Ditching Hourly

Hello and welcome to Ditching Hourly. I'm Jonathan Stark. Today I've got an audio excerpt from an answer I provided on my YouTube channel. You can check it out at thejonathanstarkshow.com and it'll redirect you to YouTube if you're into watching videos. Otherwise, you can just listen to the audio here on the podcast. Enjoy. Hey, Jonathan here. I've got a question from Giacomo Bale who asks, How would you go about evaluating the value when you're working on an open innovation project, meaning you study the entire pipeline and make recommendations on improvements? I don't know in advance where the bottlenecks slash inefficiencies are. All right, so the first thing I would think about is you find the value from the client. So if let's say the thing that you're doing is like, it sounds like an R&D thing. I don't know exactly what you mean by open innovation project, but it kind of sounds like a diagnostic where you're studying their workflow or their pipeline and then you're making recommendations on improvements. It's like a roadmap. It's like an audit. It's like a diagnosis with a prescribed therapy. So what you're doing is you're doing like an early phase where you're kind of like, we don't know what we don't know, or you're helping the client figure out. They know that they don't know what they don't know. And they recognize you as an expert who can come in and help them figure out what they should even be spending their time on. Or maybe they'll find out that everything's fine. So when you're talking to a client like this or a prospect, you need to try and talk them out of working with you. Say like, you know, have the why conversation. Why would you bother hiring someone expensive like me to review your pipeline? Why don't you just do it? Why don't you have some, you know, general, you know, generalists do it. Why don't you have an intern do it? Why not just not do it? Do you have some kind of problem? Are you recognizing some sort of inefficiency? Are you trying to capture some big opportunity? What is the motivation for doing this in the first place? And, you know, do you really need to do it now? Couldn't you do it later? Why is this urgent now? Why are you talking to me now? Did something change in the marketplace? Did a competitor make a move that seems like they're encroaching on your space? You want to find out all of these underlying motivations. Why this? Why now? Why me? And figure out from them. I mean, this is how you figure out what the value is worth. You asked, how would you go about evaluating the value? You find out from the client. What's it worth to them? And then you come up with some prices that are lower than what it's worth to them to find out to have this knowledge. Not the value of what any potential implementation might be down the road. So if you, you know, let's say you diagnose or you investigate or you do a diagnosis of their entire pipeline and you find a bunch of things that need to be fixed and then they have a bunch of people fix those things. That's not the value that results from those fixes is not what you're selling. You're selling knowing what to do. So it's an immediate result. It's not some maybe someday result where their efficiency is going to go up or their sales are going to go up or their churn is going to go down. They feel like they need an expert to come in and diagnose their situation and make recommendations. That in and of itself has a value. It either decreases risk. It's going to likely decrease waste on an implementation or whatever step comes next. It's planning. It's strategy. It's design. It's this thing that happens up front that business leaders need to make a decision about. They need some information to make some decisions and they don't have the information they need to make a decision that they feel would be, you know, they feel ill informed. They need to be informed. They want to make a decision. So the value is what is the value of not making a bad decision basically. So you would value it based on that. It comes through conversations with the client. All that said, you could probably just create a fixed price for this and sell it as a productized service with some boundaries around that would make it a fixed scope no matter who bought it. So you could just sell a diagnostic to people in your space that will have particular outcomes for the right buyer. So you would pick a buyer, a type of buyer, someone who's generally in the space that you're trying to target or would benefit the most from this kind of an engagement and you would just design the product. It would say, you know, it's going to entail these five things. Once you buy, here's what will happen first, here's what will happen next, then I'm going to do these things and then after that I'm going to give you this report, this outcome, this result, this diagnostic, these recommendations, this roadmap, whatever the outcome is and just set a price for it that's probably going to make sense for most of the people who are the right buyers for this thing. So you could go the value pricing route and just have a consultation with each prospective client about why they would...

doing something like this in the first place? And why spend all this money to have someone from the outside come in and just look around? You could do that yourself. Or you could sell it as a productized service, and then every time you sell it, and as you're attracting bigger and bigger clients, you just raise the price over time. So the first option, the value pricing option, you're going to leave less money on the table in the near term. And the productized service option, you'll probably leave some money on it, or you potentially could leave more money on the table early, but then as you raise the price over time, you kind of catch up. Okay, so hopefully that helps. I'm Jonathan Stark, and if you have a question for me, just hashtag AskJonathan on YouTube, LinkedIn, or Twitter, and we will answer it as quick as we can. Bye. Would you like to learn how to get paid what you're worth? How about selling your expertise and not your labor? We work through all of this together in the Pricing Seminar. Pre-registration starts soon, and you can sign up to be the first to know when early bird pricing is announced at ThePricingSeminar.com. That URL again is ThePricingSeminar.com. Hope to see you there. Hey, Jonathan again. Do you have questions about how to improve your business? Things like value pricing your work instead of billing for your time, or positioning yourself as the go-to person in your space, or maybe productizing your services so you never have to have another awkward sales call or spend hours writing another custom proposal. Book a one-on-one coaching call with me and get answers to these questions and others in the time it takes you to get ready for work in the morning. Best of all, you're covered by my 100% satisfaction guarantee. If at the end of the call you don't feel like it was worth it, just say the word and I'll refund your purchase in full. To book your one-on-one coaching call, go to JonathanStark.com slash call, C-A-L-L. That URL again is JonathanStark.com slash call. Hope to see you there.