Skip to content

Guides

Why we stopped billing by the hour

With AI tools, much of the code we used to write by hand now comes out in minutes. If we billed by the hour, every productivity gain would make us bill less. That’s why we decided to stop selling hours and start selling results.

By Lency VitolaDelivery Manager at Korbex

4 min read

A year ago, an integration like the ones we now deliver in an afternoon took us a week. With AI tools in our workflow, much of the code we used to write by hand now comes out in minutes.

That’s good news for any client. But if we billed by the hour, it would be bad news for us: every productivity gain would make us bill less. That’s why at Korbex we decided to stop selling hours and start selling results.

The problem with billing by the hour

The hourly model puts the agency and the client on opposite sides. The client wants a solution fast and cheap; the agency earns more the longer it takes. Nobody does it on purpose, but incentives matter:

  • Efficiency gets punished. If we automate a task, we bill less for it.
  • The client buys uncertainty. They know what an hour costs, not what the project will cost.
  • Effort gets measured, not impact. A timesheet doesn’t say whether the client’s business got better.

With AI, this becomes unsustainable. When build time drops to a fraction, billing for time stops reflecting the value we deliver.

What AI doesn’t make cheaper

Writing code became cheap. What’s still hard, and where the real value is, is everything around the code:

  • Understanding the business. Knowing which problem is worth solving and which isn’t.
  • Deciding what to build. Choosing the right architecture, integrations and boundaries from the start.
  • Showing up in production. Making the solution work on Monday at 8 a.m., not just in the demo.

An AI can generate a thousand lines in seconds. It can’t sit down with an operations manager to understand why their team loses two days a month reconciling invoices. That’s still our job.

How we work now: pricing by results

Instead of selling hours, we agree with the client on a measurable result and a price for achieving it. We call it Results as a Service.

  1. 01

    We define the result together

    For example: cutting customer response time in half, or automating the monthly reconciliation.

  2. 02

    We agree on how to measure it

    An indicator the client already understands and can verify.

  3. 03

    We set the price for the result

    Not for the time it takes us to get there.

  4. 04

    We deliver and measure

    If the result doesn’t come, the risk is ours.

For the client, the change is concrete:

By the hourBy results
When they know the priceAt the endFrom the start
Who carries the riskThe clientKorbex
What gets measuredHours workedBusiness impact
If we get more efficientWe earn lessBoth win

What isn’t easy

Pricing by results isn’t magic, and it doesn’t fit everything. It has challenges we’d rather state up front:

  • Not every result is easy to measure. Some projects are exploratory and the goal is to learn, not a number. In those cases we say so and agree on a different arrangement.
  • We take on more risk. That’s why we spend more time at the start understanding the problem before we commit.
  • It takes mutual trust. The client has to share real data so we can measure the impact.

We don’t see it as a downside. It’s the filter that makes us choose well which problems to solve.

Let’s talk about results

The software industry is changing, and the question is no longer how many hours a project costs. It’s what changes in your business once it’s done.

If you have a process that costs you time or money every month, tell us which one. That’s where we start: with the result you want to see.

Frequently asked questions

What does pricing by results mean?

Korbex agrees with the client on a measurable result, like automating the monthly reconciliation, and a price for achieving it, instead of billing for the hours it takes.

What happens if the result isn’t achieved?

The risk is Korbex’s. That’s why we spend more time at the start understanding the problem before committing to a result.

Does it work for every project?

No. For exploratory projects, where the goal is to learn rather than hit a number, we say so up front and agree on a different arrangement.

Keep reading