Most of us are technical in our background and focus.  However, we have many facets of business we need to understand to be successful.  The area of business agreements can be confusing and seem overly formal.  Nevertheless, the documents related to this area are an essential part of clear communication and protecting the parties covered.

Read The Fine Print

First, let’s focus on the risks of signing business agreements.  It is not at all uncommon to be asked to sign a non-disclosure or non-compete agreement.  These often are mostly boilerplate and legalese.  However, there will be critical portions of these documents you need to understand completely.  These portions are the ones that define restrictions placed on you.

  • The scope of topics covered.
  • What is the timeframe for the document to be in effect? (expires in a year, two years, etc.)
  • How existing knowledge or products are impacted

A well-written agreement will address the area of work you do for a client as precisely as possible.  Thus, the business of EMR applications focused on providers would be a reasonable scope.  On the other hand, all healthcare-related software would be over-reaching.  You need to be able to continue to work for a living once your current employment or contract ends.

Expectations and Compensation

While many business agreements are crafted to protect the member parties, there are also a lot of details that define the work and pay.  This area is another essential part of setting clear goals and expectations.  A legal argument about compensation might be just one of the things you avoid.  I cannot begin to add up the wasted hours I have witnessed over the years related to expectations.  There should always be a clear definition of the work provided, the compensation rewarded, and any related time frames.

These factors are not just required for fixed-bid projects.  Even simple time and material projects where the agreement is X dollars paid for Y hours worked can get out of hand.  There are several questions you need to be able to answer in these situations.

  • Are there budget limitations (weekly hour limits, total spend, etc.)?
  • How does reporting and invoicing need to work?
  • Is a signature required or other forms of confirmation of hours worked?
  • What are the payment terms?
  • How should the invoice through to payment work?
  • Are there any expectations for overtime pay or refunded hours?

These are just a few questions to address while you are getting started.  They can be painful to the point of destroying a business relationship when left unhandled until an issue comes up.

Clear Communication

The last point to make is that business agreements are only the beginning. They provide a roadmap to doing business and providing a solution.  If you do not follow through on your promises, you can expect problems.  That is not to say that those agreements are not open to change or translation.  Be clear in your goals, progress, and any required modifications to your initial proposal.  This open communication will allow everyone to address obstacles before they become too big to overcome.

Learn more: Consulting Invoices and Getting Paid

Rob Broadhead

Rob is a founder of, and frequent contributor to, Develpreneur. This includes the Building Better Developers podcast. He is also a lifetime learner as a developer, designer, and manager of software solutions. Rob is the founder of RB Consulting and has managed to author a book about his family experiences and a few about becoming a better developer. In his free time, he stays busy raising five children (although they have grown into adults). When he has a chance to breathe, he is on the ice playing hockey to relax or working on his ballroom dance skills.

Leave a Reply