Hacker News Reader

Comment by hinkley | Hacker News Reader

I had a boss at a consulting company who really chewed on this idea. In the face of a potential boondoggle project, the discovery phase may be close to the last time your company turns a profit on a project.

Why not get the payments for helping them define the project requirements, and then if you still smell boondoggle, you can quote them an estimate that you can actually profit on but may make them run to a competitor for a lower bid. Now your calendar is clear for projects you’ll actually make money on, plus one of your competitors now can’t compete as well on your next bid.

But he ran into the same problem: an explicit discovery phase gets summarily rejected. Even though it would benefit everyone. I suspect deep down they know what they’re asking and they want to trick you into saying yes and getting sunk cost fallacy before you sober up and start telling them no.

View on HN

I agree that it usually doesn’t fly with clients, unless you already have a good relationship and track record with them. But I don’t think it’s supposed to be a trick. On the client side somebody either has some funding for a project and needs to know whether you can deliver within the budget, or they need to go and apply for some funding to complete the project, but in either case the deliverable they’re committing to provide in exchange for this funding is the completed project, not a scope for the project.

From that perspective the “discovery project” is just a much worse version of “contact us for pricing”, it’s “pay us $5,000-$20,000 or more for pricing”. Paying a lot of money to find out how much something will cost, or what you’re going to get from it (if anything) just isn’t a valuable proposition to a lot of people, and doesn’t fit in nicely with their existing business processes.

I've been advised to charge for a discovery, but at a ridiculously low price, say $500. It's likely they can expense it without approval, shows they are serious, and, helps you feel good about putting effort into a serious proposal.

Have you seen anything like that succeed?

I’ve seen folks successfully implement a process where discovery is ‘free’ if the client hires them for the implementation. Otherwise discovery is $10K or whatever

I haven't had problems with discovery projects. The framing is usually that both sides genuinely don't know enough about what needs to be done, you'll produce a rough plan at the end of it, and you've agreed to a rough ballpark budget beforehand where discovery is helping you decide on the scope and specifics.

Otherwise, even for simple projects, the process is usually you do a couple of rounds of questions for a few hours, then you're forced to give a quote when you don't know enough which is bad for both sides.

People get weird about charging for discovery, but gathering requirements, evaluating the current situation, researching options and proposing a solution, is tricky and valuable work, and doing this properly can save a lot of pain later.

The deal is that you’d have to provide the customer not just with a price quote but a complete requirements doc based upon the discovery. They can shop this to other contract houses. Just a bid leaves them I’m the hole with absolutely nothing to show for it.

Of course no customer would accept that.

Yeah.

Back in the day a proper requirements doc was something a client would pay for. It’s a tangible thing with real value.

These days we sell design sprints that produce validated prototypes instead (thank god for Figma). This is a much easier sell and still gives the client the opportunity to decide if we implement the thing or if they hand it off to someone else.

I think this depends on the scope/size of project.

In a previous role, I worked at a product-led consultancy in a niche industry which delivered multi-year + multi-phase projects. These were projects were delivered (on our side) on a time and materials basis, and could easily get into the tens of millions in fees.

There would typically be a 'requirements gathering' phase of the project where we held business workshops, where the output was a more concrete project estimate with potential timelines.

This is what would go into the signoff/contract of the project-proper. At this point the client could in theory walk away, with the documents we had produced as part of that phase. Think business process diagrams etc.

The client would pay for the requirements gathering, although I suspect like everything, there would have been discussion about how long it should be/how much it should cost up-front. The projects we had all had a similar phase, simply because it was very hard to know how much there was to do (on both sides) without detailed discussions about what their existing business looked like.

I currently work for a consulting company that specializes in SAP migration to cloud. A hefty portion of our business is what we call "advisory services", which is essentially just assessment, scoping, costing and documentation work before the real project. Sometimes a $50-100k advisory engagement turns into nothing, but sometimes it turns into multi-million dollar contracts.

Reply on news.ycombinator.com