Occasionally I find leaders asking for, or attempting to calculate, my “hourly rate”.
The answer is: I don't have one.
And even asking what it is comes from a place of flawed thinking.
Aside from the fact that most of Xquadrant's programmes include a software platform, content resources, and other features that make an hourly rate meaningless, here are six reasons why it's a problematic approach and a dangerous mindset for any leader serious about transformation.
1. This isn't a cake
Advisory services like consulting and coaching are not commodities, like salt, where a kilogram is a kilogram. You're not baking a business cake, where you need two eggs and three hours of coaching.
Hours are an irrelevant measure.
2. Value your own time
Your time is highly valuable: it's better to spend 1 hour getting a result than 10 hours (even if that one hour costs exactly the same). Rewarding an advisor based on the number of hours they spend with you is totally back-to-front!
Hourly billing means your incentives are fundamentally misaligned.
3. You need what you need
In my high-end packages I offer virtually unlimited support (via messaging, voicemail, or video calls depending on the precise offer), because when you need support to achieve your target outcome, you need it.
In contrast, knowing you're going to be billed each time creates a barrier to actually ask for the support you need. So it reduces the likelihood you get the outcome you want.
4. Why are you looking for cheap?
If you had a severe illness, would you pick a doctor based on their hourly rate? Or based on who can cure you?
Are you looking for the cheapest advisor or the one who actually moves the needle?
Because they’re never the same person.
5. You don't know the hours involved
How many hours does it take to prepare a session? Respond to messages? Run a 360 assessment or interview stakeholders? Create and share insightful ideas, articles and thoughts related to your goal and desired transformation?
You don't know and you don't need to. It's irrelevant to you.
6. Think like a leader, not a bureaucrat
Leaders make investment decisions based on the expected return (of money, and also of time), whereas bureaucrats focus on budget minimisation.
In my experience, when clients focus on the outcome they need they create a huge ROI from coaching. They don’t think in terms of time spent. They think in terms of results achieved.
Focus on outcomes and ROI, like a leader.
A better filter than 'hourly rate'
When I select my high-end clients, I apply two filters:
- Do they want to achieve something truly important and meaningful through our work together?
- Are they prepared to commit, and make an investment commensurate with that outcome?
- Am I a “hell yes” to working with them? Will it be fun, engaging, powerful?
I'd like to offer you that same filter:
- Get clear on the desired outcome for the work to be done. Is it ambitious and valuable enough? Is there the potential for a great return?
- Get clear on your commitment level. Are you ready to put real skin in the game?
- Get clear on your partner. Are you a “hell yes” to working with them?
A better mindset
Attempting to commoditise an advisory relationship into an hourly rate is a losing strategy. Far better to partner around a specific high-value outcome, with a tremendous ROI for you and an appropriate compensation for your advisor.
That's why I don’t charge by the hour.
I don’t sell time – I offer transformation.
If that’s not what you’re looking for, I’m not your guy.
