Estimation

Budget is an important element for both the client and myself when doing work.
There are various companies in the world with different ways of thinking.
Below, I will explain my policy.

In this case, it will be a very rough estimate.
With limited information, the granularity of the estimated price is low.
I set the estimated price high.

In reality, there are few projects where requirements are defined in advance.
I present prices per process unit, such as requirements research, requirements definition, design, development, and operation.

To avoid unnecessary problems, I do not intentionally present low estimated prices.
When there is little prior information at the time of estimation, I will inform the client and present a price considering as much as possible, with the premise of re-estimation later.
There have long been two common disputes between clients and contractors (development side):

• The development side intentionally presents a low estimated price to the client during pre-contract negotiations to secure the project contract. After the contract, the development side, now the contractor, reverses the story and presents a high price to the client.
• At the on-site estimation stage, when there is little information, the client gets comparative estimates and says, “There’s a company offering a much lower price than you,” putting pressure to present a price that is clearly unprofitable for the work content.

What these two have in common is that “in the end, both the client and contractor only have unpleasant experiences.”
My policy is “It’s better to present a price close to what both the client and contractor will agree on from the beginning.”

In the information processing service industry, we must recover somewhere the investments and expenses directly related to work, such as education and training costs, communication equipment purchase costs, and communication costs.
In recent years, companies have continued to push costs due to price increases, which are being passed on to sales prices.
The information processing service industry is no exception, and investment and expense amounts are increasing.
I implement price transfer in the estimated amount for projects.

Very rarely, there are projects that set up revenue sharing or performance-based compensation.
I refuse these.
The reason is that there is no guarantee of business success when I am not deeply involved in the management side of projects that Wasoku participates in.
Companies that ask for revenue sharing or performance-based compensation don’t even show a business plan.
With this, there are absolutely no elements worthy of trust.

When asked for a price estimate for a project by the client, I will provide a very rough estimate or rough estimate until I receive detailed project information in advance or finalize detailed requirements. The rough estimate amount is basically set higher, and I do not present inexpensive amounts.

After scrutinizing the project details, I will present the amount as the official estimate. It is likely to be reduced from the higher rough estimate amount.

There are cases where the client absolutely wants to know the amount or development period at the initial stage. I can present this, but it’s on the premise that it’s a low-accuracy estimate.

Below is an example of what items or elements I consider in each process when calculating rough estimate amounts or official estimate amounts. There are items and elements other than those listed below for projects, which I confirm through Q&A with the client.

Requirements Research

• Observation of on-site operations
• On-site investigation
• On-site interviews
• Identifying problems in the target phenomena
• Market research

Consulting

• Business improvement

Planning, Requirements Definition

• Setting project goals
• Determining the direction of the website
• External design of web systems (DFD, IPO, ER diagrams, etc.)
• Creation and presentation of various planning and requirements definition documents

Design

• User interface design
• Content design
• System-side design (framework selection)
• Database design (database selection, item systematization)
• Creation and presentation of various design documents
• User flow estimation
• Creation of personas and behavior estimation

Implementation

• Web page development (prototype creation, modifications until completion)
• Web system development (new creation, modifications until there are no defects)
• Creation and modification of image materials using image processing software
• Database construction
• Operation confirmation
• Display and physical verification on browsers installed on smartphones, tablets, and PCs
• Creation and presentation of necessary documents as needed

Operation, Education

• Imparting knowledge about the internet in general, current thinking and methods
• Imparting know-how necessary for operation to website and web system operators
• Support in establishing guidelines necessary for operation
• Creation and presentation of documents necessary for operation and education

Project General

• General communication with the client
• Travel expenses for meetings
• Project management

There are differences in pricing methods and prices among website and system development providers.
It has been said until now that “pricing for website and system development is difficult to understand.”

My basic approach to price estimation is that the estimate amount is not just the cost of implementation.
My estimation method is to carefully calculate the necessary content for the job or project and present the estimate amount.

In addition to implementation, there are necessary things to complete the job or project, such as meetings and communications with the client, and proposals to the client.
Among website and system development providers, I occasionally see those who do not include the time and effort spent on non-implementation tasks in their estimates, or who consider them unimportant.

Among project clients, there are those who focus only on the cheapness of the estimate amount and do not recognize costs other than production and development.
In regular work, time and effort are also spent on interactions with people and organizations inside and outside the company.

There are no projects without modifications.
Until the client indicates their intention for final delivery, I will respond to minor modifications as many times as necessary.
Since time is spent on modification responses as well, the modification fee is included in the development fee of the estimate items.

If significant content changes occur from the initial requirements due to the client’s circumstances before delivery, or if additional responses are required, I will charge additional fees.

After the client has indicated their intention for final delivery,

• If there is a prior agreement or contract for post-operation maintenance
• For special reasons (due to changes in laws and regulations, force majeure such as natural disasters)

I will decline modification requests except in these cases. However, this does not apply to clear response errors in my construction process (specification errors, design errors, programming defects, etc.).

If individual contracts such as maintenance contracts are to be concluded after the start of operation, I will decide after consultation with the client.

Projects always come with budget constraints.
I strive to consider as much as possible whether all requirements can be achieved within the budget range.
If it is clearly considered difficult, I will explain the unreasonable reasons.
Also, if the client wants to realize everything, I may ask for an increase in the budget.