How to buy consulting: costs, fees, expenses…

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AT HOME — I’ve been trying to figure out how I ended up with a four-digit dentist’s bill this month, without ever discussing even the procedure, let alone the fees.

And I can’t really make sense of it.

Similarly we have been working with a mid-level legal firm a few years and we keep getting bills through the door with what seems a very random assortment of numbers on them.  When we ask for ‘detail’ we can (twice so far in three years) get a long list of random adjectives and nouns:

 research
 meeting
 discussion
 teleconference
 draft

No time is listed against anything.  No context is provided.  Sometimes the bills don’t even have dates on them.

And we pay them!  I wonder why sometimes…

So let me tell you about how we — as a management consultancy — manage our ‘contracting’.

NO COSTS UNTIL AGREED

We will happily talk to you, meet with you, sometimes even work with you, before we even get to discussions about what kind of work you need, how we’d provide that… and what that would cost.

Those discussions are open and free.  As well as free-flowing.

Sometimes we’ll even tell you that we aren’t the right people to work with you.  Sometimes we’ll say that you need less support than you think.  The conversations are always interesting and we’d always encourage you to have them.

After we have discussed the problem we’ll start to talk about how we’d approach it.  At that point — and only once you’ve asked for it! — we would prepare a Statement of Work.  You would receive that.  Look at it, discuss it… and then hopefully sign it.

Only after all that… we’d start working and you’d start to incur costs.

EXPLANATION OF FEES

Like most consulting firms we charge on a ‘time and expense’ basis.  That means we bill hourly for work.

Some people find that hard to imagine.  So let’s put some parameters around even that to make it clearer. 

We set an estimate of how much the work will cost with you before we start.  (See Statement of Work!)  In that there is a single number that we have agreed.  Our work may come in below that but it cannot come in above it.  In other words, you will know the fees and your job is not to worry about each hour.  Fees shouldn’t really be a concern after we start.

…AND EXPENSES

Then there are the horror stories about expenses.  I’m not sure where they come from.  Probably from the rare occurrences when bankers or big accountancies spend too much at the bar.  Expenses should be part of the contract.  They are with us.  We work out the travel policy with you — if you want us to travel — and frankly, we often just take the Tube.  Expenses are not a big part of it.

What we like about consulting is the opportunity to make a real change and have a positive impact on our client businesses and our client’s careers.  Clearly we’re going to charge fees along the way.  But that shouldn’t keep people away.

If you have a question about it… please just call.

And if anyone is charging you like my dentist does (sorry George), just don’t put up with it.

/df



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