offshore Development Center, ODC) or near-shore.
On the early stage DDC looks like software development team that is managed by dedicated Project Manager or Scrum master. Highly-developed and mature Dedicated Development Center is driven by Enterprise's corporate Competency Model and KPIs as well as SPI/CPI metrics.
The lack of risk-sharing capabilities is the main weak point of the Time and Material contracts between software development team and Enterprise. Software development teams may lose their commitments to be result-oriented if all set of business-risks belongs to the Enterprise. That is why we suggest to use T&M contracts for short-term team extension driven by SPI and CPI metrics.