I've just finished up an unsatisfying engagement with a young and growing production services company.

It's not the people I didn't like, I think they're almost to a one, extremely talented, smart and capable people. It wasn't the clients. The clients were generally visionary, highly engaged in the projects, excellent communicators, and reasonable.

What I didn't like was how this company did business with its clients. It's not that the company was doing things that much differently from the accepted standards, but it was the unwillingness to adapt to new realities of digital production and digital business in general that wore on me and many of the other front line employees who's job it was to "get things done".

I won't go into any details about one project or another, and I won't even refer back to any particular instance, or even claim that these issues are specific to this particular company.

What follows are two visions of how to do business in interactive services, and how some practices are bound to create unhappy client agency relationships, demotivated staff, high-costs and mediocre work.

Fixed Bid Projects... are a terrible model for interactive services. Why? Quite simply, a fixed bid instantly creates the following dynamic.

• The tendency of the agency to tell the client that for the same money, you will deliver "more" than the competitors
• A calculation of how much you can make in profit - by doing the bare mimimun to meet the contract obligation, using the least expensive resources

While you may try to justify this and say, "When you buy a car, its fixed bid, and you make all kinds of promises". The difference is that the car is not a work for hire, and the buyer can inspect it as a finished product.

So in this respect, the agency embarks on a project where they are overpromising and looking to do as little as possible for their client. This arrangement is pretty much guaranteed not to lead to excellent work, innovation, or a long term client agency relationship.

Next, a look at the weaknesses of "time and materials" business relationships in the interactive marketing space.