Greg Kyte is a CPA and comedian. He teaches ethics and fraud courses for accountants with a comedic edge at ComedyCPE.com. He is also the G. Robert Newhart Non-Value-Added Fellow at Versage Institute.
The Real Context of Value
- What is the most important thing you can share about pricing?
- You need to price your services like you know magic.
- The Labor Theory of Value says that the value of something is equal to the materials and labor it takes to create it. It is a fallacy.
- Dan Ariely, the author of Predictably Irrational, says you have to realize that people will determine the value of your product/service by inserting their context.
- All value is subjective.
- When people have no context for the work you are doing, they will create a context for themselves.
- You must talk to your customer upfront about what they need/want from a transaction before doing the work.
- Collect the money upfront.
- People are afraid of talking to their customers.
- What is the funniest thing about value pricing?
- When accountants talk to Greg about upfront payment plans, they worry about negative accounts receivable.
- According to accounting theory, it is unearned revenue.
- What is the funniest thing about hourly billing?
- As an accountant in a firm, when you have to ask yourself, “Do I stop my time billing software when I have to go to the restroom?”
- It raises an ethical question about going pee-pee.
- What if it your bathroom visit was longer than 6 minutes?
Value Pricing in Accounting
- What is the state of value pricing in the accounting profession?
- By and large, the average person in the accounting profession would say, “That seems like a great thing, but we cannot do it.”
- The billable hour has too much inertia.
- Joe Manzelli was a partner in a firm and was left alone to do his value pricing “thing”.
- His realization rates were off the charts compared to his colleagues.
- Ask your customers if they like how you are billing.
- Do some experiments; do not be a weenie!
- Some people are angry about value pricing and seem to have a weird idea of what it is.
- The fear of people “shopping” accountants is one of the arguments against value pricing.
- Accountants are not selling a commodity.
- Everyone hates the billable hour.
- The customer has no idea what the bill is going to be.
- The firm is “billing and ducking.”
- The employee feels his subjective well-being is being torn down.
- What was your first exposure to value pricing?
- In a previous life, Greg was a middle school math teacher.
- He knew he was 10 years behind the other CPAs.
- He was working hard to catch up with everyone.
- He read Pricing on Purpose by Ron Baker in the Journal of Accountancy.
- Greg was shocked to learn it was even a possibility.
- He hated the environment in which he worked.
- What is the funniest thing the IRS did for the 2014 tax year?
- They were dealing with budget cuts, and the Affordable Care Act added workload.
- They understaffed their phone lines.
- On the website, the IRS posted that a caller might be subject to a “courtesy disconnect“.
- Greg went to a one-hour presentation for the Affordable Care Act to learn how to calculate the credit.
- Even though he learned how to calculate it, he also knew he would never be able to remember the complex calculation.
Creating Comedy About Ethics
- Can you explain the irony between comedy and ethics?
- The things that are the driest and most mundane are the easiest source material.
- He looks at ethics per the Code of Professional Conduct from the American Institute of CPAs.
- Any legal document is easy to pick apart.
- There is a code that says that there is an ethical responsibility to follow the Code of Professional Conduct.
- Ethic-hacks (similar to Lifehack) combine behavioral psychology and economics to increase the level of professional ethics.
- Cheating is contagious.
- What is one of your best stories about creating value for a customer?
- John Shaver from Aries Technology Group hired him to do a funny video to explain fixed pricing called Bob's Barbecue.
- Performing comedy in a club or during a CE presentation, when all cylinders are hitting, and everyone is having a great time. He is creating value for the participants as well as for himself.
About Greg Kyte
- Website: GregKyte.com
- Twitter: @GregKyte
- Co-host of ThriveCast with Jason Blumer
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