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What is Value proposition?

In business there is a famous old saying "Fast, Good, Cheap - pick any two." Which refers to the trade-off everyone has to make when taking on a new project.

In our business we are very aware of these aspects of the value proposition so we try to provide the best solutions we can to our customers.

Price

One of the first things you need to learn if you are going to be successful in business is that there is a difference between price and cost. Often cheaper items end up being more expensive in the long run. Nowhere is this as clear as it is in labor. For example, let us suppose that you need a task completed. You have two people that can complete this task. The first charges $20/hr - it takes them 4 hours. The second charges $100/hr - it takes them 30 minutes. The total dollars you pay are $80 for the first and $50 for the second - so even though the second person costs more per hour - the end of day cost to get the job done is noticeably less.

In our business we seek to charge a competitive rate for the general class of service offered however we strive to go above and beyond on our delivery. This means you should be able to get the job done for the same price at another provider however you should have a very hard time matching the service and quality levels.

The second component we have seen is hidden costs not disclosed. Some of these can be known ahead of time - while others can only be estimated. Take for example maintenance. Every project will need some maintenance. The quality of the project can have a huge impact on how expensive that maintenance proves to be.

We believe in treating our customers like we would treat ourselves - our goal is to disclose anything that has a direct business ramification. We always assume that we will be the provider selected to maintain the project. Because of this we will strive to always implement the pragmatic best solution. Why pragmatic? because we are aware that no small business has a budget like NASA. We will provide the best solution we can within your budgetary constraints.

The third component of price has to do with efficiency. Back to our two possible employees. Let us suppose that one has to redo work 5% of the time - while the other has to redo work 40% of the time - this translates directly into costs for you as a business person - not only in re-paying for work you though was already done - but also in delayed deliverables which often hold up other parts of their related projects.

There are two ways we deal with this in our business. First is how we bill. The technology industry more than probably any other has a steep learning curve. It is normal for half of what we know to become outdated every year. In working for customers - if we need to learn something new to produce a deliverable we estimate if that knowledge is specific to the customer or if we will be able to use it again with other customers. If it is generally usable knowledge then we cover the cost of learning - only if the knowledge is unique to the specific customer do we bill for study time.

Second is how we structure our billing. Most shops we work with run 8 hour days - and bill customers for all 8. We know that software development and bug fixing is a highly creative task. Research has shown that no one can do more than 4 hours of highly creative work in a day. Instead of billing for all 8 hours each day we bill for 3-5 hours per day. Once the creative energy is exhausted for the day we apply ourselves to education and maintenance tasks that are not specifically creative in nature (and usually non-billable).

Time

How soon do you need the project completed? A higher base skill level can decrease the amount of time needed to deliver the solution. A bigger team may help - however scale is never linear (4 people don't finish the project 4x as fast as 1 person).

To meet this challenge we keep team sizes small - which reduces the need for long drawn out (and very inefficient) meetings. All projects have a responsible party - they can delegate - but they are responsible for the final deliverable.

How often do you tweak and adjust the project - deliverables should be frequent and incremental so that the solution can be made to evolve as the need evolves.

We usually manage to get our first demo/incremental deliverable up within a week of starting a new project - additional deliverables are usually provided either daily or weekly depending on the project scope. It is our earnest belief that continuously involving the customer in the process is the only way to properly meet the true target (this is because, in our experience, the customer doesn't fully realize what they want at the start).

How much time will be spent fixing problems because the solution was either rushed or completed by someone who didn't fully know what they were doing?

Here again - because we assume that you will select us to perform maintenance - and because maintenance is not nearly as fun as creation - we seek to create the best products we know how - we try to minimize the maintenance burden in any way we know how.

Every relationship takes time - time to learn how the other person thinks - what they want - what they are not saying. This is a general expense of time (the only resource with a hard limit) - every time your business grows to the point you need to find a new solution provider - you lose another chunk of time - searching for - qualifying - and training in the new provider. There is also a time investment for the provider as they learn to fit into your workflow.

Because of the investment required to create a new trust relationship - we value existing customers more than potential new customers. We value our employees even more, which does benefit you because none of them are dissatisfied and all of them share our cultural values (relationships first). When we work with you, our goal is to create a life-long partnership that benefits both you and us.

Quality

There are several aspects of the quality of the deliverable. First is moral integrity - if you don't trust the provider - then you have to supervise everything they do - for a lot of software development it is your business process at the mercy of their implementation.

This area is harder to prove than most of the others - you really have to meet us to understand who we are and how we are trustworthy. Most of our staff and outsourcers are Christians - people who believe in God and also in hell.

Second is technical integrity - do they really know what they are doing? Are they future aware? A poor technical solution will need to be replaced - and frequently that will mean from scratch.

This is an area close to our heart. We spend at least 30% of each day improving skills and knowledge so that we can provide better solutions to our customers. Our Business and Technical library contains over two thousand volumes (Our Library - well most of it) that we use for ongoing studies.

Implementation - will the chosen solution fully meet your needs or is it a poor fit (usually an indicator of poor technical competence on the part of the solution provider).

This is why initial consulting is so important - and also why we insist on getting a basic feel for your business plan. If we understand where you are - and where you are going - we can make sure that our recommended solutions are most likely to be able to scale with you as you grow.

What is the long term maintenance profile - how much work is it going to take to keep it running? To make necessary changes?

We are planning to keep working for you for the indefinite future. Given the option we would rather help you implement new solutions rather than keep existing ones running. We seek to minimize ongoing maintenance wherever we can in hopes of improving your business efficiency and ability to evolve to meet your own market requirements.

So there you have it, our take on the three points of the value triangle - Price, Time and Quality.

If you like what you've read and it matches up with your philosophy of business get in touch - we are always looking for compatible people to work with.


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