What would a 'software guarantee' look like in practice?

Staged payments

I commented favourably on Managed Object's "software guarantee" here - but also commented that such a "guarantee" has to be worded carefully if it isn't to have unintended consequences.

Well, Managed Objects has sent me a sample contract which it would use as a basis for "milestone payments" from its customers. Milestone payments are what implement its idea of a "software guarantee". See what you think.

Milestone-Based Contract - SAMPLE

1st Five Deliverables

1. Project kickoff meeting: to be completed during Week #1 (Beginning the week of 8/28 – upon receipt of signed contract by 8/24)
2. Managed Objects workshop – Basic administrator workshop: To be completed during Week #1 (Begin on 8/24)
3. CMDB vision definition workshop: To be completed during Week #1 (Week of 8/28)
4. Installation of Managed Objects' BTI appliances and software components: To be completed during Week #2 (Begins 9/4)
5. Base Managed Objects configuration: To be completed during Week #2 (Begin and complete during the week of 9/4)

Final five deliverables

1. Visualisation/reporting of the service catalog – To be completed during Week #3 (Week of 9/11)
2. Testing/acceptance – To be completed during Week #4 (Week of 9/18)
3. End-user workshop – To be completed during Week #4 (Week of 9/18)
4. Advanced admin workshop – To be completed during Week #5 (Week of 9/25)
5. Project management – To be completed by project end (Week of 9/25)

Payment schedule

Payment will be made to Managed Objects, upon acceptance, by customer as follows:

1. Thirty-five per cent upon delivery of appliances and software
2. Thirty-five per cent upon completion of deliverables one through five as defined above and in the attached SOW
3. Thirty per cent upon completion of the final five deliverables as defined in the attached SOW

Notes

1. There will be no cost for the development system as long as customer remains current on maintenance for the production system.
2. Professional services – training – and implementation packages will be provided to customer along with an actual statement of work. The above professional services quote is a fixed bid and includes travel and expenses.

Software manufacturer:

Managed Object Solutions, Inc. 7925 Westpark Drive, McLean, VA 22102

I think this goes a considerable way towards making the company accountable for the quality of what it supplies. However, without denigrating this in any way, I suspect it isn't a unique approach – I'd be interested in hearing from other companies that offer similar contracts.

If there aren't any, it must be time for a customer power revolution in the software industry. ®