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May 02, 2007

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Ed Kless

Great post!

In addition, you can't give A-level service to a D-level customer. They (the Ds) in incapable of accepting it. In fact, I believe you are doing a disservice (and it may even be immoral) to your A-level customers by keeping the Ds around.

Phil Gott

Another interesting post Michelle. One point that needs to be emphasised though is that clients should be involved in choosing the level of service they want to receive (and are willing to pay for). Following your airplane analogy, the customer gets to choose whether to fly first, club or economy class.

This means that professionals need to have an open and sophisticated conversation with clients to assess their requirements and manage their expectations. This also provides an excellent opportunity to discuss value-based billing which I know you support.

Whilst firms are increasingly categorising their clients as you suggest, I’m not convinced that they are all holding open discussions with their clients as part of the process. This risks failing to meet the expectations (of the “bronze clients”) who might be receiving a service that is average at best. In turn, this could well damage the firm’s reputation.

Keep up the good work with the blog!

Michelle Golden

Phil,
Thank you for your comment. You are exactly right. It is not okay for a firm to decide how someone "chooses to fly"! This is such an important point!

At VeraSage, we do a LOT with this airplane analogy--the analogy is very powerful and multi-faceted. A common misconception professionals have when they first see it, though, is that THEY get to choose where clients sit. In my opinion, this is altogether WRONG. As you articulate so eloquently, the CLIENT should decide where he or she sits.

However, it is YOUR plane so you can decide how many seats in each "section" you can offer and support (hint: fewer seats in first class because the level of care and contact is much higher).

Here's the catch. In order to have the kinds of conversations with clients that you describe, and the type of conversations that lead to decisions about where a client may sit, the firm HAS to get to pricing, right? Whether it's a fixed price at varying levels of "service" or whether it is *ahem* a higher hourly rate (readers of my blog certainly know how I feel about hourly billing) for premium levels of service, the bottom line is that a customer is an uniformed buyer until this part of the conversation is had.

I completely ignored the pricing aspect of this discussion (not by intent) within my post but the assumptions about price impact and the requisite conversations needed to reach this level of understanding are paramount.

In fact, I can see that it may look even more like I don't regard the client's choice of "where to sit" when I suggest that THE FIRM conduct a client evaluation! Yikes. But those who read my article on evaluating clients will find that I do have several value pricing elements within the considerations.

I appreciate your post and your taking issue with my approach. You made a valid and important point.

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