In catching up with my reading, I see Ron Baker has put out another case study covering some of the issues faced by those intent on value pricing and trashing the time sheet. This time it comes from Harrex Group in New Zealand where there is a discussion of some of the learnings they are passing on to others. I could not help but be struck by the similarities between the steps that Brendon Harrex describes and some of the principles I use when explaining to clients the strategies behind social computing. In the context of managing relationships:
Collaboration—we explained the critical importance of operating together rather than competing…Often we will need the skills of another relationship manager to assist with a customer and it may be that one of the relationships they are responsible for will have to take a back seat. In order for this to work, all within the organisation must understand that we are all about the success of the business, not just one silo…
The conversation with the customer is crucial to understanding what is important to them and where they want to go. Once you understand this, your entire solutions should be tailored to helping them achieve their objectives and this is how the most value can be extracted for the business, because this is most valuable to the customer.
While Brendon discusses these in the context of value pricing, the principles he espouses can also serve as a way of transitioning towards value pricing. This is something I’ve been arguing for with practitioners who are faced with increasing commoditization. Although not explicitly stated, these are principles that underpin the new practices I see emerging here and there and upon which I touched in a recent piece I wrote for AccountingWeb.
Later in the piece, Brendon adds:
They should expect to have to discipline some partners, change several roles around, and probably lose a few along the way. This is just a reality of change—some people will not cope.
This worries me. Many of the practices I come across find it inconceivable that change is necessary let alone desirable. As I said in my AccountingWeb piece:
The difficulty for professionals is that they find it hard to envisage a world where things will be different. Who can blame them when the principles upon which their businesses are built stretch back to the Middle Ages? That represents a lot of inbred DNA supported by applications that were never designed with the end user in mind but only the trained professional. Against this backdrop, it is easy to see why the notion of the accounting Black Swan doesn’t exist in the minds of most professionals.
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