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What’s wrong with billable hours

daedtech.com

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Re: What’s wrong with billable hours

#131

Post by iainctduncan »

This article is amateur hour. And by that I mean "amateur" in the sense of "lacks the business experience to see past their own narrow experiences".

I work for a consultancy that works for some of the biggest investment funds in the world. We do some flat rate and we do some hourly. Sometimes hourly is exactly what the customer wants and is aligned with our interests. Sometimes it's not. I have also freelanced successfully with the same experience, and as a customer there are things I absolutely want hourly.

For example, discovery should always be hourly, or you screw it up by making discovery that leads to a no-go conclusion unlikely, even if no-go is the Right Thing. One of the best things I ever learned for consulting was how to do this - clients who have paid you a reasonable fee to discover that they are not ready to go ahead will be talking about your honestly and credibility to anyone who will listen. Managing when things should be hourly or not is a huge part of what builds credibility. Blanket statements about how one should never be trying to do hourly work reveal nothing but business ignorance.

Re: What’s wrong with billable hours

#132

Post by iainctduncan »

jedberg wrote: post #74
ChristopherM wrote: post #15

I charge by the hour and will never change. It forces the customer to focus on getting the requirements right instead of hand waving it like "oh yeah, that's just what I want" and then come back later "I didn't want that, what I meant was" repeat ad infinitum. You see they are paying for my time, not results. If they choose to waste it... doesn't matter to me, it's all billable just the same. I will do my best to ste…

More power to you, but I stopped charging by the hour a long time ago. I charge minimum by the day, and offer a discount if you buy a week. I still bill for my time, but I avoid haggling over how many hours something took, and it also saves me the trouble of tracking my hours. You book me for a day, you get me for the whole (at least) eight hour day, however you want to spend that time. You book me for the week, you…

Well that's still billing by the hour, it's just a bigger unit of measurement.

Re: What’s wrong with billable hours

#133

Post by jjk166 »

If the scope is fixed, you're selling a product. That product might be a one off, and it might be purely a service product, but it's still a thing to be sold at a price.

Generally consultants are not selling a product. They are hired to bring knowledge and experience to a team, to be there when needed, and to offer flexibility for which it would be time and cost prohibitive to develop an internal employee.

Re: What’s wrong with billable hours

#134

Post by HeyLaughingBoy »

mcguire wrote: post #65
fallat wrote: post #26

Earlier quoted context omitted.

> when the client has a specific, measurable problem that they don’t know how to fix (but you do) Then the client tells you that wasn't their problem in the first place. In the 10 years of contracting I've never done fixed rate for the reason the client never knows what they exactly want. It's not like installing a tiled floor or drop ceiling. Being a professional means a lot of things, but fixed rate contracting is…

In software, all problems are research and development problems. (If it wasn't, it would already be solved now.)

You would be amazed to know how many problems have been solved in software, but the client has no idea what the solution is or how to implement it if they did.

Re: What’s wrong with billable hours

#135

Post by tough »

tetha wrote: post #122
tough wrote: post #89

Earlier quoted context omitted.

Can't you just change the music in a silent update if the thing took off?

Sure you can. At 100k / month revenue, you have 100 currency / month or 1200 / year available for another artist, which may or may not include the risk of messing up the "feel of the SFX and music". Even at 10x that, that's a paltry sum, especially if identity is tied to it.

Honestly with it being such a small percentage you have to really hit it big to make such a dick move even worthwhile anyways

Re: What’s wrong with billable hours

#136

Post by swader999 »

tptacek wrote: post #120
swader999 wrote: post #119

Earlier quoted context omitted.

Hourly estimating takes too much time and it never gives useful numbers even with various padding schemes when estimating innovative sw development. Cookie cutter web sites or repetitive work that you've done for multiple clients is easy to fix bid but I don't do that sort of work. I just say this has a complexity of 1,3,5,8 or 'too big to say'. Each feature is a 1-15 minute conversation to get this number. Then they…

I don't know what we're arguing about. I don't like hourly estimating either, I'm just saying daily billing doesn't keep you from doing it.

Didn't feel like a debate, just trying to increase understanding on both sides. If you follow what I'm saying, I don't ever try to estimate hours anymore, I just use past data on complexity and then translate that to hours if ever required. There's very little time and stress, and effort for estimating. It's incredibly accurate over several features too and it is easy for stakeholders to decide cost vs value of each feature.

Re: What’s wrong with billable hours

#137

Post by hello_moto »

ChristopherM wrote: post #82
hello_moto wrote: post #23

Earlier quoted context omitted.

I see that your niche is in C/C++ world (with some Obj-C), low-level stuff. Mind if I ask how's the market and what kind of clients (companies?) that you worked with? If you don't feel comfortable sharing the list, would you be able to share some hints? Out of curiosity because my background in college is more towards System programming but life puts me as a full-stack and backend/cloud engineering. Gettin a bit tire…

Most of my clients tend to be Medical Device startups, but I did have a really long relationship with a major food manufacturer. While it makes sense for them to hire full time software engineers for some of the work, they always have a hard time finding device driver experts. Also they tend to attract less experienced engineers, so having me on board helps to manage and mentor their team. And I'm generally the one l…

Thanks for the insight.

I have 10+ years working experience mostly in Cloud (think Java/GoLang/Python, AWS, Kafka, DB backed system, with 4+ years in front-end JS).

Less experience in device-driver/OS development, system programming. I'm definitely interested to explore Linux/FreeBSD/Kernel or Device Driver type of work for fun. Would be great if I can make a living.

Would also love C++ experience, but prefer not writing AppServer bizlogic type if possible, I'd rather do it in another platform.

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