Charlabidding is the act of underbidding a contract, landing the client, and then over the course of the project asking for more money to cover the costs of what the customer really wanted/needed.
Ignocharlabidding is doing this ignorantly.
While ignocharlabidding is not as ethically wrong a charlabidding it is still very devastating to the community. This usually occurs when a contractor ignorantly underbids a project, and by the time it is recognized by either party the money is gone and the customer has to decide whether to put more money into the project or try to find another vendor. Since this is usually a small business transaction, the owner doesn't have the money to start over so he puts more money in hoping that will be the end of the over-run. This cycle usually repeats itself until a poor product is release or the customer becomes too frustrated to continue the engagement.
The harm done by ignocharlabidding is usually two fold: It sours the customer, and it puts money in the pocket of an ignorant charlatan rather than a legitimate knowledgeable contractor. So the bidders that knew what they were doing, and could have produced a good result, are left with nothing. The ignorant contractor has just survived for another couple months to live and bid again. And finally there is poison in the community that prevents or discourages other business owners to try to enter a new technologicaly realm.
Subscribe to:
Post Comments (Atom)
The whole concept is horrible. I can't believe people actually get away with that. Is that what our government is doing?
ReplyDeleteThanks for the thoughts. This post was specifically talking about small businesses or single contractors working with other small businesses in small communities where both are basically ignorant. If it does apply to our government It would require a post or an entire blog of its own to do it justice.
ReplyDeleteThere are some things to take into consideration here as well. As I have encountered many times, and I'm sure you have as well, things change. You hash out the details of what the client wants, you spell everything out as clearly as possible and you even plan a little extra into your bid in case there are cost overruns here or there.
ReplyDeleteInvariably they have their mind set on what they are spending their money on and are more conscious of the process having invested a good chunk of money on their project. Because they have this in mind and want to make sure their dollar is spent as wisely as possible, they are more conscious of what others are doing. Their vision changes and they want to add this or change that. In the meantime, you have invested weeks of time into developing and beautifying this project in an attempt to wow the customer. As you are nearing completion, the client calls in to check up on your progress. You inform him that you are days ahead of schedule. He reviews what you have done and springs some "minor" changes on you. All of the sudden you are facing a complete redesign of all of you work to accommodate these minor changes and weeks more time to complete the work. The client still expects you to meet the deadline and stay within the budget. What are you to do?
Obviously things have gone well beyond the scope of the original project. All you can do is point out where the project is going out of bounds of the original agreement and provide a quote for time and money to complete the site as he would like it modified. Or you can let him know that you would be happy to give him a quote for the new modifications he has envisioned, once the current project has been completed.
You paint this as black, white and gray, but there are so many shades of gray out there. You plan as well as you can, but you have to accept that unforeseen circumstances are the rule, not the exception.
-Kris
Excellent points. I agree that I painted a very clean picture of a very complex challenge. Even with the noblest intentions, and best of experience a project is difficult to manage especially in the realm of small business.
ReplyDeleteIt is clear that you have has some experience in this type of work, and I like your thoughts about how to manage projects. I have found the idea of padding the bid to be a common and successful one. In addition your description of the challenges of helping a client are definitely the biggest obstacles.
Thanks for you thoughts.