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Do you
ever wonder if you are getting what you pay for? A
recent article in the New York Times detailed the
problems in the legal industry that track back to the
concept of billable hours. The same case can be made
for the PR industry as well.
When
you hire a firm that specializes in one area, are you
paying for their time or for their expertise? That
should be your biggest question. One way to answer that
question is by taking a look at how they are
compensated.
It is
inconsistent, even somewhat ridiculous, to offer to pay
a person extra to take longer to get something done, but
with the billable hours system, that is just what you
are doing. Some of the examples brought to light in the
Times article included lawyers billing clients for
attending hearings in which they were simply observers,
and lawyers fudging their time sheets to add hours to
clients’ accounts.
Requiring new associates to bill tons of hours is
nothing new. Any reader of a John Grisham novel will
understand that it is common practice. However, just
because everyone does it, is it the right thing to do?
If someone has to do something several times before they
get it right, should the client pay the price?
Persuasion is an art. Lawyers use knowledge and skill
to persuade juries and judges to see their clients’
point of view. PR firms use knowledge, contacts and
skill to persuade the court of public opinion regarding
their clients. In both cases, the outcome of the event
should have some determination upon the fees paid by the
client.
Perhaps most disconcerting is the fact that under a
billable hour system, incompetence is actually rewarded.
When a PR firm can talk to one reporter at the Wall
Street Journal and get a story published, shouldn’t they
receive a higher paycheck than the company that spent
two weeks unsuccessfully pitching the same story to
dozens of reporters all over the country?
It is
antithetical to believe that technology companies, who
operate under Moore's law of continually increasing
speed, should be represented by companies who are
compensated more for moving slower.
The end of
the article sums it up when one attorney was quoted as
saying that the billable hours system was forcing the
ethical attorneys out of the practice. The
solution is to move the model of law firms, and most PR firms, to
strictly results-based retainer fees. After all,
delivering realistic results allows for a relationship
based on true sustained expert consultation, not merely
burning through hours. |
