using change orders with scope
how is a change order like taking your car to a mechanic? read on.
by jody padar
radical pricing – by the radical cpa
jody padar
who needs to understand scope?
don’t make the mistake of allowing a partner to scope the engagement alone.
by jody padar
radical pricing – by the radical cpa
when to walk away from a prospective customer
enabling your team to fire clients supports the ethos that your team is your most valuable asset.
by jody padar
radical pricing – by the radical cpa
when to increase scope and when to let it go
the most crucial aspect of scope is for everyone to know precisely what falls within the lines of the scoped services and what does not.
by jody padar
radical pricing – by the radical cpa
there’s a time to increase scope and a time to let it slide. let’s explore these two options.
it’s professional responsibility to inform a client when a request is out of scope. in this instance, you have two options: either make it a separate engagement or include it in the existing service package. it’s important to have everyone on the same page about what is within scope and what falls outside of it.
more jody padar | pricing | the radical cpa | from success to significance: the radical cpa guide | radical pricing
it would be best if you always built into your pricing agreements a 20 percent buffer to protect you against pricing mistakes. this doesn’t mean you should do work outside the scope for free, but if a client asks for a service not included, you could decide to let it go if the amount is immaterial.
however, if the value is greater or you need to investigate further, be clear with your team and the client.
determining a price … and when to change it
consider at least five issues when deciding how much to charge clients for your services.
by jody padar
radical pricing – by the radical cpa
what is the lowest monthly fee paid by any of your clients? you probably don’t want to bring on any new clients at a lower fee, so use this as your new business baseline. no one enters your firm without paying this baseline monthly service fee.
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however, the question remains whether the client will be billed on a fixed-price or value-priced basis. here are five issues to consider as you make this decision:
seventeen questions to ask when scoping
asking the right questions proves critical in selecting the right-fit clients.
by jody padar
radical pricing – by the radical cpa
using subjective questions helps you assess what the prospective client considers valuable. this means understanding which services and solutions they see as having the biggest impact on their financial health. it also gives you insight into where they are hurting most in their business.
more: which clients should you scope? | perfecting the client needs assessment | create more meaningful kpis | five reasons to ditch timesheets for good | six steps to creating a standardized practice | value pricing requires defining your clients | stop selling time | three critical factors drive the value pricing trend | stop looking for talent that does not exist
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this process is time-consuming because it sets the stage for your relationship moving forward. take your time and collect all the data, documentation and subjective input so you can gain a holistic view of the customer’s current situation. let’s take a look at some of the questions you can ask and why they are important.
getting aligned on scope helps your team and your clients
master the map to success.
by jody padar
radical pricing – by the radical cpa
there are two basic ways to drive from door county, wisconsin, to new orleans to attend mardi gras in february. the first is to chart a course using a map or gps app. it will tell you the route to take, where to stop along the way and how long it will take to make the drive. the second way is to start the car, back out of the driveway and head south, hoping you’ll bump into new orleans along the way.
more: create more meaningful kpis | here’s how profit sharing improves your firm | productize services for consistent client value | four ways automation pushes the paradigm shift | how value pricing impacts your employees | why pricing is so disruptive | accounting disruptors are heading your way … with deep pockets | advisory work must be priced by value, not hours
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which do you think gives you the better opportunity to arrive in new orleans in time for the festivities?
scope is a lot like creating a project map showing what you want to accomplish, who’s going to do what, how you’re going to do it, what you’ll need along the way and how long it will take to get there. it includes all the specific details of what you’ll deliver to the client, including, for example, tax returns, quarterly planning, bookkeeping and cash flow management.
create more meaningful kpis
employees must understand what they’re working toward.
by jody padar
radical pricing – by the radical cpa
key performance indicators separate the signals from the noise. throwing timesheets into the trash is your opportunity to focus all your attention on what is most important to your firm’s continued success.
