Ever have a BFO? A Blinding Flash of the Obvious? It's my sincerest hope that this becomes one for many readers. It was for me a couple years ago.
What are the reasons professionals think they lose or upset clients?
- not "proactive" enough
- poor service
- relationship changed/deteriorated (chemistry)
Sure, those are all valid complaints. And the REAL, underlying problem, for every single one of these, is that the customer expected to get something different from what they got.
I'll bottom-line it: Clients name these factors when conversations that should have occurred, did not.
You could call it lack of proactivity or lack of service. It's lack of setting and meeting expectations(adjusting when needed). Think of it as "scope" for the soft-stuff.
There is a pretty easy solution. It involves 3 steps:
- Listen/ask/listen more
- Mutually establish expectations (written is good)
- Meet them
If something usurps #3, conduct a conversation as early as possible to alter #2. If you cannot catch it in time, apologize profusely and fix it (without assigning blame, please).
To improve profitability, increase prices, retain clients, have happier team members (who know what expectations to meet), and solve most "service" related problems, apply the magic 3-step system above. It will change your firm forever. I promise.
If you want to see what inspired this advice, read Rick Telberg's post Finance Execs See Service Lagging at CPA Firms (excerpt below) and think about it relative to what I've written above.
What might cause the client to switch auditors?
Bay Street Group's recent studies of accountant-client relationships...got a surprising dichotomy of answers. CPAs tended to say one thing, while CFOs said another. Surprised?
Public practicing accountants (47%) seem to be under the impression that they lose clients due to "price, fees, costs, budgets and affordability."
But finance managers and CFOs have a different take. A solid majority (79%) point to "poor client service and lack of attentiveness." Fees and costs ran a significant second, at 66 percent.
Back on the CPA-firm side of the question, service was the third most commonly perceived reason for expected loss of clientele....
There's something wrong when twice as many CFOs as CPAs see service as the determining factor in client longevity. That might mean that a lot of CPAs are failing to offer what corporate accountants want....
The other reasons CPAs fear they might lose a client were distantly less common. Twenty percent thought "bad personal chemistry" might be the problem; 19 percent recognized that they might not be proactive enough; 17 percent figured they'll beat the client to the punch by firing them for business reasons; and 11 percent worried that the client might take the function in-house.
The third most common gripe among financial officers was "not getting enough time with CPA firm's best people" (again, a matter of service and attention) at a significant 38 percent. Bad chemistry followed next, at 34 percent. Lack of proactive advice came close, at 33 percent. Twenty-two percent said they might need new or different services.
Every time I see these "reasons" hashed out, again and again in study after study, I just want to shout the expectation mantra. It really works.
No matter how small the job or client, the "scope" of these issues is every bit as important to the customer (as demonstrated by defection and complaints) as the scope for the technical aspect of services.
Clarify your buyers' price expectations and parameters and use change orders as needed (better to identify fee sensitivity on the front end!). Ask about their preferences for communication frequency, delivery, staffing, level of "extra" advice/consulting expected, and so forth.
You will be shocked at how much less they expect than what you think they will "require." Either way, it gets everything on the table. Document it in the client's file and in your contact management system, if you use one.
Wouldn't you appreciate the same when you buy professional services?
So, was this a BFO?