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Saturday, June 11, 2011

Resource & Material vs Agile approach

What is wrong with Resource & Material approach?
Resource & Material approach is when customer pays for the resources working on the project and the invoices for travelling and similar stuff. 
Imagine you are the customer. Why you should accept paying your supplier for the people working on the project? I think you want to pay for the implemented features not for the people working on the project. It means you want to have it done so it can help you to solve your problems. 
The customer takes the big risk of loosing money by accepting Resource & Material approach.  
The supplier takes the big risk of closing down the business for the low customer satisfaction. 
What is good on the Agile approach?
The realization team must be committed to deliver what the customer needs while working in the agile approach. The commitment must be done for short time period, not for years.
The customer says what he wants to deliver in an upcoming time period. This gives customer good control and overview of the process. And the realization team can be sure that are doing the right stuff.  
Let's sum it up.
Don't be naive and plan work for few weeks, not years. Require realization team to commit to deliver something what is giving you a value at the end of each time period.