Fixed Bid vs Capacity

The biggest lie in software is "Fixed Price, Fixed Scope, Fixed Time, High Quality." Pick three (actually, pick two).

The Fixed Bid Trap

Client: "I want to pay $100k for this app." Vendor: "Okay." Reality:

• Halfway through, the requirements change.
• Vendor runs out of budget.
• Result: The vendor cuts corners. They stop writing tests. They use copy-paste code. They assign junior devs.
• End State: You get feature-complete garbage that is unmaintainable.

The Capacity Model (T&M)

Client: "I will pay for a team of 5 experts." Vendor: "Okay." Reality:

• Incentives align. The team wants to keep the client happy to keep the contract.
• Quality remains high because they have to live with the code next month.
• Risk: The client must perform Strong Product Management to ensure the team isn't just burning cash.