Is it a Bad Idea to Pay a Lean Consultant Based on a Percentage of Cost Savings? | Mark Graban

See on Scoop.itlean manufacturing
Blog post at Lean Blog : The price paid for most management consulting work is based on either a daily rate or some variation of a flat-rate fee based on what is being delivered. Enterprise software pricing is also often fixed. In both cases, the client pays this with some expectation of benefits and even an “ROI” for the customer.[..]

Michel Baudin‘s comments:

I agree with Mark, and I am happy when clients report that they get ten times in benefits what our services cost. A daily fee for work done on site and a fixed fee for deliverables for offsite work are simple arrangements; paying a percentage of benefits, whether cost savings or revenue increases, is a complicated arrangement, conducive to misunderstandings and disagreements.

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