What’s Next?

/in , , /by

Perhaps one of the most telling characteristics of a successful business owner is the “what’s next” attitude. The understanding that you can’t just sit back and enjoy the spurt of growth you happen to be experiencing right now; the knowledge that unless you’re always moving forward, you’ll soon be moving backward.

So how to move forward? Well certainly one important step is understanding how your clients’ needs are changing and figuring out what you can do to help them. Developing the right services and knowing how to take them to the market is a challenge many firms struggle with; consider the following concrete action steps to make this challenge a little less daunting.
Read more

Setting Realistic, Achievable Growth Goals

/in , , /by

With summer here, many firms are planning retreats beginning to set growth goals for next year. It’s the perfect time re-think your goal-setting process. Don’t just think in terms of acquiring new clients when setting target numbers; it’s important to evaluate all factors that will contribute to your final growth goal.

  1. Average Useful Life of Clients: From mergers and acquisitions to changes in management — there are a number of factors that will lead to lost clients. Every client has an average useful life cycle. If your firm’s average is ten years, that means on average your firm will lose 10% of your clients every year. If your firm’s average useful life is 15 years, you can expect to lose 6.7% of your clients per year.
  2. One-Time Projects: You should also consider the amount of one-time project work your firm does in one year. Typically this averages 10-20% of a firm’s total volume.
  3. Net Growth: The net growth you want to achieve this year.

After evaluating these three factors, you can determine your growth goal. For example, if you have an average client life of 10 years, 10% of your revenue is one-time projects, and you want to grow by 10% next year, you really need to generate 30% of gross new business to achieve your 10% new growth goal.

As you can imagine, it takes a lot more activity to generate 30% gross new business than it does 10%. So it might be helpful to break down your goal and determine exactly what you’ll need to do to realize it.

  • How many new clients will your firm need to secure?
  • How much additional work to current clients will you need to sell?
  • How much of a price increase will you need to consider?

When you actively define you growth goals with these three components in mind you can easily assess how realistic or aggressive your goal is. Tracking each of these on a quarterly basis will give you the ability to measure how you are doing against your overall goal. If one of them is lagging, you can increase activity within that component or adjust to make up the difference another way.

Be realistic when setting goals. Make sure your firm can generate enough activity — and that you have enough money budgeted in your growth plan — to achieve your goal.

Celebrate!

/in , , /by

It’s that time of year — holiday parties, events, open houses — likely you’re hosting at least one and attending a few. And while we aren’t in favor of commercializing the holidays, it’s the plain truth that these events can be opportunities to interact with clients, prospects, referral sources and others who influence your success. Here are some ideas to ensure your holiday celebrations lead to celebrations of your success in 2012:

  • Before your firm’s annual event, pull your people together and share the invitation/RSVP list. Encourage your staff to identify who they want to make sure they speak with and to be proactive about seeking out those people at the event.
  • Remind your people not to cluster together in large groups at your event or any other. It’s not very inviting and limits your ability to interact with others.
  • Review your firm’s 30-second speech or key branding talking points. You and your staff will likely be meeting new people at holiday events; now is the time to build a consistent brand image for your firm so that future marketing efforts are successful.
  • Share some ideas for how to follow up with contacts your people make during holiday events when the situation warrants follow-up. Activities could include an invitation to an industry event, a personal note attached to an article or newsletter, a phone call to set up lunch, or simply a nice-to-see-you email.

Simple Tools

/in , , /by

Accountability. The word alone can conjure negative feelings of getting in trouble. Consequences. Same thing. But without accountability — and yes, maybe even consequences — business development activity in a professional services firm is sporadic and results are unpredictable. So how can you start to integrate accountability into a culture that doesn’t historically embrace the concept?

It isn’t as hard as you might think. Four simple tools — and how you apply them — can begin the process:

1. Annually — set the right growth goal, determine what it will really take to reach the goal and whether that’s feasible, and determine where your growth will come from.
2.Semi-annually — measure your billing results using the same parameters you did in setting your goal to determine if you need to step it up half way through the year and how to set your goal going forward at year-end.
3.Quarterly — review the referrals given and received by your firm for each referral source to assess whether you’re networking with the right people and effectively implementing this valuable lead generation tactic.
4.Monthly — analyze your sales pipeline to determine if you are generating enough leads and working opportunities to move them through the sales cycle.

