Business-focused custom software

Noted author Steve McConnell discusses the various studies that show huge variations (10:1 or more) in the productivity of different programmers with the same levels of experience. Many of us in the industry have experienced this first hand - watching the destruction of a project budget by an individual who burned hours at an alarming rate with little to show for it.

But doesn't billing on an hourly basis just compound this problem? We are rewarding the individual who is least productive by paying him the most. It certainly gives the developer no incentive to work efficiently.

Most clients haven't heard these statistics, so it is quite an education for them to learn about them. Of course, setting rates based on who can accomplish the job the quickest probably isn't the right answer either. But it should be one of the factors in setting a fair price.