Time & Material vs Fixed Price contracts - How does it effect staff?

I've discussed before issues that are totally unique to fixed prices contracts and how many firms mismanage them because they try to use a T&M model.  From a business perspective, failure rates are high to those that don't understand the differences.  But, what kind of issues face a billable person that works on a fixed price contract?

Let's start with the work itself.  More times then not, the actual deliverable will be better defined.  If your working for a company that uses structured methods and process, there should be a clear cut contract or statement of work (SOW).  It's important for the staff person to have full knowledge and understanding what these items and when are they due.  It's important to try and front load the work.  This allows for the final stages of the project to be used for refinements.

Now the sticky part:  Money.  Your strongest point for negotiating your compensation is at the start.  Usually, all raises are fixed way before a bit of the work is started.  It doesn't matter if you did a great job or just average.  Now, if you didn't do the job as explained early on, expect not to last till the end.

With a fixed price contract, the reporting and status process becomes very important.  The management structure within you client community probably must report regularly to their upper management.  Do not, I repeat, do not go light on the documentation.  If you get later in the project and when issues arise, and they will, people will look for reasons for blame and correction.  Don't let it be you.  Even if you did a great job on the work and nobody knows it because your documentation and status reports are weak, expect to get that resume ready.

Remember, before you accept a position, get a good understanding if the contract is time & material or fixed price.  Ask questions about the time frames for completion and the expectations of the client.  I'm not saying the T&M contracts are a cake walk, but special consideration must be given and understood on fixed price situation.