Knowing the cost…
‘Every decision has a cost. Do I have to make this decision at all, or can I move on to the next thing? What we decided to leave out is almost as important as what we put in.’
- Joshua Schacter, Entrepreneur
Living the entrepreneurial life can be challenging.
You have this vision of Good that you want to give to the world, a unique value-add that makes what you provide (regardless of your industry) a real benefit for your client - yet you need to demonstrate this value. It needs to shine out in the sea of other options, to enable your clients to make a cost-benefit analysis to justify employing you.
And this is as it should be, because everyone in the ‘supply chain’ needs to somehow benefit from the exchange. And there is, somehow, a nobility in this. Ideally, the entrepreneurial supplier (like myself) can transparently demonstrate to their prospective clients how their costs are value-for-money. They will be able to be honest and open about how they’ve set their pricing, and confident in how they can defend this as a fair price.
But this is a scary process.
There is so much differing advice on how to set your costs, and how to work with clients to help them understand how (and which of) your services can fit within their budget.
And clients themselves vary in how transparent they are in relation to their budget, and what they want to spend. Some think that they should not say what their budget is, others say you need to give a range, and still others are willing to say directly what their budget is.
I know that it is far easier to provide the service proposal to a potential client when they are honest about:
what service they need; and
what their timeframes are; and
what their budget is.
It is like the funny old saying:
You can have it fast and good, but this won’t be cheap; or
You can have it good and cheap, but it won’t be fast; or
You can have it fast and cheap, but this will not be good.
These things (timeframe, required deliverable, budget) are the parameters in which the project’s scope must sit within. Another way to look at this is:
What do you need? (including to what extent you want evaluation and reporting to play in the equation); and
when do you need this by (including milestones along the way that are interdependent upon one another); and
how much budget do you have for this.
CASE STUDY:
I had a client from a medium sized federal agency who was working on internal service provision across their department. They needed a process driven facilitation that helped them discover how they could work with their internal stakeholders. Normally for consultations to be successful, the participants will need to know how their feedback will be incorporated into the plan for things to come. They need to feel valued enough in order for them to care and provide their real thoughts.
A critical tool in achieving this discretionary effort is the process for evaluation and reporting. While Insightful Path recognises that everyone’s budget and need for reporting is different, I talked with the client who hired me and discovered that the internal clients they needed to consult with had strong ties and relationships with their own team. They had an already agreed upon process for influencing directions, and with this, their need for reporting as a means of demonstrating how feedback was taken on, was reduced.
This, combined with their short timeframe in which to hold the consultation, and their tight budget, informed our decision to have a minimal evaluation and reporting process, where the feedback could be captured and reported on by my client’s own team members.
I designed targeted activities to capture specific elements of the consultation, and a process that produced the stakeholders’ important contributions. My client’s team was easily able to capture this data, and demonstrate back to their own stakeholders, how they would use it to inform future directions.
This saved the client the time (and expense) that it would cost me if I were do the data entry, data cleanse, data interpretation, and presentation - in short a full suite of reporting back to the client.
Our ability to rigorously talk through the needs, timeframes and costs enabled us to adjust the process, thus ensuring the consultation produced benefit for the whole of the project.
Additionally, I see a part of my role as not only serving my client or coaching counterpart, but I am also serving the nobility of the profession I am in, and role modelling best practice ethics, integrity, transparency (and even costing). This approach gives my client the opportunity to understand what is involved in quality facilitation, as well as encourages their own understanding of what it is that they need!).
This approach, however, requires more from my clients, as they have to actually discover and be transparent about what their intentions are for the day, and how they intend to use what is produced to benefit the participants. But then, if they merely hired an ‘off the shelf’ product without reporting, and without clearly identifying their intentions to incorporate the feedback they received, they may find reduced engagement with those they consult with. - As the title of this post says, every choice has a cost and, if you want to ensure value for money - you should ensure ‘knowing the cost’ of what you are buying…
If you resonate with these thoughts, please subscribe! Look me up, and reach out. I’d love to talk with you.
