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The PM4Web blog was born as an outlet to return knowledge back to the web development community. My goal is to share my experiences as a project manager from over the years in a manner which helps you succeed with your own projects.

22 March, 2010

Writing Short, Easy to Read Fee Proposals (Part 1)

Creating fee proposals which are quick to write & easy to understand.

Due to the length of this article, it has been split into two separate but related parts. The first article provides the reasoning behind the proposal style. The second part describes the various sections of the proposal structure in more detail.

A while back I wrote an article called Writing Fee Proposals, since than I have learnt a few things which have led me to produce a new streamlined fee proposal structure (or tenders as many refer to them).

What prompted me to develop a better proposal structure? I had an experience last year where I lost out on a new contract. The client said I didn't get the job because my proposal was "too complicated". Up to that point I had thought being thorough and documenting everything in painful detail was a good thing - I guess not (at least not for everyone).

The biggest driving force behind the development of this new proposal structure was this thought: "people are busy, give them the facts and let them get on with their work". To achieve this goal, the proposal had to be short (generally 4-5 pages), it had to use the military principle B.L.U.F or Bottom Line Up Front (where facts are favored over 'fluff'), and it had to use language which would be universally understandable.

One of the major themes of the new proposal is setting up expectations. You've probably heard someone say "you have to manage customer expectations". Ideally, you want to lay down the ground rules for how a project is going to be run early on. What better point to do this than before the project has even started? I have seen projects in all sorts of trouble because it wasn't explained to a client early on that "this is how we run a technology project at our company". Trying to explain protocols once a project is underway is an uphill battle (not impossible, just harder than necessary).

I personally believe a proposal should tell a client exactly what they are getting for their buck. Seeing a line item like 'development cost' or 'consultancy service fee' is really no help to anyone. Having vague line items like these in a proposal just tells a client you aren't listening and don't recognize their specific business needs. Better line items would be 'development of shopping cart mechanism' and 'consultancy regarding off-page SEO strategy'.

One thing to keep in mind is that this structure is mainly suited to small to medium sized projects (e.g. 20 to 150 hours). I don't believe it is appropriate to use this format for bigger projects. You would risk under-pricing the project since you don't have enough detail to produce good estimates.

Let's take a brief look at the overall structure of the new proposal style (nb. part 2 of this article series goes into more detail about each section).

The First Page
• Big bold document title (e.g. Fee Proposal - ACME Website)
• Subtle note saying supplier & contractor details are in the appendix
• A single line describing what the document's purpose is
• A Cost Summary table (including the project's total budget)
Change of Requirements block - this sets out important ground-rules
Project engagement sign-off box - client's signature goes here
All this should fit on the first page, it's like a big executive summary.

• Introduction
- Purpose of the Website - briefly state the project goals
- Client Background - demonstrate you were paying attention & care
- Technology to be Used - what language & database will be used
- Project Schedule (not the actual schedule, mention one will be used)
- Non-requirements (saying what isn't included in the project budget)
- Contractor & client details
- Project Team (brief history & qualifications of people doing the work)
• Costs
- Change of Requirements - affect of adding new features mid-project
- Budgeting for Additional Features - prepare client for extra costs
- Third Party Costs - (e.g. hosting fees aren't included in the budget)
- Payment Stages - when milestone payments will be triggered
• Terms - when invoices need to be paid, that a deposit is required
• Software Warranty - describing what happens when bugs are found
- Logging of Bugs - describing how bugs are to be reported
• Content Management System - CMS license details

The most radical change is that I shifted nearly everything into an appendix. If it wasn't absolutely critical for the client to know something straight away, than it got shifted to the appendix. What this meant was that the client could potentially read just the first page and approve the project from that (not advisable of course). From the client's point of view, the first page contains arguably the two most important pieces of information; what am I getting, and how much will it cost? From a technology supplier's point of view, the first page lays forth the most important rules for the project (e.g. how feature additions will be dealt with).

The reason why the majority of the document is in the appendix is because it's hard to say what's most important to a potential client after stating what the costs and deliverables are. Delivery date would be high on the list too, but you can't know that until you've done the project schedule. The appendix contains many sections which probably fall under the category of "who cares" as far as the client is concerned, but nearly everything in the appendix is a bureaucratic must.

With regard to the language used in the proposal, you have to remember that the client may not be that tech-savvy. This means you can't just drop words like 'SEO' without explaining them, you have to at least expand the term to 'Search Engine Optimization'. Being overly technical isn't the only pitfall to watch out for. The single biggest thing which will improve the overall readability of your document is to use short sentences (don't be stingy with your full stops). If you really want to improve your writing, I suggest you look into something called the Flesch Reading Ease Test and Flesch-Kincaid Grade Level Test. Microsoft Word has features built into it which support these metrics. You will have to Google this if you want a deeper explanation since it's beyond the scope of this article. Suffice it to say I use both these tests prior to posting any article to this blog.

After submitting a proposal, it's good practice to make a follow-up call (or arrange a follow-up meeting). Once sent, let at least a day pass so the client has a chance to read the document, than ring up to ask how they went with the proposal (e.g. "hi Bob, it's Tony. I'm just ringing to see how you went with the proposal, check if you had any questions I could help with"). This does a few things: 1) it keeps you at the forefront of the client's mind (a good thing if you are vying for a project amongst other competitors), 2) the client may have not understood things in your proposal (so you have a chance to clarify), and 3) the client may be very busy with their business, so they may not have time to call you - you are proactively pushing along the project. On larger projects, with more granular break-downs of project deliverables, its best to organize a meeting to go through the proposal and explain things step-by-step. That way the client will know exactly what they are getting for their money.

One last thought about clients and how they view proposals. Consider that people have different learning styles (e.g. some are more visual learners, others are auditory learners, etc), the same may be true for how clients relate to different styles of proposals. Certain styles will appeal to some but not others. One client may like a detailed break-down of exactly what they are getting, because they want to know exactly where every dollar is going. Other clients may not care about the fine details of the project; they just want to know what the grand total is. This phenomenon poses a tricky question; do you tailor proposals structures to suit individual client tastes? I haven't tried this out, but there may be merit to the idea if it means the difference between locking in a contract or losing it. Obviously there are some draw-backs, including: 1) it would be a time investment to maintain multiple proposal documents, and 2) how do you even know which structure is best suited to a client you haven't had much time with yet?

Read Writing Short, Easy to Read Fee Proposals (Part 2) for a detailed break-down of each section in the proposal.

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