Tag Archive for 'project contract'

Project Contract- Building Mutual Trust on LimeExchange

Published
by
LimeExchange
on July 17, 2009
in Business, Freelance, Freelancing, LimeExchange, SMB, Service Providers and Small and Medium Business
. 0 Comments

The Project Contract on LimeExchange helps to determine in advance how the project will progress from stage to stage or milestone to milestone. Before the project execution gets started, both the parties have to agree to the terms and conditions laid out in the Project Contract, which comprises of milestones and attachments.

Why Project Contract?

  • Both the parties mutually agree on scope, deliverables, payment and schedule of project.
  • Increased transparency and mutual trust
  • Sustained monitoring of the project at every stage.

    • Project Contract for a Buyer

    On receiving a bid, the buyer can view the Project Contract sent by the service provider and can agree/disagree or edit the same. However, if a buyer edits the Project Contract sent by the provider when the project is in the bidding stage, the contract is automatically withdrawn. But if the project is in progress and a buyer submits a new Project Contract, the previous one would continue to hold until the new one gets approval from the service provider.

    A buyer can also attach:

    • Statement of Work (SOW) – stating exact scope of the work to be completed, often known as deliverables.
    • Master Service Agreement (MSA) – stating the terms and conditions and modalities for the completion of a project.
    • Non-Disclosure Agreement (NDA) – restrict providers from disclosing any confidential or business information obtained during the completion of a project.

    A buyer can award his project to a service provider provided the provider confirms his ability to execute the project within 48 hours of selection of bid and the Project Contract stands in the ‘Agreed’ state.

    Its Advantages:

    This unique work flow (Project Contract) safeguards a buyer’s interest against non-delivery or provider’s inability to work for your project, reducing the chances of any mediation. However, there are times when changes need to be made in the Project Contract circumstantially. In such a case, either of the parties may initiate the changes in the same but the other party needs to agree to the changes made therein.

    Project Contract for a Service Provider

    While bidding for a project, the service provider creates a Project Contract describing his bid in terms of milestones and project amount and sends it to the buyer for his approval along with the attachments (Statement of Work, Master Service Agreement and Non-Disclosure Agreement).

    It may also happen that a provider gets a project Contract from the end of the buyer. In such a case, he can agree/disagree or edit the same and resend it to the buyer. However if he agrees, it doesn’t mean that his bid has been selected and if he disagrees, it doesn’t mean that the negotiations between the buyer and him have come to an end.

    Its Advantages:

    Project Contract protects a service provider’s interest against non-delivery due to your preoccupation with other work and projects. However if he confirms to work on his project and the contract stands in ‘Agreed’ state, the buyer needs to escrow the project amount to our platform.

    Hope our Project Contract would minimize the chances of intricacies associated with project execution. We welcome your insights and suggestions on the same.

    How do I execute the project on an online services marketplace?

    Published
    by
    LimeExchange
    on June 1, 2009
    in Freelance, Freelancing and Service Providers
    . 0 Comments

    Freelancing has emerged as a ray of hope for millions of people around the globe in the current financial storm marked by government bailouts, bankruptcies, social unrest, recession, depression etc.

    Online services marketplaces have provided individual freelancers, SMBs & SMEs with concrete platforms to leverage outsourcing and incur huge dividends even in the current economic disquiet.freelance

    We are glad to share with you that hundreds of projects have been successfully done on LimeExchange in a period of less than a year since its global launch. This has encouraged us to bring to you the project management tips that will help you successfully execute the projects on an online services marketplace.

    The project management tips can be placed under 3 distinct phases of project execution:

    Getting started

    1. Bid on the project

    Before you bid on any project, make sure that your profile is complete and convincing enough for the buyer to consider your bid for his project. However, the bid that you place must be biddingcompetitive and reasonable based on proper estimation of manpower/skill requirements and hours required to complete the job.

    It is recommended that you include covering notes with the bid stating your past work experience and other details that would justify why buyer should shortlist your bid.

    2. Create a Project Contract

    To increase transparency, mutual trust, and sustained monitoring of the project at every stage, it is recommended that you set the scope of the project, milestones and corresponding payments and discuss them with the buyers through a Project Contract draft.

    Clearly specified deliverables and terms & conditions of the project will give right direction to your project management approach and help you to complete the project on time, without compromising on the indispensable element of quality. Once agreed mutually on these, you are all set to move forward.

    3. Initiate a Kickoff Checklist

    Kickoff Checklist contains questions on project related pre-requisites. This is most often requested by a buyer, after awarding you with the project. It is particularly important in case of large projects where stakes are high. Prepare a Kickoff Cchecklisthecklist and send it to the buyer stating that you have enough information about the project to get started. Such pre-planning of the project will enable you to deliver top-grade results.

    4. Split the project into smaller parts

    You can make the task of project execution easier by breaking the project into small manageable parts to ensure that you have not missed out on anything important. The milestones set for each stage of project would serve as signals to you indicating the ‘distance traveled’ and the ‘remaining distance to be covered’. This will pave way for better project management and execution.

