High Overhead vs. Lean and Mean

A company I worked for some years ago tended to work on projects of a certain size. They weren’t what anyone would call large projects but they weren’t small ones, either. They carried a certain overhead: discovery, requirements, development, application, testing, verification. Once we had the model-building tool working we had to build the models within it, each of which involved a development cycle of its own.

After giving a talk at a symposium I was approached by a potential customer who wanted an analysis of a subsection of what we normally modeled, in several iterations with minor mods. There was no way this guy was going to pay $100-200k for such a thing, but when I told our team and managers about the opportunity they said they didn’t have a way to make it work for $10-20k, either. We did other analyses at that incremental cost for things we did repeatedly but nothing that required much in the way of custom development.

That always disappointed me. I get that things cost what they cost and I can also appreciate not wanting to lower the perceived value of your work, but I think it’s important to at least consider ways to capture additional value when opportunities to do so present themselves. It might be a good idea to examine whether smaller units of functionality might be of use on their own. Some might be obvious and some might not but consciously taking some time to think about it can’t hurt.

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