Free assessments still consume the company's scarce resources

## Ask what the preliminary work is intended to buy

The customer-development presentation led with ninety-six free preliminary assessments. The number suggested reach, effort and a substantial pool of possible projects. All of those could matter, but the account did not yet explain the commercial model. The assessments cost ₹84 lakh. At the review date, fourteen had led to paid follow-on engagements with ₹36 lakh in fees, while eighty-two had not progressed to paid work. I wanted the company to examine that relationship before treating another large assessment campaign as an obvious route to growth.

Free work can have several legitimate purposes. It may help a customer understand a problem, establish trust, reveal that a project is unsuitable or give the provider knowledge it could not obtain from a distant conversation. Immediate conversion is therefore not the only possible measure of value. The difficulty is that a programme can invoke all of those purposes after the event without having decided which one justified the resources in the first place. Strategy should make the intended purpose clear enough that the company can judge what it has learned.

The commercial sponsor argued that industrial relationships develop slowly. A prospect who had not bought at the review date might return later, and a request for payment at the beginning could prevent a useful relationship from forming. I regarded that as a serious objection to a simplistic conversion calculation. The fourteen follow-on engagements did not establish the eventual value of every assessment. But the possibility of later work did not remove the need to understand the current cost, the use of specialist capacity and the conditions under which continued free work made sense.

An assessment is also not one uniform unit. Some require more specialist time, travel or investigation than others. The company needs an appropriate internal account of the work before comparing its apparent acquisition cost across customer groups. That does not mean making a public profile a detailed costing manual. It means ensuring that management understands what the activity count contains. A larger number can represent broader reach, lighter work or a greater burden on scarce expertise; the count alone cannot tell directors which interpretation is relevant.

My contribution was to ask what kind of customer-development route we intended to operate. Were we offering a bounded introduction that helped both sides decide whether to proceed, or performing substantial project work in the hope that payment would arrive later? Both may be defensible in particular circumstances, but they involve different capabilities and exposures. The business should choose deliberately. Otherwise the word free describes the customer's invoice while concealing the company's actual commitment of people and money.

## Separate the review population from the eventual relationship

The ninety-six assessments formed a defined review population. Fourteen had produced paid follow-on work and eighty-two had not at the cutoff. That last qualification mattered. I did not describe every unconverted assessment as permanently lost, nor did I treat future possibility as revenue already secured. The account needed to preserve both the observed status and the limits of the observation. Without that discipline, one side of the debate could call the programme a failure while another could defend it indefinitely through unspecified future value.

The ₹36 lakh in follow-on fees also required a precise description. It was not profit. Later engagements had their own delivery work and costs, and the preliminary ₹84 lakh did not represent every expense of the customer relationship. Simply subtracting the two figures would not produce a complete financial result. Finance and commercial owners needed to establish the relevant definitions. Strategy's task was to ensure that the comparison used in the decision did not silently move between activity, fees, contribution and enterprise profit as convenient.

The review also had to respect the technical purpose of an assessment. A finding that no suitable project should proceed can be a professionally useful outcome, even if it produces no larger engagement. We should not create pressure to recommend work merely to improve a conversion statistic. That is one reason the programme's commercial evaluation should be connected with, but distinct from, technical judgement. The company needs to understand whether it is learning efficiently without asking the specialists to make every customer look like a viable project.

There is another form of missing information: the opportunities the team could not pursue while doing the preliminary work. I did not invent a quantified lost-profit figure for them. We had not established one. Still, capacity has consequences, and management should examine how the programme fits alongside paid commitments and other development routes. A decision can recognise that opportunity cost exists without pretending that its precise value is known. That is more useful than either ignoring the constraint or assigning a convenient number to make a preferred route appear superior.

I wanted the review to lead to a choice rather than a retrospective argument about who had been right. The historical cost and outcomes should remain visible, but the next question was what route to test or continue. We could narrow the free offer, improve selection, retain it for particular purposes or introduce a paid preliminary stage. Each option could change the customer mix and the work performed. Comparing them required more than applying a different label to the same programme and expecting the economics to improve.

## Test a different route without declaring victory

We approved a paid-scoping trial with six clients and ₹24 lakh of expenditure. It defined a preliminary engagement for which the customer paid before a larger project proposal. Commercial, technical and finance colleagues established the actual scope and terms. The purpose was to examine a different route, not to prove that charging early was universally better. Six participants were a small group, and their willingness to take part could make them unlike customers who preferred the earlier approach. That limitation belonged in the evaluation from the beginning.

The trial also imposed a new demand on us. If the preliminary stage was a paid service, its value and boundaries had to be explained clearly. We could not simply charge for an activity that remained vague because it had previously been offered without a fee. Customers needed to understand what they would receive and what remained outside the engagement. The relevant owners had to ensure that the work was useful on its own terms, rather than merely a disguised entry payment for a larger project that might never become suitable.

The chosen route could lose relationships. Some customers might reasonably prefer another provider or decide that an assessment was not worth buying at that stage. I did not portray those customers as less serious merely because they declined our proposition. Their response was evidence about the market and the offer, not a character judgement. The company needed to decide which relationships it could serve well and economically, while retaining room to learn from a trial that might require revision or abandonment.

Directors can ask what the acquisition programme is intended to achieve, how its population is defined and whether its cost and follow-on results are described consistently. They can examine whether commercial incentives preserve technical judgement and whether the next experiment has a useful decision purpose. Those questions are more productive than demanding either a maximum activity count or an immediate return from every introductory conversation. A service business grows through relationships, but those relationships still require a deliberate account of the resources invested in them.

The review did not settle the superiority of paid scoping. It gave us a bounded way to examine another proposition while retaining the history of the free-assessment route. That is the leadership lesson I would preserve. Unpaid work can be a worthwhile investment, but it should be chosen and reviewed as an investment. The company owes itself an explanation of what the work is intended to buy, what the evidence currently shows and which conclusion remains open, rather than allowing a generous offer to become an unexamined operating habit.