There are many things people are afraid of before starting their product: how to find a perfect team, how much it will cost and what they should do during the development process. Let’s find out how to deal with these and many other challenges, taking into account the experience of LinkUp Studio.
The first step is to identify which things in your project are really important to you and the rest of the people involved. What do you imagine your product should look like? What features should it have? What will bring value to the business? Do people need that? Are they ready to pay for it?
These are the questions you have to ask yourself to find your goal and customer. Then you can think of a team that will fit you as a partner. And probably you’ll want to start with preparing your budget, so let’s speak about three models of monetization.
Models of monetization
Fixed-Price cooperation model
It works just as it sounds. You pay a lump sum of money to the developing company in exchange for specific results being delivered. It’s one of the most popular cooperation models because a fixed-price contract makes companies feel safe and secure.
They have a set budget and thus are guaranteed not to pay anything more than that for the project. It is very important for you as a product owner to be very clear about the scope of work which has to be done, because this model doesn’t allow you to be agile.
Time and Material model
Here you pay the software team for the exact hours that they spend while working with your project. The most significant advantage of a T&M cooperation model over Fixed-Price models is that you retain much more control over the project. With this type of contract, you can decide in which direction the project should go as it progresses.
If there’s a sudden need to rework some parts of the project then simply add new features, or if an unexpected issue arises then the T&M model allows you to adjust the work schedule as required. The development team can also start working straight away, even if they (and perhaps you) don’t know all the project details yet. Those can be discussed in later meeting sessions.
This is one of the most favorite models for many product owners. Here you pay the fixed price every month, which goes to people who are exclusively yours. They don't work on any other projects, so you can absolutely rely on them.
The risk here might be having enough work for that time, as if your, for example, designer doesn’t work this month, you still have to pay him. But at the end of the day, the expenses will be the same as if you choose a Time and Material model. Lots of people just love this certainty that every month they will spend X amount and never more.
The Fixed-Price model works very well for the startups, Time and Material is a good solution for businesses and larger startups, and the Budgeting model works for all.
Responsibilities of product owner during development process
Pass project requirements as clear as possible
Even though this advice seems very obvious, sometimes it’s hard for the customer to define the exact amount of software project requirements that have to be formulated to reach the desired result. The more scrupulous the development plan’s discussion will be, the better product you’ll get eventually.
Clarify as many details as possible
It’s essential to stay in touch with the software development company and always be ready to ask or answer additional questions that may (and will) appear at some point. A product owner must be ready to give clear answers as fast as possible to avoid delays in the software development process and reach the best outcome.
Constantly review deliverables
Each stage of the software project development process provides different user-related deliverables such as user interface mockups, prototypes, intermediate versions of software, etc. And as a product owner, you should constantly check and approve these developer’s work results.
Being fully involved in the software project and providing regular feedback during the development process motivates the development team to provide better results.
Project budget control
The customer has to control the budget for project development. It is especially true for Time and Material projects where initially the scope of work, the budget is defined roughly, and requirements may change during the development process. And of course, every executor wants to receive payment for their services timely.
How to choose a team?
Those people are exclusively yours, but you have a lot of expenses: insurance, sicknesses, taxes and others. And there’s no guarantee that those people are more efficient and more professional in the technical sense.
Freelancers are cheaper, but it’s difficult to organize them. They don't have much interest in working with the team or with other freelancers you hire.
Outsourcing: offshore and nearshore
When you hire someone in your own country, it is called nearshore. Offshore is just the same, but from different countries. So you live in New York and your outsource developers can be from Ukraine.
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