11 Hard Truths on Professional Services Pricing Few Want to Admit

For those just joining, I've been publishing weekly insights on adValorem.us. 10 weeks, 11 articles.

Whether you've been following along or not, here's an unvarnished summary of what we've covered so far:

1️⃣ Billable hours are evaporating. Unlike offshoring, AI doesn't move hours elsewhere – it eliminates them entirely. Pricing alternatives to the billable hour are about to get popular. https://www.advalorem.us/post/billable-hour-paradox

2️⃣ You're BLEEDING money on unprofitable clients. AI injected into the billable hour model means revenue is draining. Meanwhile, sales costs remain unchanged. You must ruthlessly evaluate relationships. The math is undeniable. https://www.advalorem.us/post/investment-fallacy

3️⃣ Traditional metrics are not your friend. Improving engagement margin percentage while total enterprise profit declines? That's not success – it's a warning sign. https://www.advalorem.us/post/margin-mirage

4️⃣ Legacy infrastructure actively prevents a move to alternatives. From compensation models to information systems, everything is designed to keep you selling hours that no longer exist. https://www.advalorem.us/post/great-decoupling

5️⃣ Everyone sees the problem, but shifting away from the billable hour is less popular than a colonoscopy. Real leaders make unpopular decisions when the future of the business demands it. https://www.advalorem.us/post/change-challenge

6️⃣ You already know where value is being destroyed. We all recognize the perennial underperforming clients and partners. Stop studying the problem to death and take action. https://www.advalorem.us/post/immediate-pricing-leadership

7️⃣ As Yoda said: "Do or do not. There is no try." Senior sponsors that allow dabbling in pricing innovation guarantees failure. Commit fully or don't bother. https://www.advalorem.us/post/professional-services-pricing-transformation-the-path-forward-for-the-ai-era

8️⃣ Simplicity wins. Clients only buy four things from you. Pricing complexity is YOUR problem, not theirs. https://www.advalorem.us/post/hidden-pattern-in-professional-services-pricing

9️⃣ Start small, grow virally. New pricing approaches won't be adopted through grand strategies. Find your innovators, create success, and celebrate it as it spreads. https://www.advalorem.us/post/strategy-sucks-why-successful-pricing-change-starts-small

🔟 Price ranks 13th in selection criteria. If you're obsessing over price competitiveness, you've already lost the value conversation. https://www.advalorem.us/post/price-doesn-t-matter-until-it-does

1️⃣1️⃣ Clients understand through comparison. Single-option proposals abandon your role as advisor right when clients need guidance most. https://www.advalorem.us/post/choice-architect-client-pricing

Which of these resonate most with you? And more importantly, what actions will drive meaningful change?

Disclaimer: The stories and insights shared in this blog are based on my personal experiences and conversations throughout my career. While some content reflects recent events, they are drawn from a broad range of interactions with professionals across professional services, including friends and colleagues from various organizations, and do not specifically refer to or represent any single employer, past or present. Identities have been anonymized, and quotes may be paraphrased or combined for clarity and storytelling purposes. This post is a personal endeavor and does not reflect the views or proprietary information of any employer.