Time is money. Time is value. This applies especially in the business context. So the most common practice to calculate the value of a design project is to take the hours spent to create the work multiplied by the hourly/ daily rate that the client and the designer agreed upon. But when the designer is able to deliver the solution faster, he’ll not be able to charge what he calculated and when a project takes longer, without the client’s fault, they have to pay more for the same result? – That doesn’t make sense…
The client is pursuing a certain goal and so they don’t care about the hours worked. They care about price. Hours are just a way to understand the price the project has for their company. Hourly billing is an accounting method resulted from industrial ages. It was never meant as a practice for setting prices for creative services. Basically, it’s not even a pricing method, it’s a billing method.
But the problem is even more profound: The client and the designer have completely different goals for the project.
The client wants to finish the work as quickly as possible to minimize the expenses.
The designer wants to take more time for quality of concept and design on each project.
So we have to change perspective on time and value in creative services and establish a new practice for setting a price for design projects.
The client wants to invest in the right team that will help them reach their business goals, minimize risk, and deliver the most value.
The designer wants to deliver the most value to the client by focusing on achieving their goals and delivering the right solution.
So now the client isn’t paying for time, they’re paying for solutions. And the perception of a design service shifts from an expense to an investment. Customer and designer are much more aligned to achieving success and delivering value. This allows them to have these most important conversations about what the client wants to achieve, what defines success in this project and what is the solution worth to them.
There are no hidden costs. The client knows the total price up front, leaving no room for argument about additional costs at the end of a project.
It shows commitment from the client that they’re willing to invest in the designer, and from the designer to provide a solution that leads the client to their goal and adds value for their company.
There’s less administration, no more logging the hours, no more feeling rushed and stressed about completing work without going over budget. Focus on getting good work done rather than how long it takes.
The designer is rewarded for efficiency, it encourages them to be more wise, efficient and focused.
The client is not penalized for slowness or misjudgments, this builds trusting relationships.
The entire focus is on value, not time. Obviously, you want to meet deadlines, but what matters the most is providing the client with the best solution to achieve their goal and creating value with a professional approach.
We will partner in our client’s success, meaning that this is a change of mindset for both us and our clients on how things are done.
We start by exploring our clients’ ideal future state. We mainly focus on what goals they have, where they want to be and how important or prioritized these goals are.
And is there a valid reason they are coming to us, and us specifically.
Then we focus on what the success of the project looks like, the metrics measuring the effectiveness of the project, what it would look like if the project fails and what is at stake?
The monetary value is determined by what value our client gets from the answers above. Through our process and consultation with them, we help the client to uncover their value of our solution.
Values, at their core, are emotional, they are different for every person, they are personal. This fundamentally changes pricing because what we provide, even if it’s the same exact thing is valued differently by each person or organization.
So when we get asked: “What’s your daily rate?”, we ask back:
“How much is it worth to you to reach your goal?”