So Very Close!

In an on-line article in Accounting Today entitled Value is in the eye of the beholder, Deena Katz writes eloquently about the subjective theory of value. For that I salute her.

However, she misses the mark when it comes to understanding exactly what she is providing. She writes:

Think about your services.

First of all, they are services (not goods), so people have a hard time determining their value. If you were selling toasters, it would be pretty easy for clients to pick one up, look it over and get a sense of how that item would look in their home. But no matter how specific we are about what we can and will do for our financial planning clients, it’s not easy for them to visualize the impact or outcome.

Close, but not quite.

What she misses is that her organization does not even sell service, it sells access to and/or transfer of knowledge.

PS – I wrote this as a post because Accounting Today does not allow for comments on articles.

6 thoughts on “So Very Close!

  1. Robert,

    Great question! I used to think so, but I was wrong. I believe we sell access to and/or transference of knowledge. In many cases, this does provide a solution, but sometimes it is not necessary.

  2. Robert, a perfect example of knowledge transfer that does not result in a solution is a business process review.

    Ed, that is exactly why we call our customer agreements Knowledge Transfer Agreements.

  3. I’ve a controller who wants an hour or two of training on a specific software enhancement that he purchased.

    Is there a way to do a fixed price on this? Or do I charge by the hour, with the customer deciding whether to continue after the hour is up?

    Remember that this is more ‘insurance” as the customer has tons of experience in what we are “teaching” and I see it as mostly “insurance” during the setup phase where he is wanting to be sure he gets the foundation right.

  4. Free, of course you can put a fixed price on it. Why not offer a few options:
    1. On site, this week: $500
    2. Remote, this week: $350
    3. Remote, next week: $250

    This is just an example, but you get the idea.

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