I’ve always felt simplicity is conducive to maximizing a firm’s growth potential. If you have too many services or focus on too many niche industries, you won’t be able to grow as quickly as you would if you specialized since you’re now a jack-of-all-trades, master of none. This is why so many industry experts, including our friends at Hinge, tout industry specialization as one of the preeminent growth strategies for professional services firms. But instead of focusing on the firm, let’s take a minute to look at another crucial component of the operation – the firm’s clients.
How many clients can you have before it becomes too many? The answer is unique to each firm, but in a perfect world, you don’t have to fire any clients. You’ll have a great relationship with each, both parties will prosper from the relationship, and they’ll keep referring you to new clients. Of course, it doesn’t work that way, and occasions will arise when you must fire a client due to one or more outstanding reasons.
There are a wide variety of situations in which this would be the appropriate action, but let’s take a look at just a few.
- The client is temperamentally difficult. We’ve all been there. You answer the phone and hear their voice and your stomach sinks a little. And you probably think, “Why do I even deal with them? I don’t want to associate with people who are just plain rude to me and our staff.” So why do you? Life’s too short to deal with people that are going to drain you of energy and motivation, and that’s the last thing you need in your practice.
- The client doesn’t listen to you. Are they argumentative? Do you recommend a strategy to them, only to find later that they haven’t taken action as you instructed and now you have to fix it? Have you also heard that they’ve been consulting someone else? Then you probably don’t need them.
- You just don’t provide enough services for them. This is something else to keep in mind. Is their difficulty worth the few services you provide for them? Have you done all for them you think you can? And this actually relates to our next situation…
- The firm is moving in a different direction. It happens. You wish to concentrate on objectives that are different than those with which you started, and certain clients may not align with those objectives based on where they are in their development. Do you keep them on when you won’t be doing them any favors because you won’t be facilitating a mutually beneficial relationship? Or do you let them go in order for them to pursue a new opportunity with an advisor that’s better suited for them, and in order for you to really prosper?
Now let’s look at how firing clients can actually be great for your practice.
- You can work with clients that you know you’ll service in the best possible ways. Firing clients who fall outside the boundaries of your target industries will allow you more time to provide increased services and proactive advisories to your A- and B-clients. It also allows you to improve your avenues of communication with them – you can follow up better on emails and phone calls and take more time to meet with them, thereby ensuring your time is well-spent in all directions providing the best service to them.
- It’ll maximize your resources. Again, you know your time and the staff’s time is well-spent on your best clients.
- It improves morale. Because let’s face it, when you let a temperamental client go, it removes a dark cloud from over the office. People can be a little more at ease when they come to work, since they know they won’t have to deal with *that client* anymore.
- It makes things more simple. To come full circle, simplicity is so important for long-term growth. To dismiss a client doesn’t just mean you’re lightening your client load, but more importantly, you’re allowing yourself more time to do what you need to do to succeed. And if you do that, you’ll be successful.
Because who wouldn’t their work life to be a little more simple?
Do you have a story about firing a client? Sound off in the comments, or let me know on LinkedIn. Ciao for now!