In 30 seconds
- Price and time are fixed; scope flexes.
- The highest-priority items are delivered first.
- Change is handled by swapping, not by change requests.
How they work
Both parties agree a budget, timeframe and initial backlog with rough sizes. The buyer orders the backlog; the supplier delivers in priority order. If new items appear, lower-priority items of similar size drop out.
Key clauses
- Swap items of equal size without extra cost
- Early termination if enough value is delivered
- Shared Definition of Done
- Regular joint reviews
Risks and how to manage them
| Side | Risk | Mitigation |
|---|---|---|
| Buyer | Less scope than hoped | Priority ordering, early value |
| Supplier | Underestimated effort | Size ranges, early checkpoints |
Myth vs reality
Myth · Fixed price means fixed scope.
Reality · In agile contracts, scope flexes.
Myth · The supplier carries all the risk.
Reality · Risk is shared through flexible scope.
Myth · Change requests are still needed.
Reality · Swaps replace most change requests.
FAQ
What's money for nothing, change for free?
A well-known agile contract pattern allowing early exit and free swaps.
How do we size the initial backlog?
Rough relative sizing, refined early.
Who orders the backlog?
The buyer, through its Product Owner.