Time and Material model is the most flexible business model in terms of both budget and projects specs. As with Dedicated Team, Time and Material model is suitable if the project specifications can be changed frequently. In this case, the total cost of the project is determined by the amount of time and effort spent on implementing the planned functionality. The actual budget may differ from the estimated cost and may be smaller or bigger than the estimate. The client is billed on a monthly basis based on the actual work done during the billable period and in accordance with the company price list.
When a Time and Material model should be applied
- There are no detailed specification, and requirements are likely to change in the course of development
- Final cost can’t be estimated due to the insufficiency of primary data
- The scope of the project can not be strictly defined and the development of the final product can take a lot of time
- Changes appear frequently during the implementation
- The client wants to keep an eye on the ball every time and take part in the project