Putting a price on quality

You can put a price on quality, and in fact, you must…

Forget the old maxim “you can’t put a price on quality”. You can. In a commissioning environment that’s under increasing pressure to cut costs, it’s more important than ever that you do, and you’ll need three ingredients to do it.

Commissioning is a competitive marketplace, and there are only two ways to win in that environment: provide the lowest priced commodity, or provide the best value alternative; the key word being value. That means understanding precisely how the unique quality of your work translates into tangible value for the person who is paying for it. That’s where the conversation needs to focus: on the value you can provide to the commissioner in return for the investment you are asking.

The problem is, once you’re involved in a tender process, you’re too late to have that conversation. Most tenders are deliberately designed to “commoditise” a requirement – that is, to specify it in such a way that lots of organisations could all deliver it – so the only place left to compete is price. You need to get in before the tender’s even written to ensure your unique value is part of that requirement. That means moving away from simply reacting to tender opportunities, and instead routinely engaging commissioners, when they aren’t tendering their business, in conversations about the issues they face, and the potential value of solving them.

For a social care service, it might be the value of avoiding a future crisis, or a long-term cost that you can help them save. Examples and case studies are useful in building their confidence that you can do what you say you’ll do. But in the face of severe budget cuts, you’ll increasingly need to have statistical evidence to support your claims. That’s what the commissioner will need if she’s going to make the case internally for investing more with you than they could get away with elsewhere.

That financial case is the first ingredient. If the numbers don’t stack up, it’s unlikely you’ll get any further. The second ingredient is confidence, specifically the commissioner’s confidence in you, that you understand the problem, that you can deliver what they need, and that you won’t let them down.

Both of those: case and confidence, are important, but alone they’re not enough. Many’s the client I’ve spoken with who has presented a commissioner with a clear return on investment, only to see the contract still go to the cut-price alternative. Which is why the third ingredient, emotional connection, is the most important of all.

It’s easy to forget but it remains true, that most people who go into public service do so because they want to make a positive difference. You need them to see, and to feel at an emotional level, that you can help them make that difference, and the best way to do that is to start at the top.

Most councils and councillors want to get out and listen to people in their communities, and lots of councils have dedicated sessions to hear from people who’ve experienced real difficulties. This is your opportunity to start forging that connection, to show them how they can make that difference, to impart a visceral experience of what a quality service can achieve for their most vulnerable or disadvantaged constituents.

Back that up with a sound financial case for quality, and give them the confidence that you can deliver it for them, and you might just find you can agree to putting a price on quality.