Keith Hatter, CEO of coaching company K2 Performance Systems, explains why he no longer charges clients by the day.

Keith Hatter, CEO of coaching company K2 Performance Systems, explains why he no longer charges clients by the day.

In 2003, it became clear to me that customers who bought training and development services were paying on the basis of the time allocated to the training rather than the impact of that training. They were so hard-wired to paying this way that we frequently got asked the question ‘what is your day rate?’

The only party to benefit from this was the consultancy supplying the service. For the buyer of the service, it just doesn’t make sense. I don’t pay more in a good restaurant because it takes the chef longer to prepare and cook the food – what I’m paying for is the quality of the product.

Drawing on our experience working as coaches in elite sports, I knew that we’d never stop working for an athlete because their “time was up” – so at K2 we decided to charge by impact, not by time.

At first our customers were confused that we didn’t have a day rate but now it’s clear that it reflects our values and so has been the key to our success. 

Aligning our interests with our customers has been the best business decision I’ve made.