A couple of years ago our fence was torn out of the ground by strong winds. At that time we needed it fixed fast, and at the lowest possible cost. We put a bid out on one of those “find a reputable trader” websites and sifted through 26 replies.
The price variation was almost unbelievable. The highest bid was a little over four times the lowest, with clusters of bids around the middle-to-low end.
After inviting a handful of the workmen to provide a site-inspection we were left with a range of offers. The highest bid was going to take down all of the old fence, lay concrete and use higher quality posts and panels. The middle priced options were similar, but some skipped the concrete or didn’t replace all the panels. The lowest price was almost a third of the top price and could have the work completed within 24 hours. They justified their lower price by taking a “pragmatic approach” to what needed replacing and from using “sensibly priced” materials.
We went for that option based on time and cost - despite warnings from some of the others that when you “buy cheap, buy twice”.
Well, last night we had a few robust gusts of wind which punched holes in our fences once again.
Cheap and cheerful?
This got me thinking about the old proverb that says “we’re not so rich as to buy cheap things” and my early career writing software for big telecom companies.
We spent a lot of time innovating, trying out new ideas and concepts and while our scope was relatively unconstrained, we had a golden rule - prototypes are prototypes, not production.
This meant we could take short-cuts and hack things together in a prototype proof-of-concept, but not one line of that code should make it through to the live product.
There is a time and place for rapid, half-baked code but the trick is having the foresight and discipline to know where cheap ‘n’ fast is not going to get you across the line quicker.
0.9999% Chance of Success
According to Gartner only 1 in 10,000 apps make it through to financial success. StartupGrind lists costs, timelines, out of date tech or poorly skilled developers (“bad tech”), quality assurance and design (“user unfriendliness”) as the top four software related reasons why most projects fail.
Those five reasons often boil down to a trifecta of cost, time and quality.
Only 1 in 10,000 apps make it through to financial success
— Gartner Research
The challenge for all software development is balancing the triangle - cutting costs or cutting corners will lead to lower quality, whereas increasing quality will cost time and cash.
So how do you set yourself up to be the 1 in 10,000 success story?
To hijack a marketing slogan from a well known beverage, you should look for development partners that are reassuringly expensive.
Reassuringly expensive doesn’t mean out-of-this-world insane prices, it means a price that has been carefully and honestly considered to factor in the expertise, design and technical quality that you will need to have the best odds of success.
It’s not always easy to find these partners because the app development market is so competitive. Many companies will simply low-ball prices with exaggerated feature sets to win the business, in the hope of recovering the loss later in the relationship.
We know this too well.
Experience is king.
Speak with any software company about this and you’ll discover most have tried this in their early days and most will share the same experience of how this can backfire. It goes a little like this:
- The first project starts with high expectations for requirements, features and delivery time, with at-cost or at-loss pricing.
- Features, quality or timescales are missed due to inflated and/or poorly managed expectations
- The software partner loses more cash than expected due to trying to fix the issues, and loses staff who burn out under the stress
- The client gets frustrated and suffers embarrassment with stakeholder
- Relationships breakdown
- In some cases both parties might agree to progress with the next phase, but then the cost expectation is still low and the delivery expectation is higher than before
- In most cases the relationship fails in the first or second attempt, costing all parties time, cash and stress.
Most companies that have tried this will have suffered through this with their early clients, learnt the hard lessons and moved on. Some development companies, though, still take this approach.
Investors know, too.
Many startups feel they need to get their apps to market fast and cheap to appease their investors. However, most experienced investors know that fast and cheap means repeat.
Spending a relatively small amount of budget on a design-led proof of concept could work out ok. Spending a bit more still on a cut-down minimal-viable-product (MVP) could still work out, but with a strong emphasis on the “minimal”.
Trying to get a fully-featured, high quality app that users love designed and developed in these price ranges will fail.
When that happens, you’ll be out looking for another software partner who will criticise the previous work and charge you a lot more. But this time, you’ll realise the dangers of cutting corners and be much more willing to pay more - if you still can.
In the end, good and bad design cost the same. Doing things properly might seem more expensive at the outset, but in the long run bad design or bad implementation will cost you in other ways - low uptake, high churn, poor usability or other reputational risks.
Alternatively, allocating a healthy budget towards user research, needs analysis and great user experience and product design could create a much greater impact. Investing your budget like this will provide the much-needed insights, concepts and validation that are much more likely to lead to app success than investing in disposable code.
If You Think Good Design is Expensive, You Should Look At The Cost of Bad Design
— Ralf Speth, ex-CEO of Jaguar
Being Reassuringly Expensive Takes Courage and Experience
Anyone can play the price-cutting game to win business, but it takes courage and conviction to knowingly bid higher than competitors for work.
This is what we do at ASquared.
Experience shows us the pitfalls of underpricing or over-complicating client work and we’re just not prepared to take anyone through that pain.
At ASquared we believe that you get what you pay for: Working with us you will pay for industry leading experience to deliver high quality software applications on spec, on time - and that’s precisely what you’ll get.