CPA Trendlines

Don’t wait until the end of the year to find out how well you are serving clients.

August Aquila, CEO of AQUILA Global Advisors, a full service consulting firm serving the accounting profession.

by August Aquila
AquilaAdvisors.com

You can ask clients at the end of the year about how well you met their expectations, but that does not give you any time to change your current modus operandi before year-end.

A better way is to have leading measures that tell you how you are doing during the course of the year.

Let’s look at eight.

1. Number of personal meetings with clients. If you meet if your key clients on a regular basis you will gather the necessary information to improve service and increase client satisfaction. Each partner should have specific goals to meet with clients. Feedback should be shared with all partners and changes and improvement in your service delivery system should be made during the year.

2. Number of client complaints. This could be a key indicator of how well you are serving clients. Just because clients don’t say anything, doesn’t mean that they are ecstatic or even happy. Most clients don’t complain, that just walk away. That is why, one-on-one meetings with clients are so important to gage a client’s satisfaction with your firm.

3. Client service guarantees implemented. If your firm has a client service guarantee, how many of your clients are actually requiring you to honor it. Again, this would be an indicator of how well you are serving clients.

4. Accounts receivable. Happy clients usually pay their bills faster. There are two measures that you should be tracking here.

4a. First, the number and amount of A/R adjustments. The more adjustments you or a particular partner are making, the more problems you may be having with clients. This may be an indicator that you are not spending enough time with clients discussing fees and your value proposition.

4b. The second indicator is A/R aging. There are two potential issues with aging. One you don’t have an effective collection process in place. Two, service to clients is poor and this is the clients’ way of letting you know. It’s important to know which of the two issues your firm is facing.

5. Percent of client rating firm a 5. When you do a client satisfaction survey, you will want to know what percent of your clients really think you are doing a great job. These are the fives. You need to work on the fours and the threes. These clients are satisfied with your services, but there is a service gap between what they are getting and what your service goal is.

6. Client turnover. This measure definitely indicates how well you are serving clients. A high turnover ratio (the number of clients lost divided by the number of clients gained) may be a sign of serious trouble in the firm, or it may just mean that you are culling your client list in order to get rid of unprofitable clients.

7. Client referrals. This is another gauge of how well the firm is doing in meeting its service objectives. This should be measured monthly. A decline in client referrals over a period of several months is a sure indicator that service quality is suffering in the firm.

8. Share of the client’s wallet. While you may not be able to do everything for a particular client, it is important track the percentage the firm derives from each client’s budget for professional services. Over the life of the client this amount should be increasing. Be particularly weary if clients begin to use other service providers for work that your firm does.

Posted August 16, 2010
Related Topics: client, retention, Service