The collaboration tax in freelance projects

The price of freelance work goes up as you involve more people from your company in their work. Call it the “collaboration tax.”

The best analogy I can give is this: I once hired a carpenter to rebuild the porch on my house. I wanted to see if I could get a better price than he quoted. “What if I help you?” I asked. “Then I have to increase the price by 50%,” he replied with a smile.

Involving more people doesn’t always make things better or easier. It’s the paradox of the mythical man-month all over again. More people require more communication, which creates more work.

Freelance projects and the collaboration tax

I’m a freelance writer and editor. In a simple project, you hire me, say, to ghost write an article or a book for you, or to edit your book. I figure out how many hours it’s going to take and quote you a project price based on that.

Once more than one person needs to weigh in on the results of my work, the complexity goes up.

• Low complexity
  • one writer, one editor.
• Moderate complexity
  • two cowriters, one editor
  • writer who subcontracts some work to other writers or illustrators, one editor
  • one writer, feedback from two editors
  • one writer, one editor, but at end of process, someone else weighs in with a “final say”
• High complexity
  • three or more writers
  • one writer, team of people providing feedback
  • multiple writers, multiple editors

The complexity comes with a cost: the need to communicate and find common ground. That takes time. And time costs money.

Note that the value of the work rarely goes up when more people are involved at the client. Only the cost goes up.

I’ve cowritten a book with two other authors. It was a nightmare. We had a very hard time agreeing on important elements of the book and keeping the style consistent.

I’ve developed copy and taglines for a CMO and his company. It took five times the effort that I expected. I kept coming up with solutions that the CMO liked, but that the other executives rejected for one reason or another.

If I quote by the project on projects like these, I need to build in extra cost for collaboration time, communication, and rework. The premium might be 25 to 50%. This is the collaboration tax.

If you are a freelancer who quotes by the hour instead, you’re protected, at least in theory. But the client ends up shocked by how the price keeps going up.

It can get even worse with multiple contractors. I’ve worked with lawyers who needed to consult with other lawyers who were specialists. You end up paying not only for the work of each lawyer, but double-time for their meetings with each other. That really adds up. Ouch.

What freelancers can do to reduce the collaboration tax

I prefer for clients to pay me for creative work, not for hassles. So I try to find ways to reduce the effort involved in coordination.

Here are a few ideas that worked:

• Plan carefully first. It’s way cheaper to collaborate on a plan than on an actual project. If everyone involved agrees on the roadmap ahead of time, the freelancer can then create according to that roadmap. (Of course, this depends on people sticking as closely as possible to the original plan; if plans shift in major ways, you’re back to the same collaboration tax as before.)
• Gather feedback synchronously. I ghost wrote a book for two coauthors. I wrote it in Google Docs, and they provided the feedback, including commenting on each other’s comments. This made it far more likely that I’d get a single coherent set of comments for my next revision.

What clients can do to reduce the collaboration tax

In addition to planning carefully and requesting synchronous feedback, a client hiring a freelance writer or other freelancer can take actions like these to reduce the cost of collaboration:

• Reduce the number of reviewers. Remove people from the review list until the minimum possible number of reviewers remain. One or two reviewers is ideal.
• Gather reviewers’ feedback. Choose one individual whose job is to combine all reviewer comments into a single document that the freelancer can respond to. Resolve contradictory advice in this document so the freelancer has a clear directive.
• Manage “final feedback” reviews. It’s typical for senior executives or other VIPs to insist on a final review. The person at the client who manages the process should advise such reviewers that the result is nearly final and, short of finding a major problem, final reviewers should keep their comments as limited as possible.
• Hire experienced freelancers. An inexperienced freelancer ends up getting ping-ponged between different client perspectives (a phenomenon called “thrashing”). An experienced freelancer recognizes the danger and strives to conceive of a more sophisticated solution that will satisfy apparently contradictory perspectives. The experienced freelancer costs more per hour, but takes less time to arrive at a successful conclusion, which both increases quality and decreases the overall cost.

Don’t ignore the collaboration tax

Freelancers who ignore the collaboration tax end up doing not just more work, but more political bullshit work and less creative work. So if you freelance, don’t ignore the cost of collaboration. Get processes and plans settled up front so you can make better estimates and spend more time on the tasks you’re uniquely qualified to do.

If you hire a freelancer, be aware of the collaboration tax in your sourcing. It’s your own fault if you design a labor-intensive process that generates lots of contradictory feedback and end up paying for it. Work with the freelancer to create a process where more of your contractor money goes to pay for creative work and less for the overhead of communication and conflict resolution.

Freelancers like me want to get paid to do the work we’re good at. So give us a break. Well managed processes are cheaper and yield better results.