As marketing budgets come under more pressure, there’s a greater need for teams to be more precise in the applications that they develop. The days of massive ongoing projects are disappearing, replaced with a rise of custom development projects that solve specific problems. And that means that marketing teams have a greater need to improve the way they evaluate projects and measure their success.
Some metrics that have been used to indicate ongoing progress in the past, such as hourly rates or the number of people assigned to a job, hold less validity today. It’s the difference between “work being done” vs. specific problems being solved. Busyness vs. effectiveness.
During the day-to-day development process, we need to be thinking about the value that’s being delivered.
It isn’t about cheap. It’s about precision.
Planning for uncertain market forces and tighter budgets
In the context of global economic uncertainties and conflicting market signals, you might be wondering how the medtech industry is doing and what it means for your budget.
Depending on the day you check, the news goes back and forth.
Consider the following:
- Evaluate Medtech foresees the industry growing at 5% a year for the next 5 years.
- Medtech Dive reports that analysts expect a slowdown, but not as severe as the Great Recession.
- Medtech organizations are increasing digitalization for efficiency in costs and procedures, as well as taking advantage of all the benefits that AI and machine learning offer.
What does this mean for marcom teams? Budgets might be tighter, but work still has to get done. In this environment of potentially flat or shrinking budgets, it’s essential to look back at who you’re working with and how you’re spending your money. Many teams are finding that their moonshots need to take a temporary backseat in order to get a clearly defined win that they can build upon. And to do that, it often means becoming more precise with the applications that they’re developing.
Why “precise” is better than “cheap”
We have seen results when clients focus on the precise option, rather than the cheap option. A precise solution is focused on the problem that needs to be solved, as opposed to using up a bank of hours. And as a result, it’s typically more efficient with your budget and timeline.
A precise solution makes your life easier in several ways:
- Projects tend to meet initial timelines more often.
- Projects tend to stick within the initial budget.
- Scope creep is limited or reduced.
- Clients feel more empowered because they are more aware of how each phase of development is meeting their needs.
Once a client approached us to help them make the best of a bad situation. Previously, they had hired a different vendor for a project that was about 60% complete when the main developer left. The vendor would need to train a new developer, and they told the client that the project costs would increase by 50% as a result. Rather than get stuck with that new bill, they came to us and asked for help.
This experience taught us a lot about projects that weren’t focused on being precise. While we got the inherited project over the finish line, it was brittle and difficult to support. The clients ate a lot of costs in the long term by not starting over and often got very little return for investment because updates were difficult and expensive.
Hourly rates don’t tell the whole story
It can be easy to lose sight of the total cost and value of a project if you only focus on an hourly rate. Value is often intangible. If you’re only looking at one part of the equation, you’re not seeing the whole picture. That’s why focusing on the value of the result requires considering more factors, including some that are less tangible.
The saying goes, “Nobody gets fired for hiring IBM.” And while that’s typically true, it doesn’t guarantee results. Locking in a lower hourly rate with a large firm doesn’t necessarily guarantee better value in what they deliver.
Which is better?
Option A
Option B
Paying $50/hour and taking 100 hours
Paying $150/hour and taking only 10 hours
With option B, you’ve saved money and your solution is in production much faster!
This principle holds true for other situations in our lives, including home repairs. Imagine that you have a leaky pipe in your home. You can choose a highly experienced plumber, or you can go with a general handyman that charges less. If you choose the handyman solely based on the hourly rate, you might think that you saved money. But what if their inexperience leads them to do a subpar job fixing the pipe and it breaks, floods the basement, and ruins some furniture? How much money did you actually lose? Deep expertise can more than offset a higher hourly rate.
This principle holds true for other situations in our lives, including home repairs. Imagine that you have a leaky pipe in your home. You can choose a highly experienced plumber, or you can go with a general handyman that charges less. If you choose the handyman solely based on the hourly rate, you might think that you saved money. But what if their inexperience leads them to do a subpar job fixing the pipe and it breaks, floods the basement, and ruins some furniture? How much money did you actually lose? Deep expertise can more than offset a higher hourly rate.
What to expect with a boutique development firm
Boutique development firms can bring that exact depth of expertise to your project. They offer the precision that medtech organizations need in this economic environment. They understand your problems and deliver complete solutions. They bring a high level of expertise to every project and a better return on investment. With a boutique agency, you’re less likely to experience scope creep because they focus on the holistic idea of what you need. They pivot with you as requirements evolve.
If you think about all of your vendors as just resources, it can be easy to lose sight of their value. You might be tempted to size them up based on the number of people assigned to a job or other factors that don’t tell the whole story. But per dollar spent, a boutique agency gets where you want to go more efficiently. You should be looking at what’s being delivered.
Take time to ask the right questions upfront. Find out why they’re competent with that type of project and what they’ve done in the past that’s similar. Ask how often they come in at budget and on time. A boutique firm should be able to answer these questions and help you set realistic expectations to give yourself the best opportunity for success.
It takes courage not to recommend the safe route, but it’s becoming increasingly common. Marcom teams can benefit when they work with partners that are focused on the end solution and know how to show value all along the way.
Remember, it’s not about “cheaper.” It’s about “precise.”
Resources:
Michael spends a great deal of time with the healthcare industry both professionally and personally, which gives him the perspective of what stakeholders on either side of the care equation need.
He began coding in 2008 and subsequently shifted his attention entirely to online marketing. Michael completed his MBA in 2018, focusing on the intersection of healthcare and marketing.
Justin Bantuelle balances the responsibilities of both the Chief Operating Officer and the Web Technology Director after having worked with Health Connective for more than a dozen years. Justin regularly leads the cross-disciplinary teams in building out and updating applications for Fortune 500 companies.
Justin keeps his technical abilities sharp by contributing to an eclectic mix of open-source and personal projects on Github.
Jared Johnson
Jared builds innovative healthcare brands through digital strategy and engaging content that turns heads. He is a keynote speaker, prolific content creator, host of the Healthcare Rap podcast and author of Connect the Docs: Put Digital Health Into Practice.
