Top 100 firm “inspired” by Ron Baker.
Over the past year, the Wichita-based CPA firm has been moving to a new revenue model it calls “value creation.”
“When you talk about pricing you ought to be talking about value,” CEO Kurt Siemers tells the Wichita Eagle. “Pricing is really driven by what the customer thinks (a service) is worth.”
Highlights:
The value creation agreement process starts when Kennedy and Coe has its meetings with clients to determine what services they need for the coming year. Those meetings lead to a value creation agreement, which lays out the services and payment terms for the year.
Siemers said prices for services are determined in part from the client’s “expected value” of the service.
“It’s a pricing model that understands that value in the client’s eyes,” he said.
As a rule, he said, Kennedy and Coe is not generating any more or any less money from these agreements than it was using the billable hours model.
“From a client’s perspective it’s much more accepted,” he said of the agreements.
He said that if, in the course of the year, the need for additional services or another project arises, then the client and Kennedy and Coe get together to develop a change order to account for the extra work.
He said fewer than 25 percent of Kennedy and Coe’s clients are operating under a value creation agreement.
But he hopes to have converted all of its clients to the agreement by March 31. “The realist in me says it might be June or September (2010),” Siemers said.
Original here.