    During the course of the project

    1. Prepare a list of to-do items for timely results

    Brainstorm considerably and come up with a well-formulated strategy of handling the project execution in the best possible manner. If you are dealing with a bulk project, you must prepare a list of important tasks to be attended. Prioritize the deliverables as this will help you to beat the time lines set for the project. Timely project delivery will win you great respect as a trusted freelancer.

    2. Communicate and Collaborate effectively

    In freelance business, communication is the key to success. Professional communication will enable you to build a trustworthy and warm relationship with your buyer, which will make project execution easier. collaborate

    On LimeExchange, you can easily stay in touch with your buyers through project collaboration tools such as Project Message Board (PMB) and Instant Messaging (IM). With these collaboration tools, you can discuss requirements, send status report, share files and seek feedback by asking the buyer to review.

    The more you communicate with buyer, the better your project execution will be. As a result, excellent deliverables will ensure you repeat business and long-term business relationships with the buyer.

    3. Attend to buyer’s queries and keep him updated with project status

    The immediate and fast response to buyer’s queries and requests will help you to successfully execute the project. Answer all his private messages and work out the time zone difference so that you can be online simultaneously and resolve project queries, in case if there are any.

    Also, an effective project management tool on LimeExchange such as Issue Tracker helps in monitoring tasks, logging issues and defects which can be tracked to closure. A buyer as well as a service provider can create an issue/task.

    Keep your buyer updated about the project progress so that your buyer is convinced about the right choice he made by hiring you for his project.

    After the successful completion of the project

    1. Keep in touch with the buyer

    In order to succeed in freelance business, you need to stay in touch with the buyer to develop long-term business relationship with him as this follow-up may materialize into some monetary gains in the form of projects in the future. You can keep connected to him through various social networking tools available in the market such as LinkedIn, Twitter etc.

    This step is often overlooked by freelancers. However, it’s essential as the feedback given by the buyer for the services rendered by you can earn you lots of new business and profits thereby.

    We hope that the above mentioned project management tips will certainly help you successfully execute the project and beat the time frames set for the same.

    With this project management strategy, get started now!

    Milestone-Based Escrow Payments: An Effective Risk Mitigation Strategy

    Published
    by
    LimeExchange
    on April 23, 2009
    in Freelance, Freelancing, LimeExchange, Payments, Service Providers and Small and Medium Business
    . 3 Comments

    Payment terms are equally important for buyers as well as service providers. Payments are a big concern for buyers. Often, they pay upfront for project delivery only to be surprised that the final deliverables do not meet their expectations and that the payments they made have gone waste. Milestone-based escrow payments provide an excellent mechanism to link payment schedule to quality and schedule. It’s also important for service providers to get some steady working capital while they work hard to complete an assignment. The best way they can safeguard their interests is by setting up their own milestones for escrow payment.

    What are Milestones?

    Milestones serve as signals that mark the completion of different stages of a project. They not only signify the ‘distance traveled’ (key steps in project) but also reflect ‘direction of travel’. Payments along with a set of deliverables are fixed corresponding to each stage of the project.

    Milestone-based payments…as risk mitigation tools

    Milestones are important steps in the project life cycle that outline a delivery schedule and corresponding payments for progressive stages of the project. These are generally set for big projects and also for ones, which need constant supervision at every step.

    At the time of bidding, the provider can break the large project into smaller chunks and draft a project contract specifying the milestones. Project Contract is a mutual agreement between buyer and service provider on scope, deliverables, payment and schedule of a project. It allows both the parties to agree in advance how the project will progress from stage to stage or milestone to milestone.

    This is indeed a great way for both the buyer and service provider to ensure that the project is on track and progressing as scheduled. It minimizes risks related to outsourcing and helps justify payments besides reducing risks through visible progress.

    For example, if there is web development project and both the service provider and buyer have mutually agreed on the below listed milestones through a project contract, then the payments would be released by the buyer to the provider after successful completion of each milestone.

    Milestones: (a) Approval of Design (b) Preparation of Prototype (c) Development of Complete Solution (d) Testing (e) Go Live

    Milestone-based payments on LimeExchange

    Project execution starts on LimeExchange after both the parties, buyers & service providers, have mutually agreed on scope, deliverables, payment and schedule of a project. However if there is any kind of disagreement, the buyer can add, modify or delete the milestones as per his wishes and then send it to the provider for his consent.

    Once the provider approves of the same, the project execution receives a green signal. As soon as the the buyer escrows the first milestone payment to LimeExchange, the provider starts working on the project.

    Release of payments as per the milestone status

    On LimeExchange, the Payment Status column in the milestone details shows the status for each milestone in the business agreement. Following are three phases of milestone payment schedule:

    1. Escrow Pending – The buyer has not escrowed the payment. Work cannot be started on any milestone until the payment for that milestone has been placed in escrow.
    2. Escrow Deposited – This means that the buyer has escrowed the payment and the milestone is in progress.
    3. Escrow Released – This means that milestone deliverables have been accepted by the buyer and payment has been released to the service provider.

    Milestones which have been completed cannot be modified. Once payment has been escrowed for a milestone, only the delivery time can be extended. Milestones which have not been escrowed can be modified by making changes to delivery dates, milestone amount or attachment.

    Be in control of your payment schedule!