Simple tools — but, like a whetstone, it’s all in how you use them that will determine your success. Don’t just produce the reports; hold regular business development meetings with all who have responsibility for growth, ask them to report status of results and activity, and watch as eventually accountability starts to work its magic. Activities are implemented when people said they would be, your people commit to building their skills so they can be more effective, and growth results will follow.

All from four simple tools.

Knowing When to Stand Firm on Fees

/in , , /by

With year end work approaching and tax season on its heels, you may find yourself in a conundrum: Good clients who really like working with your firm, love your service and think your fees are fair that just won’t be able to pay your standard fees this year. What should you do when clients ask for a fee reduction?

Start by identifying the A clients you want to invest in. When you know the clients for which, should the issue arise, you are willing to make fee concessions you’re more prepared when approached. Be ready with a plan to talk with clients so you are not taken by surprise if they ask.

Don’t discount the fees of a D client in bad times. You’ll only perpetuate the pain going forward. Be willing to let some clients go.

When a client asks about reduced fees, first explore changes in scope that can impact the total fee. Will a review be ok for a year or two vs. an audit? Can you do a collateral only audit vs. a full scope engagement? Can you get clients to do more of the work so you invest less time–like assigning a client’s employee to the audit team full-time for the duration of the fieldwork to be the “go-fer” in finding information or people, and to get questions answered without the CPAs doing the running around? Can you arrange a term payment plan for the fees to make it easier?

Most importantly, be willing to talk with clients about the subject. Don’t hesitate or act angry they asked or buckle at the first sign the client wants a reduction. Empathize with them, but remember what you are charging for the service you provide is fair. If you choose to invest in a client, make sure they know it is a temporary situation. Let them know you are willing to do it because they are an important client of the firm and you want to help.

Finally, consider proactively approaching clients you know are suffering and invest a little in fee reductions or a temporary change in scope. Your small investment will generate exponential returns by strengthening your client relationship.

A Friendly Reminder about Marketing Budgets

/in , , /by

You need one.

Ok, so maybe that wasn’t as friendly as you might have imagined based on the title of this post. But seriously, you need a marketing budget.

Why, you may ask? After all you’ve been getting by ok without one. You’re still marketing. Last year you sponsored 25 different golf holes at 20 different outings (those 5 overlaps were due to an unfortunate lack of internal communication). You have people out networking in the community and serving on boards. You take your clients to lunch and got a sweet deal on your yellow pages advertising. Last year your firm offered a couple of seminars and sent out a few letters. And maybe you even are investing in an email newsletter. Of course, you don’t really know if any of this stuff works, but at least you’re doing it, right?

So if you have all this activity going on, why do you need a marketing budget?

Here are five reasons:

  1. Control spending. The fundamental purpose of a marketing budget is to give firms control over their marketing spending. A budget enables firms to put aside a set amount of money that they would like to invest in growth and manage the way that money is spent each year. It precludes the open checkbook policy that causes firms to end up spending too much (or in many cases, too little) on marketing and sales activities.
  2. Avoid random and ad-hoc marketing activities. Creating an effective budget requires some marketing planning to take advantage of the best opportunities for growth. This ensures marketing dollars are being spent in a manner that supports your firm’s growth strategy. Without a budget and this forethought, firms often struggle to reign in their spending. These same firms almost always find themselves engaging in one-off marketing activities that may or may not support a firm’s vision for growth.
  3. Leverage investments. A by-product of developing a marketing budget is the ability to leverage marketing investments by creating activities that support each other. For example, investing in an advertisement in an industry journal can also support an investment in telephone lead generation that is also focused on that industry segment.
  4. Measure results. Without a marketing budget it is impossible to measure the return your firm is generating from its marketing investments. Measuring results is critical in determining which activities you should continue to implement, and on which activities your firm should not waste your people’s time or firm’s money.
  5. Ensure the proper balance between marketing and sales. Firms need to implement the right mix of marketing and sales activities to be successful in meeting their growth goals. By evaluating your firm’s marketing budget you can get a feel for how your firm’s business development efforts are divided among marketing, transition and sales activities to make sure the mix is appropriate based on your firm’s goals.

Yes, five awesome reasons you need a marketing budget. What are you waiting for? Don’t know where to start? Visit our website to learn how we can help.

