I much prefer a fee for the value our relationship brings to clients (we agree to what you want and need, and we get you that result) as opposed to fee for the service our relationship brings to clients (time, tasks, delierable etc.)
In other words, you should pay me for what you get, not what I do.
When a consultant or advisor charges for his time, two subtle but insidious (yes, I did say insidious) things happen to their relationship, which are not good for either party but are especially bad for the client.
Reason Number One Why You Should Pay for Value, not Time
The consultant tends to want to increase the boundaries and deliverables initially cited in the contract, often doing less essential or less valuable activities (more interviews, studies, reports, focus groups etc), to extend the amount of time needed for the project (think lawyer, accountant) and in so doing create more time (read revenue) for himself.
I do not want to be in a system that creates such a temptation.
You might argue that an honourable person wouldn't do that.
Indeed, but even honourable people sometimes jaywalk, fudge their expenses etc. for what they believe, given their particular situation, are perfectly justifiable reasons.
Hmmmmm!
Reason Number Two Why You Should Pay for Value, not Time
The second problem to charging for the amount of time I spend and not the results you get is that the relationship is then predicated on cross purposes, rather than trust. One party, the consultant wants and needs more units of time and more revenue per unit while the other party (you) wants and needs fewer units of time and less cost per unit. This can and often does make the relationship, one that must, by defition, be grounded on and infused with trust, become over time, rather uncomfortable, awkward or even adversarial.
In other words, at the basic agreement level, finances, we are already on an unspoken but different page.
Guess what that does to the most important thing in the relationship, trust.
It ain't good.
The Three Criteria For a Good Business Partnership
So my fees, once we reach agreement on:
1) Your business objective(s)
2) The measurement of those objective(s)
3) The value (results) that are important to you,
are based not on time but upon the value inherent in the project, that is getting you the results we have agreed to.
Let me say it again, the focus is not nor should it ever be what I do or how I do it but what you get.
Having a “meter” running negates any partnership in which the most salient and singular feature is the trust both parties have in and for each other.
I also don’t want to place any client in the position of having to make an investment decision every time my help may be required.
You Will not Lose Control of Expenses
With this arrangement, you can control expenses tightly and know your investment from the outset.
It also encourages you to call upon me without worrying about additional costs, and I’m free to suggest additional areas of focus I think are necessary without needing to ask you to increase your investment/cost.
To get you what you want within the objectives and parameters we have agreed to, I will commit as much time as necessary to fulfill the objectives we have agreed to.
"Jimmy, I thought we could get your group to where we wanted in three sessions. I think we will likely need another three. And as you know it is included in the initial fee agreement so the additional work on my part won't cost you another penny."
In other words, together, we can easily agree upon additional time being spent on aspects of a project without any additional fees or charges, except for travel expenses, if there are any.
For Those Who Still Prefer a Fee for Service
If you prefer a straight fee for my service and time, I will of course, after consultation quote you a fee for the work that you would like us we do together.
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