This document provides advice on how to properly cost a project by focusing on goals and deliverables rather than daily rates. It recommends that clients first identify the goals and their value, then agree with a candidate on the estimated cost and timeline. The cost can be structured as a daily rate for a set timeframe, a weekly/monthly maximum, or however both parties agree. Notice periods are kept short so costs can be cut quickly if the project is not working as planned. The goal is for clients and consultants to have a mutually agreeable cost structure tied to achieving project goals, not just daily rates.

1. transformation-leaders
How do I cost a project?

2. NOT by starting at ‘daily rates’

3. Daily and hourly rates are for piece rate
workers, infillers, accountants and
lawyers. Senior interims aim to deliver a
‘successful return on your investment’ in
their transition leadership expertise, far
greater than their cost.

4. Wise clients start by identifying the
goals of a project and their worth to the
organisation when successfully
completed. After that it’s a question of
agreeing with a chosen candidate as to
their own estimated cost and how long it
is likely to take to achieve the agreed
deliverables.

5. You can then agree a daily rate in a
timeframe, or a weekly/monthly
maximum, or whatever is mutually
agreeable. You can also agree a
completion bonus on a successful
achievement of goals if your board or
organisation has an incentive culture.

6. Notice periods are always very short on
both sides, for, if a project is not
working, (and since 2000 we have only
seen one that didn’t) the client is
naturally interested in cutting off the
cost quickly.

7. A top senior independent is also keen
not to waste his or her time on a project
that for a totally unforeseen reason,
makes the originally planned outcomes
not achievable.

8. END