giving away money

Who, in your agency, is authorized to give your clients something for free? Are you going over and above the defined scope, budget or  perhaps burning through your retainer...regularly?

Here’s a scenario for you: Let’s say you have a defined project. Scope, deliverables, timeline and budgets are set in stone (well, yeah, I know). The client has signed-off.

The project comes in and the ‘well-defined’ brief starts morphing.

An AE or coordinator writes-up the job, and says, ‘see me or AE about details’. Because the scope is written and it’s a hassle to put additional details into a job form. You then have a kick-off meeting and everyone gets the details in their heads (and hopefully, in their notes) and moves forward with their own version of what they just discussed.

AE or coordinator takes a call from the client – perhaps we should do this or that – please explore. That gets passed along to Creative in an email. Still in scope? Yeah…it is. A freebie – by choice.

Bigger question – can we fit in the client's request and still make deadline for first round?  Yes, we’ll work late. But that’s OK because everyone is salary. It costs the same – right? Bring in dinner, get the work done. More freebies.

The next morning, the client calls – they have an emergency meeting, will have to meet after the weekend. Great!!! – more time to tweak. Anywhere along the line, copy / art / direction / strategy get another internal review - because you now have time to do more work! Massive opportunity to provide more free service, and perhaps get in even more work over the weekend.

Along the way, anyone who’s on the project has chosen – on their own – to just go in and do a little more of what they felt should go into the project. They just gave away a little more for free.

Time to present – gather materials and print-out / mount (if you still do that). And because no one seems to ever get materials together until the eleventh-hour, and everyone is in a rush, things have to be re-printed and re-mounted and keynote deck needs revisions. That additional time to massage the work has just added a significant amount of employee hours to the project.

Your presentation goes fabulously, client approves, then you produce.

Hmmm, images were just thumbnails and now the real thing is really expensive and restrictive. Production will require more time and money. Who pays for it? Should have known before you presented. Try to work it out. We have enough “padding” built into the budget. Should be OK. Freebie.

Been there, done that? So have I. The AE didn’t want to revise scope and estimate – because “we were all traveling so fast” and everything seemed to be within scope and budget. All the dollars, with perhaps the exception of production budget, have been spent by the time you do your first presentation.

I have a big issue here. I don’t care if your client is on retainer, or this is your bestest and biggest client, or if your entire staff is salary. You’re just really busy, and still making money. But you have to know how much stuff really costs. Because if you don’t, your client will say; “remember project X that you did? Can you do project Y at the same price?”. And you will say Yes.

So, do you know what that project actually cost?

Well, everyone along the line made personal decisions as to how they would spend their time, and what resources they would use - and they most likely went over budget. How many actually looked at the scope and budget? Do they know how? Is it available to them?

At the very least, a structured process, central documentation, and clear expectations allow those in control of the budget to make informed decisions as to where dollars are spent. And when it’s collaborative, it becomes real-time management.

With a good system in place, you will get a revealing picture of what it actually takes to get your stuff done. 

Then, when all is said and done, take a look at your original scope and budget - and compare them to actuals. The learning never ends.

By the way, require timesheets. Every day. And even though staff is salary, and the regular workday is eight hours, and someone worked 12. Have them put down 12. That is what it actually took to do the job.  

I will not listen to whining about timesheets.