February 19, 2016
Why We Charge a Flat Monthly Fee
Why do things differently? For years we created very detailed scopes of work that explained exactly what we’d do months in advance. We resourced teams that worked on many projects simultaneously in order to leverage learning across clients and sectors.
From this experience, we learned that we needed a way to structure our work, our teams, and our billing to provide greater flexibility and focus. Our clients’ needs would change and we’d discover things along the way that would influence what to do next and that would lead to constant, detailed rescoping. This became an administrative burden for brightspot and our clients. It also made it a challenge to predictably resource our projects.
Enter the Block… So, for the past year or so, we’ve adopted an approach to quoting, delivering, and invoicing for work that has provided our clients the greatest simplicity, predictability, and transparency while enabling us to adapt to project needs as they change.
We do this using a flat fee for a standard monthly increment of work – a “block”. Each block includes a project director guiding the team, a senior strategist leading the project, a strategist supporting the project, and a project coordinator managing the project scope, schedule, and logistics.
How does this work? To arrive at the overall project fee, we work with you determine the objectives and key questions for the project, then we create a general scope of work to achieve these objectives, and then we determine the number of months it will take our standard team to complete the scope and that is the number of blocks. If the scope exceeds what our standard team size can achieve in one month, we either add time in 1 block increments or if the end-date is fixed, we dedicate a second team at the same rate.
We build in flexibility so we don’t “nickel and dime” our clients if they need another interview or workshop. We communicate throughout so that we can fluidly change the project’s activities as needed and if significant additional work is needed, we simply extend the project timeline by the number of months / blocks.
Projects start on or around the first of the month and we invoice for one block each month (plus reimbursable expenses) and each invoice is accompanied by a list of activities and deliverables completed that month so you know what we’ve achieved together.
What have the results been? Since moving to scoping, delivering, and billing in blocks, the response has been really positive. We hear things from clients like: “This makes a lot of sense… We really value this flexibility.” and “This is so straightforward.” and “If we need additional work, we just add another block, right?” For us, it’s also made resourcing projects very simple because we know exactly how much work we can take on and so we avoid being over- and under-committed. It has also greatly simplified the process of creating proposals and invoicing for work so that we can spend more of our time helping our clients solve their problems.
We hope more consultancies and clients can move to this model in the future – it’s better for everyone!
– Elliot