Essential Prerequisites for Estimates and Proposals to Avoid Project Pitfalls

Introduction

Since there seemed to be more demand than expected after I tweeted a little about it, I'll summarize it briefly here.

Disclaimer

• Writing these does not mean you can avoid all misfortunes.
• Depending on the relationship with the client, it might be better not to write some of these.
• Not everything I usually propose is listed here (some are from memory, others are due to professional circumstances).
• I cannot take any responsibility for anything that occurs as a result of using this information.
• This article assumes development on a contract-for-work basis.

However, I'm writing this down in the hope that sharing it will reduce the amount of unhappiness in this industry.

If there are others, I would be happy if you could suggest them via Twitter or in the comments.

Purpose of Writing Prerequisites

1. To clarify the conditions necessary to execute the project as per the estimate and proposal.
2. To make it clear what happens when those conditions are deviated from.
3. The above generally results in the following:
   1. Realization becomes impossible.
   2. Costs and schedule change (basically increases and delays).
   3. The schedule is postponed.

The choice between 3-2 and 3-3 depends on the situation. Ideally, being able to apply 3-2 to everything lowers the risk, but depending on the relationship with the other party, if you can't be that firm, you might opt for 3-3. In this document, I have written them in the way I tend to take, but please consider it carefully.

It can be difficult to apply 3-2 especially when neither your company nor the client is responsible. Such as during the COVID-19 pandemic...

In such cases, it may be necessary to prepare a buffer that can be absorbed within the project to some extent and only adjust the schedule. This might involve setting aside risk fees or clarifying the upper limit of the acceptable cost ratio.

Actually, I would like to know the ideal way to handle this myself.

Prerequisites for Estimates and Proposals That Help Reduce Misfortunes

So, I'll list them down. These are things I remembered after a night had passed, and since I haven't checked actual documents, there might be many more.

Also, I'm assuming that the details of the functions to be provided, the schedule, the amount, the general architecture (Cloud? On-premise? Web? Native?), the scope of the estimate, etc., are explained separately and not part of these prerequisites.

• This estimate is a [rough/formal] estimate for the XXX project (Rough = all amounts and details may still change).
• Scope of the formal estimate (basically separating the requirement definition phase from the subsequent phases).
• If functions not described in this document become necessary, we will provide a new estimate.
• If the non-functional requirements described in this document are exceeded, we cannot guarantee performance or operations.
• For areas where a feasibility study is required, such as non-functional requirements, state that those scopes cannot be guaranteed.
• All documents created in this project will follow our company's format (matching the client's format is likely to result in a significant cost increase).
• If the order is not placed by [YYYY/MM/DD], the estimated amount and schedule may change significantly.
• It is assumed that work following the completion of the requirement definition will be re-estimated after that phase is done.
• If the schedule spans fiscal periods, it is assumed that intermediate deliverables will be delivered and settled accordingly.
• If the contract period is divided by phases or fiscal periods, it is assumed that the order will be placed at least XX days before the start of the next phase.
• If the order is delayed, it may lead to the dissolution of the project team structure, resulting in significant schedule changes.
• It is assumed that necessary information, such as your company's network environment, will be disclosed as needed for development.
• It is assumed that materials required for development will be provided after appropriately masking personal information, etc.
• It is assumed that you will select a person in charge within your company who has the necessary authority to carry out the project.
• It is assumed that the project will be operated with a sufficient cooperative relationship between your company and ours.
• It is assumed that necessary stakeholders will participate in the project team and provide sufficient cooperation.
• Project meetings will basically be remote, and as a rule, will not be conducted on-site.
• The schedule may be reviewed if the situation regarding infectious diseases, etc., changes.
• The schedule may be reviewed if the delivery of hardware, etc., is delayed due to external factors.
• Creation of business operation manuals, procedure manuals, and training for use are excluded from the scope (do not accept these easily as the required level varies greatly depending on the target).
• If the operation and maintenance estimate is separate, clearly state that it is not included.

Copyright issues also need to be clarified at this stage. However, since it is a very sensitive issue, I usually either put it in a separate document involving legal counsel or ensure it is covered in the master service agreement so that it does not need to be stated individually every time.