[humanrebar]

> ...they're often willing to accept a significant embedded risk buffer in a proposal if it means they can limit unexpected costs.

So if they want 95% confidence in estimates, you need to pad the estimate a lot. It doesn't make risk go away. It just offloads risk onto the contractor.

That just means the contractor is assuming the risk of missing the 95% estimate. It also means the head of the contracting operation needs to be diligent about backing up the estimates of his employees. Or mitigating risk some other way (making sure each contract is a small fraction of the business, having enough cash to absorb risk, owning lots of other businesses, etc.).

Now, realistically, the risk is also absorbed by the developers in the form of unpaid overtime, stress, lost bonuses, and in other ways. That's just all the more reason for individual contributors to insist on honest estimates. Or find bosses that understand business models better and don't offload risk onto employees.

[] I understand that this is complicated and bosses don't typically mean to make employees miss bonuses and have terrible work/life balance. But to some degree it doesn't matter. Intentions don't make down payments on houses, make sure kids do their homework, or get us a full night of sleep.