Watch this great video to help understand the changing world and how social media is changing the way we do business. What does it mean for the accounting profession? Stay tuned…
Archive for July, 2010
Referrals are the lifeblood of an accounting firm. Make sure you nurture your referral network. In addition to asking for referrals, here are a couple of tips to help.
1. Collect testimonials. After each meeting with each client, please remember to ask them for a testimonial which you may use on websites, brochures, newsletters etc.
2. Never tell clients that you are busy but remind them that business is great and we’re always looking for more.
3. At events don’t be afraid to ask for business cards. Make sure you follow up by sending them a letter introducing the firm and include 2 copies of your firm brochure. Ask them to pass the extra copy onto someone they think might need your services.
4. With any correspondence to your clients ALWAYS enclose 2 business cards and have a “p.s.” at the end of the letter that says: “I’ve included 2 business cards – please feel free to pass them on.”
5. Handout “gimmicks” to as many clients and prospects as you can. The idea of handing these items of notoriety, is that you encourage clients to hand them out to other people or at least show them to other people when you are not even there. Note pads and coffee cups are great giveaways. Think of something people use everyday. Rulers and calculators are also great.
And remember it’s more important to be different than it is to be better. Why is your firm different from the competition? Spend 5 minutes at the next staff meeting to discuss this, but beware: friendly, professional, and proactive is not enough.
I’m sure you’ve heard about of the Pareto Principle many times. Put simply, more often than not, 80% of a result will come from 20% an activity. And when we apply it to an accounting firm, the principle holds true. I’ve seen firms who can attribute 80% of their revenue to just 20% of their client base, and the question I have to ask is “why do you even have the other 80% of the clients?” It’s a difficult question to answer, and to be honest, most firms aren’t even aware of this until it’s identified with a thorough analysis.
With the analysis we can break the clients into four categories. The top 20% of clients are your A clients, the next 20% are your B clients and the remainder are C and D clients.
Could the time being spent on the C & D clients (the bottom 60%) be better utilized adding more value to your A & B clients? If the answer is yes then the C & D clients have to go(you can keep the strategic C & D clients, but everyone else has to go).
Ric Payne over at Principa designed this great analysis tool (read the blog post too!) to help you analyze your client base. WARNING: This exercise is not for the faint of heart, it will take some time. However if you need convincing that the bottom 50% of your client base is not contributing a great deal to your firm, then take the time to go through the complete process.
What I find is most Partners know who their C & D clients are, in fact the entire firm knows. I like to have the team go through the Chopping Block exercise. Each member of the team has 5 client nominations for the chopping block. They’re submitted to the Chopping Block Committee along with the Client Disposal Checklist and the committee decides each client’s fate. If a client is on the chopping block it means they are a client contributing to the headaches of the firm.
There are a couple of ways to handle the clients who have to go. You can bundle them up and sell them to a smaller firm, write to or phone them and let them know that you can no longer service them at the level they want for the price they are willing to pay (and recommend some other accountants in the area) or you can price them out of the firm. I don’t support the third strategy as they’ll often stay and only cause more headaches. We’ve developed a number of letters you can use to ‘let clients go’ for our members. Regular membership to 2020 Group is free and gives you access to these letters. Find out more.
Where is your firm headed? This 4th of July Weekend many of you will head out of town, off on vacation – most of you with a final destination in mind. If you’re driving, Google Maps or your GPS device will give you turn by turn directions to get you there in an efficient manner.
Wouldn’t it be great to have the same for your firm, giving you turn by turn directions to your destination?
There are a number of applications out there that do this. The challenge however, is that very few firms have that final destination in mind. What’s yours? Share with 2020 your vision. Once you know the destination, you can map out the route and identify all the milestones along the way.
Creating a destination or vision is very difficult. We created the 2020 Strategic Evaluation and the Partner Questionnaires in the Resource Center (Members Only) to get you thinking about it. Share them with your partners, as the long weekend is a great time to be thinking about this strategic issue.
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Got a question for 2020? Email email@example.com and we’ll answer it in our next Flash.