Reducing IT contract negotiation time by 12 days
We digitized the offer exchange process by introducing the 'Best Alternative To a Negotiated Agreement' algorithm.
DevPoint software house from Łódź wasted too many man-hours negotiating rates with B2B subcontractors. We shortened this process by 12 business days, removing unnecessary emotions and guesswork through pure mathematics.
The challenge
The company works permanently with a group of 34 developers. Every new project for an external client meant a flood of emails and negotiating hourly rates from scratch. The average time from first offer to signature was 19 business days. Due to this delay, in Q3 2023 alone, DevPoint failed to fill 3 key positions on time. They lost about 48,500 PLN in margin because the competition presented a ready team faster. Your rival had already calculated their chances, and DevPoint was still writing emails.
Our approach
Darek Nowakowski audited 47 historical offering processes from the last two years. We used game theory to find the points where negotiations stalled longest. We checked 12 behavioral variants of developers at different rate levels and payment terms. Mathematics has no emotions, so we built a BATNA (Best Alternative To a Negotiated Agreement) model that clearly defined profitability thresholds for both sides.
The solution
We implemented an offer analysis tool based on an algorithm. Instead of five rounds of negotiation, we introduced a two-window system. The developer provides their proposal, and the system calculates the margin and generates a counter-offer in 3.2 seconds based on hard historical data. The whole thing was integrated into the spreadsheet used daily by the HR team. We removed the need for board approval of rates every time if they fell within the calculated model.
Results
The contract closing cycle shortened from 19 to 7 business days. The HR team regained 14 hours of work weekly, which was previously wasted responding to repetitive budget questions.
Timeline
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October 2023Analysis of 47 contracts and identification of communication bottlenecks.
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November 2023Building the BATNA mathematical model and algorithm testing.
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December 2023Tool implementation and training for 2 HR employees.
"Numbers speak louder than a bluff. Initially, I feared an algorithm would scare off developers, but the opposite happened. A concrete rate and quick decision cut unnecessary talks. We have a contract in a week."