In estimating software development costs, you are in fact defining what your end product will be. Which features are necessary to the core functionalities of the software and those can cause unnecessary costs at certain stages of the product lifecycle? The prioritized features will be driven first but closely followed by budgetary factors.
A detailed software development plan can provide knowledge and expertise in understanding costs and how best to avoid expensive maintenance costs in the future. And if the client is able to clearly define what they want, a reliable and experienced partner or team will be able to help outline the cost of making it a reality.
The software development process is changeable by nature even with clearly defined goals, the best path to achieve those goals often emerges during the course of development. If the project is a long-term one, it will require an iterative approach. Identified priorities allow engineers to establish the milestones towards the end goal. With a software development battle raging across devices and platforms, the ability for software to be fixed on the go, evolving throughout its lifecycle is an absolute necessity.
By breaking down the big project into small deliverables, each milestone can be treated as a short fixed-priced project. This provides transparency and a great degree of accountability to the software development costs. The customer and project managers are able to keep a tight leash on expenditure by eliminating any processes that do not contribute to the goals. The number of developers and working time is set, but their scope is not, it will be dictated by the evolution of the product.
(An example of breaking down website development costs. – Source: LaunchAStartup)
Over-estimation and misrepresentation are an inherent danger when dealing in any market for service providers. Just as you may fear your mechanic is taking you for a ride over the ‘new’ gearbox he is building you, it is not pleasant to overpay or feel that you didn’t get what you wanted. It is important to choose a reputable firm, so you can rest assured the desired results with a qualified development team at the best cost.
The unpredictability of most projects stems from many tasks not being as straightforward as first thought, which ends up costing time and money. If the project management team isn’t able to accurately predict software development cost and duration, there will be an overrun on both fronts and these are finite resources. If cost and time become variables, it becomes very difficult to make good strategic business decisions. With developers working at different speeds and project managers of varying degrees of risk aversion, if a team is not constructed and managed efficiently, important dates will be missed and extra funds ruefully committed.
It is impossible to know everything at the outset and much more realistic to cultivate an understanding through data and feedback going back and forth between the development team and the customer. This means the tasks with the biggest impact on the core function will be prioritized throughout the entire lifecycle and the software will be responsive and amenable enough to updates and changes to remain in use. This adaptable approach means that the product can be launched incrementally, with future software development costs and features continually being re-evaluated and tweaked.
These fixed price packages also often allow for termination if the customer feels that the project is no longer justified or indeed that it is has attained enough functionality for its purposes. Realistically a collaborative, long-term approach is required to ensure that the customer is able to be delivered the quality product that they actually want and that it is maintained with adequate support and ongoing development. This is in both the vendor and customer’s best interests.
When there are trust and confidence between the customer and the development team, people are empowered to make the right decisions for the right reasons and enabled to give accurate forecasts. This is equally true for start-ups as it is multi-national companies, the right decision makers have to be in place at every milestone in order to operate at optimal efficiency both financially and in terms of the best path to take to achieve the team goals.
(A customized & scalable software development team at fram^.)
The key to accurate software development cost estimation is to keep it grounded in reality with stakeholders working closely together. Applying expert opinion and close team collaboration with the customer enhances and develops everyone’s understanding of the project and what it will entail.
A cost estimate is a proposal and it needs to answer what a product is going to be when it will launch and what its ongoing business strategy be. Trust and co-operation are essential, the vendor needs to be responsive to the customer’s needs and also capable of producing the desired results.
Customers will also have to understand that software development is an adaptive business and place their trust in the team and their estimations. Greater levels of accuracy come from having the right team in place, with a strong managerial infrastructure capable of maintaining standards, writing clear requirements and overseeing the entire successful life span of the software.