One of the few mailing lists I’m on these days is the Lean Startup Circle – it’s a really smart crowd, and the signal to noise ratio tends to be very high. In response to someone’s question about doing projects fixed bid I decided to go into some detail about my thoughts on fixed bid projects:
What it boils down to is that a software development shop taking on a fixed bid project has a few options: spend ages spec’ing the project to the last detail, pad the project like crazy to handle scope creep, deny (or at least make incredibly difficult) change requests to control costs, or go out of business. I’ve never liked any of those options, which is why I’ve always done my consulting gigs T&M and won’t ever ask contract developers working on my startups to do fixed bid development.
You should definitely read the whole thing – I’m curious to see how the group responds, and would love to hear any thoughts you have in the comments.