• The fixed price project


    10 min read

Here’s our take on what fixed price projects are, what can go wrong, and how dozillo can help with planning, scheduling and monitoring costs so you can deliver your projects on time and within budget.

So what is a fixed price project?

A fixed price project is a project that has an agreed upfront cost based on a certain set of deliverables. The cost will most likely be based on time estimates for how long you thought it would take to deliver the defined scope of work. The scope of work is usually defined in the project contract which will be referred to before payment is made for completed work.

It is important that you and your team read the contract carefully and ensure that the deliverables are clearly defined. Failure to clearly define deliverables is where the project can start to go wrong, as the client may have a different understanding or higher expectations of what they are getting for the agreed amount of money.

The Risk

With fixed price projects the supplier (you) carries most if not all of the risk. Often the project will have setbacks and take longer than you had originally planned for. It’s also very common for fixed price projects to encounter 'scope creep'. What is scope creep? This is when the client starts to slip in extra work that wasn’t originally budgeted for and defined in the contract. It is therefore very important to have a good project management process and robust change control process in place to tackle this so that your project stays on track and remains profitable.

Our top tips for managing fixed price projects
  • When estimating a project, break it down into smaller blocks of work and ask each member of your project team to give an estimate of how long they think it will take to complete.
  • Ask your project team to highlight any concerns they have and document these in a risk log, and work out a plan for how you are going to deal with these.
  • When you get a final cost estimated, build in some contingency by increasing the estimate by 10-20 percent. This will give you some breathing room should the project slip during delivery. If you think you need a bigger percentage, this might suggest you haven’t clearly defined the scope of work. In this event, we would suggest revisiting your estimate breakdown to make sure you have broken the deliverables down into small enough blocks of work to estimate accurately.
  • Clearly define and agree exactly what will be delivered with the client. Don’t leave anything open to interpretation. Make sure each deliverable has a clear description and can be easily understood and accounted for.
  • Define and agree your project management and change control processes with your client before any work begins.
  • Have regular progress and budget check-ins with your team and client throughout the project to keep a tight control on costs, budget, schedule and help identify scope creep.

How to set up and track a fixed-price project in dozillo?

Creating a fixed-price project in dozillo is pretty simple, just turn on the budget toggle and add your budget.

Know your project budget

Enter your project budget in time i.e. hours and minutes. Why time? Because as a service business you are charging for and tracking time. This is a more accurate way to understand how your project is performing because your team logs the time spent working on the project.

You should know how long your project is budgeted for in time by referring back to your original project estimate.

Dozillo Creating a project Screenshot
Scheduling your project

Create a start and end date for your project and dozillo will use this to plan where this project sits in relation to all other projects you and your team are working on.

Dozillo Scheduling a project Screenshot
Add your tasks

Once you have created a project you can start planning it out by adding tasks and assigning them to team members.

Dozillo creating a task Screenshot
Assign effort to tasks

Assigning time effort to tasks helps plan your project and manage your budget by letting everyone know how long they should spend and how much time is remaining. When your team logs time the task and project budget will update automatically, to give you a real time view of how your project is progressing.

Our quick time effort calculator makes it easy for you to add time to tasks. We believe most tasks shouldn’t take longer than a working week (5 days). If they do, we suggest the task is too big and should be broken down into smaller tasks so they can be tracked more accurately. Large tasks can easily overrun and it’s hard to get a sense of how much progress has been made, meaning you could get a nasty shock by the time it’s completed.

Dozillo assigning effort to a task Screenshot
Schedule a task

If you have assigned a user and a time effort to a task, dozillo will automatically calculate the due date based on the user's available capacity. dozillo takes into account all project tasks you’ve scheduled for that user to calculate an achievable due date.

Dozillo schedule a task Screenshot

If the calculated due date is unsuitable and you change it to an earlier due date, dozillo will warn you that the user has insufficient time and ask you to reschedule their existing tasks. Rescheduling tasks only takes a couple of clicks.

Dozillo reschedule tasks Screenshot

Keeping your project on track

Once your project is underway dozillo will automatically track it and alert you to any potential problems.

Capture real time project metrics

Dozillo always gives you a real time snapshot of how your project is performing. When your team logs time on tasks, it will instantly update on the project overview screen to let you see how your project is performing. Allowing you to take corrective action if needs be.

Dozillo project realtime metrics Screenshot
Monitor task performance

Keeping a tight eye on task performance will make or break your project. Dozillo shows you at a glance how your tasks are performing in every project. Under the 'managed by me' section you can monitor multiple tasks and projects on one screen, giving you valuable insights into planned schedules and assigned effort.

Dozillo tasks managed by me Screenshot
Make data based decisions

With dozillo you will always know exactly how your business is performing, allowing you to take corrective actions if needs be to steer your projects back on track. Such as identifying scope creep because tasks are taking longer; adding more resources to the project to help deliver it within the same time frame; or going through a change control process with your client to increase the budget and extend deadlines.

Dozillo monitor project progress Screenshot

Make your next fixed price project a success

Managing fixed price projects doesn’t have to be daunting. With clearly defined expectations, a robust change control process and the right planning and tracking tools you’ll be able to deliver all your fixed price projects on time and within budget.

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