Our clients are starting to realize how fast AI can generate work, and they are demanding faster turnaround times and lower prices because they assume our costs have dropped to zero. How do we update our business strategy on the V/TO to address these shifting customer expectations without destroying our margins?

Question

Tyler Smith · Accepted Answer

You must shift your business model from selling hours and outputs to selling outcomes and expertise. When clients know AI can generate a report in seconds, they will no longer pay for the report. They will only pay for the strategic interpretation and the results that the report drives. This requires a fundamental shift in your positioning on the V/TO. Start by redefining your target market and your core focus to align with clients who value strategic partnership over raw volume. In your Level 10 Meetings, run your current pricing structure through the IDS process. If you are still pricing based on time and materials, you are penalizing your own efficiency. Move toward value based pricing models where your revenue is tied to the business value you create rather than the time you spend. Additionally, prioritize using AI to increase employee productivity so you can deliver the baseline work faster, meeting client demands for speed without increasing your internal operational costs. By freeing your employees from low value execution tasks, they can spend their time delivering the high level advisory work that clients are actually willing to pay a premium for. This strategy preserves your margins and ensures your team remains an indispensable complement to the technology your clients are trying to leverage themselves.