For 6 years, I did value pricing project management for a software development company, MightyData. FileMaker was the custom software development platform. During my years there, the company transposed itself from an hourly billing model to a value pricing business model. I developed the project management processes for the new model.
Value pricing is a strategy which sets prices primarily, according to the service’s value to the client. Other business models consider the provider’s cost more than the value the client receives.
Value pricing project management is not that different from managing projects hourly or by fixed price. The principles are the same. But, when you project manage value-priced projects, the adherence to scope and timing becomes much more focused. The price for the project is usually collected upfront. The price for the product does not consider the effort or number of hours. So, staying within the project’s scope is imperative to ensure delivery of the value promised to the client.
During my time at that company, the owner started another brand as a consultant to help business owners transition to value pricing. He interviewed me about my experiences in several episodes of the podcast that he produced, The Art of Value Show.
Value Pricing Project Management Episodes:
- In this episode from February 17, 2015, I talk about value pricing project management: managing scope, gauging effort and completing projects.
- In this episode from August 11, 2015, I talk about the value pricing project management process. You will get a glimpse into some successes and some not-so-successful instances.
- In this episode from March 1, 2016, you’ll hear an unscripted discussion on various topics such as Home Depot‘s return policy, TurboTax and more. This “Un-Episode” was an opportunity to experience what we did on a daily basis to woodshed different topics.