I’m obsessed with helping firms of accountants run a better business – this means growing your firm’s profits. This means keeping all your valuable clients and winning new valuable clients.

Are you serious about growing profits?

Let’s see…

Back in 2008 I ran a workshop for all the partners in the firms of accountants I consult with. The workshop  – held in a lovely little hotel by the river Derwent – was focussed on challenging these firms on the way they deliver value for money for their business owner customers.

Looking back, what stood out as the shining insight of the day was the need to establish crystal clarity on what your business owner customers’ expectations are. It still occupies my mind to this day because there’s so much to be gained from this important insight if you only put it to work in your firm. It’s worth revisiting now…

This blog is about your firm’s processes for capturing, recording and exceeding your clients’ expectations.
Why are expectations so important?

1. Because only your clients can determine whether they receive value for money or not
2. The value they receive is determined by the expectations they have before you start

Whether your client’s expectations are high or low, if you under-perform then value is below their expectations. This situation will prompt your client to question whether your price is too high and maybe even choose another accountant.

If their expectations are met (not exceeded, just met) then they might feel OK about the value received. They may not question the price, they may not consider other accountancy offers. But they might! They might consider alternative firm’s because you only just delivered on their expectations. You were nothing special. However…

…when you exceed their expectations (whether they are high or low)they feel as though they received a wonderful deal and happily use you again and even recommend you to others. It’s unlikely other firms will get a look in and so you’ll secure their business for another year and lock in the GRF and their goodwill value to your firm. You keep them. You also increase the chances of them recommending you to other business owners and as a result grow your firms fees and profits.

Jan Carlson in his book (moments of truth) about his transformation of Scandinavian Airlines captured this insight best when he described three customer experiences:

1. Miserable – expectations were not met
2. Neutral – expectations were met
3. Magical – expectations were exceeded

IMPORTANT: Jan Carlson took over the reins of Scandinavian Air at a time when the airline was suffering an $8 million loss and turned it around to a $71 million profit within one year. You interested in expectations now?

Here’s the rub…

If you don’t know what your clients’ expectations are how can you even think you can give them a magical experience?

So what is your firm’s process for identifying, capturing and recording your clients’ expectations every year?
Focussing on your A-class clients first, does this help?

1. Add ‘expectations for next year’ to your pre-year-end client meeting agenda (add it to your post year-end meeting if you aren’t having pre-year end meetings)

2. And then have a discussion about the 9 things David Maister et al suggests you talk about in the book ‘The Trusted Advisor’ in your pre-year-end meetings

   a. Clearly articulate what you will and will not do
   b. Clearly articulate what the client will and will not do
   c.  Define the boundaries of the analyses you will perform
   d. Check with the client about areas and people with whom the client does not want you to be involved
   e. Identify precise working arrangements
   f. Agree on methods and frequency of communicating
   g. Decide who should get which reports, how often those reports will be delivered and how they will be used
   h. Decide what milestones and progress reviews are needed
   i. Decide how success will be measured, both during and at the end of the process

OK I know this looks onerous, but…

…continue with no expectations processes and you’ll continue to run the risk of losing valuable clients because you do not exceed their expectations. You’ll also continue to be challenged on price. And you’ll be missing out on positive word-of-mouth recommendations to grow your firm.

Decisions, decisions!

IMPORTANT: According to Jan Carlson, Moments of Truth are those critical times when a customer forms an impression of you, deciding whether your offerings and their standards see eye-to-eye.  The moment you start discussing expectations is a jugular moment of truth don’t you think?

Time to install your ‘expectations for next year’ processes?

Let me know your reaction and thoughts on this important subject will you?

Paul Shrimpling

www.remarkablepractice.com

…then look at raising the eyebrows of your clients!

It’s not surprising to discover the three most effective ways of getting new clients (based on the successes I’ve seen across 19 firms in 2009) are:

1. Referrals from existing clients

2. Referrals from influencers (bankers, solicitors, IFA’s etc)

3. Events

The number one source being referrals from existing clients. And if it’s not the number one source in your firm it should be!

Why?

Because only when you get referrals from your clients do you know they are truly happy – and a very well researched article at wikipedia agrees. The article suggests the willingness of your clients to refer is the only true judge of client loyalty!

Also…

When you do everything possible to encourage client loyalty they are more likely to stay – and I’m guessing the last thing you want is to be finding new clients whilst watching old established clients leave your firm?

So how do you raise the eyebrows of your clients (in a good way)?

Simply exceed your clients’ expectations!

The better you get at managing client expectations and exceeding their expectations the more likely you’ll see them raise their eyebrows. And the more likely you are to keep all your clients and all your existing fees. Plus your clients are more likely to refer you to others they know.

No rocket science here I’m afraid – BUT WHY IS IT RARELY APPLIED BY ACCOUNTANCY FIRMS?

Mainly because their definition of accountancy does not clearly focus on the expectations of clients. Instead firms focus on getting the technical work done.

And yes the technical work must get done, and get done well.

However the stuff your A-class clients value the most is the interaction they have with you, their accountant. The quality of the relationship you have with your clients makes a massive difference! Have you ever asked them what their expectations are around speed of response, speed of delivery, interpretation and guidance, how often they’d like to hear from you?

Interpretation, explanation, guidance and support is what matters most to your clients – not the technical detail of a set of accounts.

OK, I know!…

                  …you’ve heard it all before…

                                                           …It’s just that I’m stunned by the lack of commitment towards processes that manage, improve and stimulate the relationship between most accountancy firms and their clients.

Whenever the firms I work with apply some science to staying in touch with their most valuable clients they amazingly hang on to clients they would otherwise have lost. PLUS they start a flow of referrals that previously seemed unlikely (if not impossible)! A conversation yesterday included this comment from a managing partner we’ve been working with:

“One of my clients now realises I am serious about getting new business through recommendations from him (because I’ve asked him several times in the last 6 months). He has recently introduced me to two valuable and very warm prospects.”

You don’t say!

What am I advocating?

Create processes to manage, improve and stimulate a better relationship between you and your clients (including one linked to client expectations). Coupled with processes asking for referrals and recommendations. Simple stuff.

Vive la revolution!!!

1. The starting point I suggest is improve the relationship – improve your conversations:

Work out what matters most to your clients and then deliver on it.

1. Ask them what matters most. And I suggest you work on discussing three aspects of their experience of working with your firm – timing expectations – and technical work expectations – and relationship expectations

2. Capture client expectaions. Yes write them down! And then share them with your team and work out how you at least deliver on their expectations – although you might be wise to do what you can to exceed their expectations slightly (start by only focussing on your top 20% clients to make this project more achievable)

3. Do the work necessary to exceed their expectations

No rocket science. Just simple, solid process improvement aimed at raising your clients’ eyebrows (in a good way).

2. Next. Work out several (at least five) processes to capture recommendations from your clients and put them to work systematically  

Customer feedback processes should be a source of recommendations. Events too can generate leads (we got 17 from a recent event in Lancashire). LinkedIn can be tool that generates referrals too. Your client contact programme can and should also generate referrals. What about a wow process for new clients with a focus on getting referrals early. And what about joint lunches with clients and bank managers? More on referrals processes in a future article.

How else can accountants ‘raise the eybrows’ of their clients? Feel free to comment on this article and ask any questions that bug you or you want to resolve.

Happy hunting!

Paul Shrimpling

PS You can see this article on AccountingWeb http://www.accountingweb.co.uk/topic/practice/how-grow-your-fees-2010/399281