2025-07-09T15:53:26Z

Clients generally want a return on their investment, and (by the time they're talking to you about it), they tend to have an idea (irrespective of accuracy) around what it's worth.

Create a Monte Carlo model that simulates the product recovering value. Use it to derive a probability distribution for the valuation.

Discount the valuation to zero (or whatever compromised value you want to discount it to) after the deadline elapses.

Dorian Taylor

Establishing the value of the outcome should be part of the discovery process.

Get the value of the outcome out into the open.

If you have a clear idea of at least the contours of what the projected outcome is worth, it's much, much easier to realistically scope the project.

It is much, much easier (and thus much quicker) to estimate the value of a completed project than the cost of completing it.

Process Model Issues

Respond to these questions instead with "if you can tell me the gross value, I can give you a curve that represents the size of the return at different probabilities."

Use the discounted cash flow method to get the appropriately discounted net present value of the work product.

What about a hard, exogenous deadline?

What about depreciation over the time it takes to complete the project?

What if the client doesn't want to be forthcoming about the value of the outcome?

What if the value of the outcome is genuinely unknown?