Are You Managing Hours or Outcomes?

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Are You Managing Hours or Outcomes?

Another consultant is having a trying experience with a client. The client wants to see the consultant in the office more, but not pay for it. It seems that the client is used to buying hours, not outcomes.

I have run into quite a few companies that have never hired a consultant before. I figure that they are used to hiring bodies and managing bodies. They manage the hours you work; not the outcome of the work.

They do hire vendors, for example, a PR firm or a softswitch. On the one hand, with the softswitch they know exactly what they are buying. With the PR firm, it is more intangible. Both are managed differently.

Salespeople ideally are managed by outcome, but not really. Many salespeople do not hit quota nor do the perform the necessary daily activities. So no, they are not managed by results. The managers are managing bodies and hours.

If you rent a car, you don't want to own it or maintain it. You want it to get you around safely, while you have it. If you want, you can rent a better, faster, more luxurious car, but all you are doing is contracting for transportation during the prescribed hours.

That is how some consulting works. The consultant comes in for a set number of days or hours, bangs out the presentation, does some Q&A, sets a strategy, crafts a killer message, plans a product launch, then the company takes over from there. They hired for a specific function, a bunch of knowledge or guidance. This is not unlike hiring a lawyer or going to the doctor.

Consultants bill by the project or by the hour. Billing by the project is fine if there aren't any snags. In web design, there is usually scope creep and changes, which sink many a web design project - both for the designer and the customer.

When hourly billing, buyers may look for the cheapest supplier. That is when you know that they are buying hours, not outcomes. It might also be that they don't know what to look for when hiring that talent or skill.

We are moving to a freelancer economy - 40% of the population is now part of the connection economy. Managers are going to have to adjust to hiring tasks, projects, output, activity - as opposed to hiring bodies.

In a management webinar I am presenting, I am working towards re-adjusting managers' thinking towards salespeople. CRM was supposed to make sales activities more transparent - or at least trackable. It has been 16 years since Salesforce took off - and sales departments are still fighting CRM! And managers are not using the functionality to manage the funnel and the team.


Jim Rohn, a business philosopher, said, "You don't get paid for the hour. You get paid for the value you bring to the hour." True, but you get managed by the hour, not the output. In a world of big data and analytics, we still manage like there is still a wall phone.

Related Articles to 'Are You Managing Hours or Outcomes?'
Featured Events