more: five areas to ground new metrics other than time | five reasons to ditch timesheets for good | productize services for consistent client value | digitize clients for standardization | six steps to creating a standardized practice | four ways automation pushes the paradigm shift | are you the key signal caller for your clients? | value pricing requires defining your clients | how value pricing impacts your employees
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good kpis are quantifiable measurements agreed to beforehand. they must be important to the organization as a whole and specific. here are a few examples you might consider adopting:
read more →
here’s how profit sharing improves your firm
pay for performance to reap greater rewards.
by jody padar
radical pricing – by the radical cpa
as long as you’re changing how your firm operates, you should also look at how your staff is compensated. if your customers are paying for value, shouldn’t your teams be paid on the same basis? once your firm turns to a value paradigm, the people delivering the knowledge work – your staff – are your most valuable asset and should be compensated as such.
more: five areas to ground new metrics other than time | five reasons to ditch timesheets for good | six steps to creating a standardized practice | value pricing requires defining your clients | stop selling time | three critical factors drive the value pricing trend | stop looking for talent that does not exist
exclusively for pro members. log in here or 2022世界杯足球排名 today.
it’s all about alignment. clients pay on value. staff should be compensated on value. there are proven ways to make sure this alignment takes place.
five areas to ground new metrics other than time
you need to measure your progress and success, but not by the hour.
by jody padar
radical pricing – by the radical cpa
it may sound ridiculous, but the only people who are married to timesheets are professional services firms staffed by people who spend their professional lifetimes building their knowledge. every other company in the world has figured out how to sell and price products or services without relying on timesheets.
more: five reasons to ditch timesheets for good | productize services for consistent client value | four ways automation pushes the paradigm shift | how value pricing impacts your employees | why pricing is so disruptive | accounting disruptors are heading your way … with deep pockets | advisory work must be priced by value, not hours
exclusively for pro members. log in here or 2022世界杯足球排名 today.
why do professional services firms believe you should sell knowledge in increments of time? ron baker, an accounting visionary and author of “firm of the future,” once asked, “when you’re a knowledge worker, should you be selling your time?” i don’t think so.
five reasons to ditch timesheets for good
you get what you measure.
by jody padar
radical pricing – by the radical cpa
when you measure time on timesheets, you are measuring a scarce commodity. there are only so many billable hours in a week.
more: productize services for consistent client value | digitize clients for standardization | six steps to creating a standardized practice | four ways automation pushes the paradigm shift | are you the key signal caller for your clients? | value pricing requires defining your clients | how value pricing impacts your employees | 6 steps to start value pricing | what are you selling? | three critical factors drive the value pricing trend
by measuring billable hours, you’re living in a world of scarcity. this is bound to affect your firm, both internally and externally.
productize services for consistent client value
high-end alignment creates more satisfying client experiences.
by jody padar
radical pricing – by the radical cpa
now that you have hopefully standardized your services, it’s time to look at productization. productization is the packaging of intangible services to make them feel tangible. you put everything you will do for a persona into an offering that resonates with them because it’s customized for them. it’s then clearly priced so the buyer knows what they get for their investment.
more: digitize clients for standardization | six steps to creating a standardized practice | value pricing requires defining your clients | stop selling time | three critical factors drive the value pricing trend | stop looking for talent that does not exist
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this is just as useful for your clients as it is for your staff. clients appreciate it because they know exactly what they’ll get and what to expect. staff appreciate it because, unlike in traditional firms where there are at least four different ways to get to the same deliverable, this model has one pathway for each deliverable and service product, making it both efficient and traceable.
four considerations when standardizing client tech stacks
how to make sense of their various channels.
by jody padar
radical pricing – by the radical cpa
clients use the client technology stack to run their day-to-day businesses. the stack they use depends on their niche or vertical. for example, law firms use clio, while e-commerce businesses rely on webgility, among others.
more: digitize clients for standardization | six steps to creating a standardized practice | value pricing requires defining your clients | stop selling time | three critical factors drive the value pricing trend | stop looking for talent that does not exist | advisory work must be priced by value, not hours
exclusively for pro members. log in here or 2022世界杯足球排名 today.
the next tech layer is data aggregation. all the data feeds will land here, and you can determine what to do with and how to organize this information based on kpis or other metrics around which you’re building their business success.