Building Your Brand in 30 Seconds or Less

/in , , /by

In professional services, it can be difficult to differentiate among firms that offer (from the buyer’s perspective anyway) the same service. After all, you all subscribe to the same credentialing programs. You follow the same set of professional practice standards. You all do quality work. On the surface — your firms all appear the same.

During the course of consulting with a firm it’s common for us to ask professionals at various levels (staff, associates, managers, partners, etc.) as well at those with different aptitudes for business development, “why should companies work with you?” Inevitably, we receive as many different answers from professionals within the same firm as individuals we ask.

Most of your firm’s branding is done through your people. Your professionals interact regularly with clients, prospects, referral sources, and even the media. If each of those individuals is telling a different story about what makes your firm great, how effectively will your firm’s brand be built? Branding is about message consistency. And if you’re inconsistent you are squandering your firm’s branding opportunities.

One of the best branding investments your firm can make is to develop a 30-second speech. A 30-second speech is your firm’s answer to the question “tell me what you do”. It consists of standard talking points that everyone in the firm should know and practice. The purpose is to ensure when employees from your firm interact with someone in the community they all talk about your firm’s brand the same way.

Talking points include:

  • Who your firm serves (target market)
  • What business issues your firm helps solve
  • Benefits of working with your firm
  • What makes your firm different

Any facts you introduce about your firm should include a response to “why is that important to a client?”

Once your firm has this useful tool in place, leaders in the firm should present the talking points to everyone, and let everyone practice delivering the points in their own style. Remember, it’s a 30-second speech — so the guideline should be that answers are short and succinct. Practice is important to both keeping it short and making it sound natural. The 30-second speech can also be the basis for all your firm’s other branding materials — brochures, advertisements, website content, etc. This consistency, over time, will help the market understand why you’re the best choice to meet their needs.

And, it all starts with 30 seconds or less.

The most neglected part of your business development strategy

/in , , , /by

I received an email from LinkedIn recently with a subject line indicating that nearly a third of the contacts in my network changed jobs in 2010. It got me to thinking about the most critical and neglected component of most firms’ business development strategy — database management.

Your database may contain all the companies that reside in your geographic footprint. If so, you must use your defined target market criteria to zero in on those companies that would be the best fit for your firm as clients based on industry, size, ownership, etc. But that’s only step one.

The mantra of professional services firms is: “Ours is a relationship business“. Does a relationship happen between entities? I have a mortgage, but when I need something I don’t call “the bank”. I call Dave. When Dave left the bank, I moved my business with him.

Your database should contain updated information about the individuals at the companies you would most like to have as clients. And maybe not just one individual, but several who play different roles in the decision to hire your firm — influencer, decision maker, gatekeeper, etc. That’s step two.

Now, consider the fact that those individuals are not static. They don’t stay where they’re supposed to, and if you look away roughly a third of them (by my admittedly unscientific measurement) may take off on you. How can we prevent this from raining on our business development parade? More importantly, how can we use this as a business development opportunity?

If your list is already out of date — meaning you haven’t made any efforts to clean it up in, say, the past six months — a good exercise is to have someone call each company and ask if CFO is still the CFO, the CEO is still the CEO, etc. Make these changes and add any new contacts you discover to the list. Yep, that’s step three.

Within the target list, you probably have a handful or two of individuals that you would like to get to know on a deeper level — and who you would really, really like to land as clients.

Social media (as we have recently discovered) can be an excellent tool to help keep this targeted prospect list updated. When you receive those messages indicating that someone in your network has updated his/her profile — don’t ignore it. As a matter of fact it’s a good idea to check in on your network at least a couple times a week to make sure you don’t miss anything. If you see someone has changed positions post a congratulatory note on their profile. Better yet, call him or her with congratulations and offer to find out more about the new position and employer over lunch. And don’t forget to update your firm’s marketing database with any new contact information. Steps four, five, six, etc…

If your targeted prospect leaves it’s not only important to follow that person, but also to make sure you know who his or her replacement is. You can probably find this out by a quick phone call to the company’s receptionist.

Promotions within the same company can be treated similarly. Ask this person how their role has changed. Are they overseeing any new areas? Do they have additional decision making authority? Again, makes sure your list is updated internally — especially titles. Receiving something in the mail that doesn’t acknowledge his/her accomplishment is pretty off-putting to a lot of people.

All business development efforts, whether virtual or not, are fundamentally dependent on keeping your data updated. Implementing a few of these ideas will profoundly improve the results of your business development efforts.