How to build relationship capital as a foundation for building your firm

Ed Mendlowitz, a frequent contributor to the US CPA Trendlines Newsletter, recently wrote a short piece on the 8 ways to charm a client and noted, correctly in my view, that our performance gets assessed largely on the small things. I totally agree with his sentiment but have modified his suggestions somewhat to reflect what I think charms clients.

Ed Mendlowitz, a frequent contributor to the US CPA Trendlines Newsletter recently wrote a short piece on the 8 ways to charm a client and noted, correctly in my view, that our performance gets assessed largely on the small things. I totally agree with his sentiment but have modified his suggestions somewhat to reflect what I think charms clients and what doesn’t.

Ed makes the point that clients are our customers, they pay our salary and enable us to make a good living. The better we treat them and look after their needs the happier they will be and the better our “living” will be.

It’s difficult, if not impossible, for a client to judge how good our work product is but they can certainly judge how well or badly we make them feel. It is on that basis that they judge us … period.

For that reason, great firms that experience solid, profitable growth from servicing great clients and attract (and retain) talented team members have great relationships with the clients they want to work with. For that to happen, you not only need to be at the top of your game technically (a necessary but not sufficient condition for successful growth), but you also need to make your clients feel important and appreciated.

Roughly following Ed’s 8 points, here is a checklist of the things you might want to use to judge your own performance.

  • Are your phones always answered on the second ring?
  • Are your phones answered whenever someone is in the office? You may not believe how much customer appreciation capital you’ll build when you deal with an issue “out of hours” even it’s only to explain to your client that you’re putting a plan in place right now to address it the next business day to let the client feel you’re on it! When people say we sell “peace of mind” that’s precisely what this is and in such circumstances it represents tangible value to your client – probably a lot more than their assessment of the value of the last tax return you did for them. This is quite different to saying we sell peace of mind that our clients’ tax matters are being competently handled.  That’s a table stake, it’s an expectation of acceptable performance, it’s not a differentiating value proposition.
  • Do you always give your clients a “heads up” on unexpected results – good as well as bad results including, for example, that a promised deadline will not be met?
  • Do you occasionally give your clients an extra (and I’m not talking of an invitation to your annual golf day)? This might be a random thing like sending them a link to an article or video of interest to them (that tells them they are on your mind), maybe a hand-signed birthday card (even better, a phone call) especially on a major birthday or anniversary.

By the way, talking about “annual golf days” and the like, you need to be careful that extras like this don’t become expectations unless you intend them to be. The reason is that in the first instant you might think an invitation to your golf day or to join you in your member’s lounge for a major event at your local sports stadium is a great marketing initiative and it may well be. However, once it becomes a standard recurring event it becomes an expectation by the people you already have a relationship with and its marketing value declines but its cost, in all likelihood, rises because you need to continually invite more “prospects” to keep your marketing funnel full. It changes from being an extra to an expectation and if a client does not get invited you’ll actually destroy relationship value.

I’m not suggesting you should stop doing these things I’m simply suggesting that you need to understand the costs and consequences. In my opinion, spontaneous acts of kindness or sharing of information, leads, or ideas without seeking compensation are far more productive relationship building tools than the big ticket events. And for the record, let me add a critically important point; in my personal experience I got way more marketing and relationship value from organizing a round of golf with a prospective client and one or two existing loyal clients than we ever got from our firm’s annual golf day. You’ll be absolutely staggered how often that “prospect” becomes a client within 12 months without you uttering a single sales word!

  • Do you know the names of your client’s spouse and children as well as other things that are important to them such as their recreational interests? And if so, do you check in on how they’re doing when you meet? This does not need to be over-done.
  • Do you return their calls and emails promptly – certainly within 24 hours?
  • Are you available when your client needs you. Don’t tell them you’re too busy or under-staffed – they couldn’t care less. If you’re under this sort of pressure you either have too many clients, not enough team members, or you have a leadership and/or management problem – in short, you have systemic issues that are constraining the value you are bringing to the table and probably the long term growth and profitability of your business.
  • If a client complains, do you acknowledge the problem and deal with it immediately?

You can’t fool your clients into thinking you care if you don’t. And remember, your clients aren’t interested in your problems or how busy you are, they have enough of their own challenges to deal with. If you want to build your relationship capital you need to focus on building your relationships and the only way I know how to do that is to deliver a high level work product and support it with ensuring your clients feel appreciated, important, and valued.

Someone once said “your clients don’t care how much you know until they know how much you care.” I’m not sure if that’s absolutely correct but I’m pretty sure when they feel how much you care, they’re more forgiving about what you don’t know as long as you know enough to properly service them.

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