I put up a post on LinkedIn last week asking how ‘Fee For Service’ was still a thing and it has raised some interesting perspectives. By the way, if you would like to check that out and to join the conversation click here.
So, I thought I would raise the next logical question: ‘What exactly is your value to a client?’. Because this may well be THE question, it is going to take more than one post!
Today I am going to share with you my number 1 overlooked contributor to misaligned client value perception.
Perhaps I should start by saying what I do NOT believe your value is.
It is not:
- How much you do for a client
- How little you charge for what you do
- How many hours you spent working for a client
- A reflection of how happy a client is
- A reflection of how quickly a client pays their bills
- How much you were able to bill a client
- How much money you saved a client
- How much money you created for a client
- How good your advice or service was/is
- How experienced or knowledgeable you are
Whilst none of the above are your value, each of these may contribute to the creation and translation of your value. You could say, don’t mistake the ingredients for the cake.
A problem with our definition of value
In its simplest form, value is a seemingly nebulous psychological reaction, if you will, a perception that exists in the mind of your client.
A typical dictionary definition runs like this :
“The extent to which goods or services are perceived by its customer to meet his or her needs or wants, measured by a customer’s willingness to pay for it.”
Value isn’t just in the clients mind
You see, whilst technically true that value is ultimately in the mind of the receiver, it is also completely false because that value is inextricably tied to the ‘perception of value’ of the professional providing the value.
It seems clear that value is created by the perceptions of both the provider and the receiver of a service as they interact to create a psychological shift in the mind of the receiver.
Of course, with businesses that have an ongoing service model with their clients, the value is the result of a ‘perception loop’ between the deliverer and the receiver that is a constant state of mutual interaction.
What does this mean?
It means that the ‘perception of value’ of your clients is inextricably linked to your own perception of your value.
The vaguer you are on your value, the vaguer your clients will be too. The more you perceive your value to be based on weak influences such as time, returns, process etc, the more your clients will consider your value to be based on those things and the weaker their overall sense of your value.
I find professionals rarely have a problem with ‘sales’ or charging appropriately, the problem is in fact with their own perception of value, either in what they are doing or more specifically themselves.
There are a thousand things to look at when helping to drive the effectiveness of a Services Firm, yet there are few that can create the kind of radical results that shifting into alignment the ‘value context’ of the professionals who work in that firm can create.
Most often the greatest opportunity exists in helping the firm owner/s to define their own limiting perceptions of value that are unconsciously being communicated both internally and externally.
In my experience, you must first liberate your own concepts of value before you can truly engineer a business to create maximum mutual value for you and your clients.
Whilst clients have their sense of value affected by a huge range of variables, in my experience, the single greatest determining contributor is the perceptual cues they take both consciously and subconsciously through YOU.
Baz
P.S. If you would like me to expand on both the data behind this as well as expanding on the theory and action you can take to master the art of value, please let me know in the comments…