Pay by the job, or pay as you go?

I was intrigued by the promotion, “we charge by the job…not the hour” (and I admit the kitchen magnet advertisement glued to my phone book cover caught my eye). Even though I had been thoroughly satisfied with my previous plumbers who had a pay-as-you-go model, I was intrigued with this seemingly more informed, one price upfront approach. Who wants to get into a job and find out that the cost will be five times what you expected? So I called up this plumbing company and made an appointment to repair my split hose on my instant hot machine and my fridge’s ice maker.

Within two minutes of the plumber arriving, I knew I had made a mistake. The plumber charged 48.50 USD to just show up. (That was OK as I had been apprised of that policy when I scheduled the appointment). But after shining his flashlight under the sink for a couple of seconds, the plumber delivered this instant analysis: “We don’t repair instant hot units. We don’t carry parts to do repairs on appliances as there are so many brands and models. Yes, I can see that the hose is split (I had already made that diagnosis and had told them that when scheduling my appointment). The best I can offer you is a new instant hot unit installed for $695 plus $40 extra assembly fee because you have other appliances under the sink that are in the way that I’ll have to work around.” He continued, “Since we don’t repair appliances, if your fridge ice maker stopped working all of a sudden and there is no dripping water from a broken line, all I can do is charge you a $90 discovery fee to pull your fridge out from the wall and inspect the plumbing connection. Perhaps there’s a kink in the line. But if I don’t find anything, I can’t do any more as I can’t see where the line goes from the sink to the fridge. ” Hm, so how could he troubleshoot the plumbing from under the sink to the fridge? He wasn’t even offering me an end-to-end diagnosis.

I was extremely frustrated by his seemingly flawed diagnosis proposal and big-ticket component replacement offer. Pay as you go had seemed good in theory—but in practice it seemed a sham. The plumber quoted big repair $$ when I wanted confidence of a reasoned approach. Why couldn’t he repair a simple hose? What use was a quick look behind the fridge? It’s not like I had moved my built-in fridge since it was installed 7 years ago. He hadn’t even checked whether the water line was on (It was on. I had fiddled with it before he arrived, just to make sure).

This plumber wasn’t willing or equipped to do the little things that would maximize my satisfaction and minimize cost. He wouldn’t make minor repairs. And big ticket items or obvious diagnoses seemed all he had to offer. I paid $48.50 and sent him on his way.

I explored how repair my instant hot hose with handier friends and family, and then repaired it by installing a clamp purchased for $0.79 at The Home Depot. I plan on calling the fridge repairman because he’ll be able to perform an end-to-end diagnosis and can repair my fridge if that’s where the problem lies. Next time I’ll make sure the plumber can work by the hour and is willing to troubleshoot by the hour and make minor repairs.

What’s this story have to do with software? Well consider how you decide to get pay for software to be repaired, extended, or upgraded. At a first blush, a fixed bid contract might seem reasonable (or a fixed time estimate from your development team). But “quote one price for the whole shebang” arrangements can lead to padded numbers and the inability for creative wiggle room for making quick fixes or simpler solutions. On the other hand, with time-and-materials projects, you can ask upfront, “Well, how long does it take you to do a typical project like mine?” A developer might reasonably be expected to give a ballpark estimate based on prior experiences (and can tell you how glitches will be communicated and worked through). And if the team is following an agile approach, they'll deliver working software in small increments, keeping visible records of how long tasks take vs. initially estimated. If it turns out that a job is simpler or more complex than expected, with a pay-as-you-go approach, a customer get deeply involved in decision-making and can renegotiate priorities. Sure, there’s a risk ofpaying lots of money for junk or, even worse, unfinished software. But with frequent, open communications, problems can be spotted and approaches mutually agreed upon before laying out a big investment.