Are you part of your client’s growth or just a cost?
If you want to have a seat at the table, you must be seen as contributing directly to your clients’ growth and profits. If this is the case, they will never get enough of you. But if you’re viewed as a cost—a necessary evil, like buying gas for your car—they will cut you anytime.
Over the last decade, I’ve studied several hundred long-term client relationships built by leading service firms in a variety of sectors. While there are many common denominators across these trusted partnerships, probably one stands out: In almost every case, the service provider is viewed as directly supporting the client’s most important goals for growth, profitability, and innovation.
A good example of this principle is the financial audit of public companies that is required by law. The best audit partners at the large accounting firms are able to position their audit services as far more than just fulfilling a statutory requirement. In these relationships, the audit firm is also helping the client to identify and reduce risk, improve their financial management practices, built a great internal team of finance professionals, improve operational performance, and so on. In other cases, I have seen the audit reduced to a fungible commodity that is purchased purely on the basis of having the lowest price. And when another audit firm offers to do it even more cheaply, the client is happy to switch with no compunction whatsoever!
Do your clients view you as supporting their most important goals? Are you part of their growth and profits? Can you tie your work directly to these things, and show the value of what you’re doing? Or are you a kind of necessary evil, an expense that they have to begrudgingly incur—sort of like when you buy gasoline for your car?
This principle lies at the heart of the difference between a trusted advisor and a mere vendor.
How to put this principle into practice
Here are 5 strategies that will help you position yourself as supporting a client’s growth and profitability:
1. Move up in the organization. Senior line executives are responsible for both revenue and profits; and top functional executives (e.g., the head of HR) usually feel a direct link to these same goals. Mid-level staff executives have cost budgets, however, and are more likely to focus on expense control and be highly price sensitive.
2. Be an agenda setter. Invest time to understand your client’s agenda—their highest-level goals and key priorities. Help to shape and improve the agenda. Show how your work supports the agenda. Demonstrate thought leadership around the agenda.
3. Always ask “Why?” When a client says, “We want to do a two-day training program. How much will that cost?” you risk sub-optimizing the engagement if you immediately agree to explore that option. Instead, you should ask “Why do you want to do that?”—even four or five times—to try and uncover the high-level goal that is driving the perceived need for a training program.
4. Broaden your conversations. If all of your conversations with your client are about the immediate project, you’ll never establish your credibility to discuss their broader business issues. When the breadth of your conversations increases, so to will the breadth of the relationship.
5. Quantify value early on. For any and every engagement, you must explicitly discuss with the client the value which will be created. When you get the client to articulate about how a particular initiative will affect costs, efficiency, retention, risk, revenues, and so on, you begin to connect it to growth and profit goals.