What happens when an accounting firm stops selling hours? In 1989, Ron Baker’s firm eliminated timesheets and hourly billing and began pricing every client upfront. What followed was a fundamental rethinking of pricing, client relationships, risk, and profitability—and lessons that remain remarkably relevant in an age when AI is rapidly reducing the time required to perform professional work. Drawing on decades of experience studying and practicing value-based pricing, this session explores what worked, what was learned, and what firms can apply today. Participants will examine the principles behind pricing on purpose, practical approaches for pricing uncertainty and complexity, and why pricing is too important to profitability to be left to a timesheet or a formula.
Course ID: PPWWL
Pricing Power: What We Learned When We Stopped Selling Hours
Learning Objectives
Upon completion of this course, participants will be able to:
- Identify the economic limitations of hourly billing and the advantages of pricing based on value rather than time spent.
- Recognize practical strategies for pricing complex or uncertain engagements, including the use of the TIP Clause.
- Distinguish between scope of work and nature of work and how each affects pricing decisions.
- Identify key principles firms can use to develop pricing as a core competency and improve profitability and client relationships.
Major Topics
- Lessons from eliminating hourly billing and timesheets in 1989
- Why customers buy value, not hours
- The economic limitations of cost-plus and hourly pricing
- Pricing as a core competency rather than an administrative function
- The First and Second Laws of Pricing
- The difference between value and price
- Pricing the nature of the work rather than merely the scope of work
- Using the TIP Clause to address uncertainty and complex engagements
- Offering clients choices rather than a single take-it-or-leave-it price
- The role of the Value Guarantee in reducing client risk and building trust
- Behavioral economics and the influence of anchoring and framing on pricing decisions
- Ten principles for pricing on purpose
- Why AI makes understanding value increasingly important as the time required to perform work declines
Who Should Attend
This course is designed for CPAs, CGMAs, and other accounting professionals who are responsible for pricing, profitability, client relationships, and firm strategy. It is particularly relevant for managing partners, partners, executives, and emerging leaders who want to strengthen their pricing capabilities, better understand value-based pricing, and explore alternatives to traditional hourly billing.
Fields of Study
Communications and MarketingPrerequisites
None