[IMGCAP(1)]There are many things to be thankful for in both my personal and professional life. And, of course, it’s that time of year when we ponder these things and reflect on just how far we’ve come. My personal list of “thankful” items is very long. My professional list is ample as well. In the spirit of the holiday season, and staying true to educating the profession, I would like to concentrate on my professional list—and one item in particular.
I am truly thankful for value pricing. I rejoice everyday knowing that I no longer need to track billable hours. I’m out of the hourly billing game—way out—and proud! Throwing away the time sheet has changed the culture of my firm for the better. It wasn’t an easy transition, but it was worth it.
Losing the time sheet created some major shifts. First, it moved us from a task-oriented culture to one that is client service-focused. It’s now about the value of the work we offer, not the hours it took to complete the project.
This frees my staff to offer a higher level of personalized service. And honestly, without the constraints of the time clock, it has created a work environment that is more fun and easy. It has also helped to create a more innovative and creative culture.
With value pricing in place, I also positioned my firm to be more profitable…and it has been. By eliminating the focus on tracking time, we can now evaluate other important metrics, such as customer interactions.
Consider this: I’ve enjoyed no cash flow or collection/bad debt issues because everything is based on a monthly fee. That means no more measuring profit in hours, but rather measuring revenue by services provided as a whole. That’s why we track interactions.
Like I mentioned above, the transition was not an easy one. There are requirements if you plan to implement the value-pricing model effectively. First, this model requires consistent leadership—managers who are ready and willing to give honest and timely feedback. It requires employees to be productive without the need for micro-managing. Most importantly, it requires that expectations are clearly communicated from the start, as well as and a more hands-on approach to firm and employee management.
So again, I would like to state that I am very thankful for value pricing. It’s made my professional life so much easier, and my staff happier. I recommend that firms implement this pricing model for 2012. I’m confident that you’ll be thankful that you did.
Jody L. Padar, CPA, MST, is a Certified Public Accountant experienced with Complex Federal & State Income Tax Compliance for Business & Individuals. Jody is an adjunct professor at Oakton Community College, where she teaches Taxation and QuickBooks Courses. She is part of Intuit Trainer Writer Network and speaks nationally on various Technologies and Taxation. She can be reached at www.newvisioncpagroup.com.