In the increasingly crowded software consultancy space, we've noticed a common trend. Too often, organizations believe that hiring more affordable and more inexpensive resources for their project will save them considerable money on their bottom line, but in fact, the opposite is true. Though it's easy to look at the hourly rate or the quoted estimate for a project and make decisions based on those factors alone, there are many other aspects of software implementations that require careful thinking. In most cases, we've found, whether working with an individual contractor or a large agency, many new clients come to Tag1 because they've had a disappointing experience with a consultancy that asked a lower amount for the project in question.
We at Tag1 Consulting consider it a labor of love that we are able to work with so many clients that require rescue projects—a disaster that has come from a poorly architected implementation or performance issues that arise because of inexpensive agencies that may have gotten in over their heads. One of the most frequent tropes we hear in many clients approaching us is the omnipresent question: "Why are we spending so much money on this project?" In many cases, customers have come to us with projects that have ballooned even an order of magnitude above their original estimation.
We're not alone in seeing this, and many other agencies and consultancies have privately shared with us that they are witnessing the same creeping trend. Increasingly, organizations are turning to and staying with Tag1 because they recognize firsthand the benefits and comparative advantages that working with more experienced and well-leveraged resources offers to their projects.
To learn more about the issues surrounding the false economy of low-cost contractors, we devoted a recent Tag1 Team Talks episode to a wide-ranging discussion with Peta Hoyes (Chief Operating Officer and Partner at Tag1), Michael Meyers (Managing Director at Tag1), and your correspondent and moderator Preston So (Editor in Chief at Tag1 and author of Decoupled Drupal in Practice). In the process, we took a look at how more affordable resources may in fact lead to a slippery slope that can be damaging for your timeline and for your forward progress.
Debunking the myth and the siren song
Here at Tag1, we know that many consultancies, particularly in the Drupal world, which has witnessed an incredible expansion globally with agencies around the world doing amazing work in Drupal, struggle with these problems. Though we often hear this with new clients coming to Tag1 with net-new projects, we also hear this from existing clients, who often have horror stories about previous disasters that came from inexpensive contractors. There are two main issues, each as intractable as the other: the myth that low-cost contractors produce the caliber of work required for high-performance, mission-critical projects; and the importance of frugality.
We're not immune to this problem at Tag1 either. Even though we make this same argument to our clients and prospects every day, supporting the notion that pricier people will result in more resilient work with lower technical debt and maintenance burdens, we've had this debate internally during our recent round of hiring for our own software product, Tag1 Quo, which provides security services for Drupal installations. But the notion that cheaper resources automatically translate into savings is an alluring siren song but also one fraught with risk. It's uniquely challenging to juggle the dual forces of wanting to get the best deal for our money but also desiring the best possible outcome for our Quo product.
Software has not become a "commodity business"
Many in our industry argue that software implementation today has become a commodity business. This misplaced notion is predicated on the mistaken belief that software has sufficiently evolved to the point where any engineer can rapidly assemble discrete components to compose solutions in mere days with minimal additional investment. And it's admittedly true that today's technologies lend themselves to a Lego-like approach to construction. Today's frameworks and libraries revel in rapid-fire, reusable, cookie-cutter components for most needs, arguing that armed with these components, whether rendered in Bootstrap or Tailwind, small teams can generate immense value and impact in a brief period of time.
But this notion that software is now a "commodity business" is a mistaken belief. Though there are plenty of publicly available components that can be remixed into a cohesive solution, for more complex implementations, it's seldom the case that the story is that straightforward. While it is true that technology today is increasingly componentized and Lego-like, replacing an entire architecture together with its infrastructure, or performing a massive replatform to a new stack, is not the same as assembling prefabricated, readymade components. As Peta notes during our episode, "There are big differences between building a foundation for a high-rise building and building the foundation for a two-bedroom ranch."
Peta added during our recent Tag1 Team Talks episode that there are other factors besides the building materials that influence the progress of a project, to extend the metaphor of house construction. Building a foundation may leverage the same construction techniques, but if the surrounding context is unstable and subject to corporate or other external forces, the steady hand of an experienced team is the right approach. After all, attempting to build a foundation in sand, an unpredictable and unstable medium that is subject to many outside forces, is a foolhardy endeavor.
The Frankenstein effect and high availability
Peta also identified what she calls the Frankenstein effect. In doing so, she asks, "How many organizations have you worked with that have a single monolithic system where everything is built?" Organizations big and small seldom have the internal unity to leverage a single monolithic system, framework, or tooling ecosystem across the entire company. The vast majority of organizations, especially those we work with at Tag1, grapple with a multifaceted patchwork of disparate tools and systems that don't always work well together. As we know well at Tag1, successful software architecture is not simply about putting the right pieces together; it is about putting different systems and components together in such a way that they operate in an optimal fashion.
When it comes to performance and scalability, Tag1 understands deeply the need to figure out how to cobble together or optimize complex systems so they work together in a milieu of cohering parts. And when it comes to building high-performance or high-availability systems at scale, not just a prototype or an experiment, but a bonafide well-performing application, substantial expertise not just in the vagaries of code but also in the complexities of architecture and infrastructure are required in spades. As Peta contends during our recent episode, "If it doesn't perform well, that doesn't mean that people will come and buy it."
Building high-availability systems is more of a science than a commodity business. It requires the knowledge of best practices at different layers, including hardware, software, databases, and networking; the foresight to know where systems might fail and the patterns that serve as leading indicators; the innovation to build new kinds of databases, monitoring tools, and caching algorithms; and sometimes even a bit of luck. After all, it's impossible to predict until actual loads are incurred how people will use the systems you architect, so good guesswork is a prerequisite as well.
The business impact of low-cost contracts
By making decisions primarily rooted in hourly rates or project cost alone, you do a detriment to the true cost and impact on your business. The impact of any project can be pervasive across an organization, and the hidden cost—represented by all the expenses not accounted for in the original estimate—can be astronomical so as to lead to catastrophe for your business. The disruption caused by inexperience can lead to reduced productivity of other team members (who need to perform more handholding, code reviews, and drawing down of technical debt), fires to put out in production, missed deadlines, and erosion of trust and confidence in your technical team, not to mention reduced morale.
The impacts on management and on the business's bottom line can be striking as well; these negative externalities will not merely impact your developer teams. If a project does not meet the needs of your business, you will lose multiples of what you had invested. Here at Tag1, we had a client approach us having spent multiples of what they were originally quoted, in the order of seven figures, and the project's timeline was overextended. Moreover, the project never delivered on the original goals and requirements stipulated by the client, leading directly to lessened investment in new initiatives. The best approach that we can recommend at Tag1 for anyone in this predicament is to evaluate not only the most overt aspects of value but also those that are more hidden and invisible—the true business impact of your project.
Low-cost contractors can certainly save you money when it comes to your bottom line as a business, and of course, there are no absolutes when it comes to quality in more affordable projects. For many projects that are able to leverage prefabricated components or that are relatively straightforward from the architectural standpoint, more affordable consultancies can help accelerate your digital transformation journey. It's important to emphasize that there are extraordinary contractors who are affordable, just as there are developers who command prices in excess of the quality they deliver. By focusing on both visible and shrouded types of business value, you can avoid these issues in your own organization.