Module 2 · Live Session Recap

A recap of the July 23 call, for anyone who could not attend.

Week 2 Live Discussion · What the Cohort Covered

A synthesis of the second live discussion, covering how the group sets fees, earns value, and manages client expectations on tight budgets. This summary carries the substance of the full hour.

Meeting RecordingFull July 23 discussion · ~72 min
July 23, 2026~5 minute readLive Discussion · Module 2
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What Came Out of the Feedback

One number split the group in half

The Week 2 survey covered three questions. The group agreed on two of them. The third question, a simple calculation for turning cost into a target fee, split the room almost evenly.

Half the group added 20% to cost, and landed on $408,000
The other half divided cost by 0.8, and landed on $425,000
Today's discussion worked out why the two numbers are not the same
A fee built with a 20% markup on cost delivers about 16% profit, not 20%. Firms that price this way give away roughly 3.5 to 4% of every fee, without ever deciding to.

The Standard the Program Builds Toward

Markup and margin are not the same number

Justin opened with the numbers: a project that costs $340,000 to deliver, with a target profit of 20%. Multiplying cost by 1.2 is markup. Dividing cost by 1 minus the target profit is margin. Only one of the two returns a true 20% profit.

Common InstinctMarkup: cost × 1.2

Feels simple, and it is the first move most people reach for. It also quietly gives away part of the profit target every single time.

The StandardMargin: cost ÷ (1 − 0.2)

The only formula that returns a true 20% profit. $340,000 ÷ 0.8 = $425,000.

Check your own project

Before next week, pull the budget spreadsheet for a project you run and confirm the profit built into the fee is the profit you actually meant to set.

The same shift in thinking applies to how the group measures progress once a project is underway.

Finished work earns value

Not hours worked, and not how busy the week felt. Only work that is done and defensible moves the needle.

Outcomes, not activity

A task is either finished or it is not. Partial progress does not go on an invoice.

Bill what you can prove

If a client pushes back and asks to see it, the finished work needs to be there to show them.

Two Scenarios From Today

When the fee does not start with you

Most of the live discussion worked through situations the cohort brought to the table themselves.

Scenario 1The fee was set before the PM ever saw the project

Some fees come from a percent of construction cost, agreed before a PM builds a staffing plan. The group's answer: take the fee, subtract the target profit, and what is left is the real budget for effort. Then look for real ways to hit it, the right people on the right tasks, and a clear line between what the scope requires and what would just be nice to have.

Scenario 2115 of 200 budgeted hours are spent, and the client has not signed off

Spending 55% of the hours does not mean 55% of the value is earned. The group's answer: bill what is finished and defensible, not what the calendar says. A real work plan, broken into weighted tasks ahead of time, is what turns “we are probably about halfway done” into a number a PM can stand behind.

The tension under both scenarios is the one from Week 1. Naming a hard number, to a client or to yourself, still feels like a confrontation. It is not. It is stewardship.

What Comes Next

One assignment, and a schedule update

  • 1
    Check your own project’s mathBefore next week, confirm the fee on a project you run was actually set using margin, not markup.
  • 2
    New content releases tomorrowModule 3 covers the fee to cash process, how money moves from contracted backlog to cash in hand, and where a PM’s actions speed that up.
  • 3
    Submit your Week 3 feedback surveyDue Tuesday, 5 PM ET, same as every week. This week’s survey adds one new question, collecting topics for the upcoming BST technical sessions.
  • 4
    Watch for a schedule updateTwo new sessions on BST, led by Nick, are being added between weeks 4 and 5, and again between weeks 8 and 9. All twelve weeks of PM content stay in place; these are additions, not swaps.