Most firms think they have a pricing problem. And they do, but not in the way they think.
The common assumption is that firms are underpricing deliverables, underestimating hours or struggling to keep up with the shift from billable hours to value pricing. But the deeper issue is that firms are still pricing the output while quietly giving away the experience surrounding it.
That matters because clients don’t just buy a tax return, an audit or a financial statement. They buy access, responsiveness, interpretation, reassurance and confidence. They buy the relationship, even if the invoice is centered on deliverables.
Not All Time Carries the Same Value
One of the biggest flaws in legacy pricing models is the assumption that all time is created equal. It’s not!
Fifteen minutes spent formatting a file is not the same as 15 minutes spent calming a nervous client, spotting a risk before it becomes a problem or helping a business owner make a better decision. But firms often treat both the same because traditional systems are built to count time, not understand the true value of the service itself.
This takes us back to an inherently flawed system, and the fact that firms have been trying to capture time in an environment that makes accurate time capture next to impossible.
That blind spot becomes even more obvious when communication enters the picture. In fact, Laurel’s State of Work Report found that:
49.4% of the business day is spent on communication and coordination work
That means nearly half the day is going toward the conversations, check-ins, emails, meetings and touchpoints that move work forward and shape the client experience. Yet, a lot of that time is underweighted, unpriced or ignored altogether.
The Relationship Work is Real Work
Client-facing time often carries enormous value, but because it doesn’t always look like production, it gets treated as overhead. That’s a mistake, especially when you consider that Laurel found that:
50% percent of meetings involve external client interactions, and those meetings consume more time per session than internal meetings do
In other words, a meaningful share of professional time is being spent directly with clients, but firms still tend to anchor pricing around the thing produced, not the trust built around it. A major flaw in overall system design.
It’s important to understand how much time is actually client contact versus behind-the-scenes work because good client meetings have a bigger impact than simply creating the deliverable.
This is a critical pricing insight. If the relationship is what drives retention, trust, upsell opportunities and perceived value, then it can’t keep being treated like free labor wrapped around the “real” work.
Automation Changes the Math, But Not the Value
AI makes this even harder to ignore. As automation reduces the time it takes to complete certain technical tasks, firms can no longer rely on effort alone to justify price. Some firm leaders still instinctively compare this year’s work to last year’s hours, but that logic starts to fall apart fast in an AI-enabled environment.
Historical time is becoming less relevant because AI is changing the nature of the work and the workflows that surround it. But faster delivery doesn’t automatically mean lower value. AI-supported work can produce a more sophisticated deliverable, meaning that the hour itself may actually be worth more, not less.
AI improves quality, not just velocity, which means firms need a more nuanced way to think about pricing than simply tying fees to time spent. They need pricing based on judgment, access, context, communication and confidence because this is the part that’s being underpriced today.
What Firms Need to Price Now
Once firms can actually see how work happens, pricing starts to look different. Leaders can begin to distinguish between commodity execution and high-value interaction. They can see where relationship-heavy work is happening, where communication is driving outcomes and where advisory value is being delivered even when it doesn’t show up as a neat line item on an invoice.
And that’s the shift. Firms aren’t just underpricing services; they’re underpricing what clients actually value most. Until that changes, margins will continue to leak through all the invisible, high-impact work that keeps clients loyal, confident and coming back.
