November 2006
Question
While in the final stages of contract negotiations, my client is resisting the idea of paying for program development and the need to customize content to their unique needs. He is a senior VP of Human Resources but I suspect he does not have a deep understanding of the training design process. The hospital's COO has met with us and has expressed interest in moving forward with our recommended approach. I suspect that he is pushing back on the pricing and has turned to his VP of Human Resources for an understanding of why they need to pay for development and customization. The work we are doing will result in about 3,000 people being trained in a specific skill area. Our pricing separates the design and development time from facilitation (which will ultimately save them money). Their response is, "you've already delivered this before to other clients, so why should we pay for something you already have.” They feel that they should only pay for facilitation. I liken this to the pharmaceutical industry. The R&D is their greatest expense and leverage point: they have built something that is tested and that works. I see my training as the same thing. Is there a simple -- yet detailed -- way to present the concept of intellectual property or leveraged insight so that clients understand why they are not just "paying for the book" but for the story contained in the book? Any insights around language that can be used would be very helpful! Thanks
Answer
Ed. Note: From time to time we invite guest experts to respond to questions in their area of expertise. Saul Carliner is an expert in design and an ASTD Research Fellow. Here’s his response.
On the one hand, you cannot force a client to do as you wish. But I have observed that consultants generally choose the issue that means the most to them and refuse to budge. For example, I know of one custom development firm that will not bid an entire project up front, they only bid for the needs assessment and initial design. In that way, they can (1) estimate development costs based on a complete design and offer significantly more accurate responses and (2) determine whether the work relationship is worth continuing through the development phase. Customers who refuse to participate are not considered.
Another custom development firm insists on conducting a needs assessment. If a potential client refuses, the principal walks away from the business. A third custom development firm insisted that clients share rights to all programming and graphics developed. If a potential client refuses, the principal in that case also walked away from the business.
In other words, how important is the needs assessment to you? Are you willing to insist on it, and walk away from the business if the client refuses to pay for it? If so, then that's what I would recommend doing. The only time that you can really negotiate like this with a client on this issue is in the bidding phase. During that time, you can say "these are the non-negotiable elements of the agreement."
But it sounds like your organization already has an agreement in place. In this case, you inform the Senior VP of Human Resources that the per-student rate for facilitation is only for the off-the-shelf version of the course. It will not include any company-specific content. If the organization would like to pay that rate and include company-specific content, they can provide their own instructor to teach it. In addition, because that will include coordination, you would require one to three days of consulting time in advance to make sure that the company-specific material is properly integrated by a staff trainer. You might also estimate the cost of a staff trainer to customize the content, and the time needed for that person to teach it.
But in the end, if you strongly believe in the separately priced needs assessment, you also need to be prepared to walk away from the business if the client refuses. Otherwise, future clients may learn of your flexibility and you could find yourself in a similar situation.
Saul Carliner
Assistant Professor, Graduate Program in Educational Technology
Concordia University, Montreal, Quebec.
Email: saulcarliner@gmail.com
Web Page: http://education.concordia.ca/~scarliner
Co-Author, Advanced Web-Based Training (Pfeiffer)
Author: Designing E-Learning and Training Design Basics (ASTD Press)
Question
I am an independent cross-cultural trainer with first-hand immigration experience in the US, over 20 years US work experience (not training related profession), and obtained additional degrees and certificates in cross-cultural training. So my experience in the training field is limited. My long-term goal is to eventually develop my own train-the-trainer programs for others with similar experience. My problem at present is locating and engaging clients who I know need my services for their immigrant employees but they do not see the value of the services. Is it better to build a client base by delivering short programs to meet their budgets so I can get started, (knowing that a comprehensive program would be more effective, however, they are not willing to pay for it), or slowly build my experience by only doing comprehensive but more effective training programs, for companies who are willing to pay for the value of the programs (and may only find one such client per year, if any)? In the meantime, I need to find a full-time job to pay the bills. Which would give me more credibility in the long run? Thank you.
Answer
Ed. Note: From time to time we invite guest experts to respond to questions Madeline Finnerty has over thirty years as a successful consultant. She has experience working with individuals, groups, and whole organizations to facilitate strategic planning, design and implement change, and develop essential skills for interpersonal effectiveness. Here’s her response.
What does it take for a consultant to succeed? Relationships, relationships, relationships. When you are delivering a knowledge-based service, my experience is that the secret to success is to build relationships with clients, colleagues, other business people, community leaders, and even friends who one day may have a referral for you. That also means clients who can only afford you for a few hours.
If you have a potential client with an immigrant work force who asks you to deliver a short program, use that as an opportunity to get to know the client and the organization. As you are conducting the training, you will meet employees and hear about the issues which present themselves in their workplace. Think about what they are telling you and integrate their challenges with the services that you know you can deliver. Get to know your client personally and find out what daily life in the organization is like for this person. What business indicators are most important? What are the biggest challenges? Listen with a sympathetic ear.
After the workshop, you can translate the stories you have heard into opportunities for the client to save money, increase quality, improve production—all with additional help from you. Now, what you are offering is not just training for immigrant employees, but tangible business improvements. We refer to this as performance management.
Although we may recognize that companies will benefit from our services, many clients don't translate our training and consulting activities into business outcomes very well. When you understand both sides of your training—development and delivery from an experienced cross-cultural trainer's perspective, and outcomes of a better trained immigrant workforce from the manager's perspective—then you can present your services using language that enables potential clients to grasp the value.
As long as the work you do is quality work, you will gradually build a fine reputation; and when clients are ready and you can demonstrate the business advantage, you will have work and ongoing referrals. Credibility is not a matter of the length of the program. Credibility comes from doing good work. Be clear about what you can accomplish in a short time frame and deliver good work. Sometimes a little team building at a staff retreat is really all the client wants. Sometimes it opens the door to multi-year relationships as you and your clients are continually able to identify new applications for your skills to their needs. Other times it just results in a good relationship, an occasional small workshop, and maybe even a referral to another great relationship!
Madeline Finnerty, Ph. D.,
Ashland, OH
419-281-4494
madeline@bright.net.
Author of "Coaching for Growth and Development", in R. L. Craig(Ed.),
Training and Development Handbook, 4th ed.
