Back to Basics with Client Service
Three Rock-Solid Principles.
by Rick Telberg
Sandra Wiley, COO, Boomer Consulting
It shouldn’t take an economic downturn and cutthroat competition for accounting firms to rekindle their interest in optimizing client service, satisfaction and retention.
“It should be at the top of the agenda all the time,” Sandra Wiley, COO at Boomer Consulting was telling me.
But with the economy of the new normal, client service has become a hot topic.
It doesn’t take a rocket scientist to see how critical client service is to success or failure for an accounting practice, not to mention any business. Just do the math. By some widely accepted measures cited by Wiley, unhappy clients will tell 10 people and happy clients may tell four. Unfortunately, too many accounting firms go to market as if their motto was, “We’re no worse than anyone else,” Wiley says.
What should you do about it? Wiley starts with a few basic principles:
1. The customer is always right. They may not be able to prepare their own tax return or run their own P&L. But you can’t argue with their opinion of you, your firm or the way they’re treated. It starts with listening, listening hard and listening systematically. Sometimes that may require an outside consultant with objectivity and independence. And if you hear something you don’t agree with, go back to the beginning of this paragraph.
2. Every person in the firm is responsible for delivering — in Wiley’s term — “amazing” service. Everything a firm does must be predicated on client service and satisfaction — delivering value that clients understand. It really doesn’t matter how many hours you put in on that audit. The client just wants the unqualified opinion and your ideas on what you found while doing the audit. Clients really don’t want to pay taxes; they want to have paid taxes. And your job is to make that as painless as possible.
3. And, finally, you can’t treat your clients any better than you treat your staff and each other. So start by looking at ways to make sure your staff is happy, satisfied and fully engaged in the work of the firm.
To put the principles into action, start here:
Understand who your best clients are. These are the clients you’d like to clone. Start ranking your book of business by criteria like revenue, referrals, the number of your services they use, “share of wallet,” risk and how big a pleasure (or a headache) they are to work with. With that, you’ll probably discover that 20 percent of your client list is producing 80 percent of your income. Now you know on whom to focus.
You’ll also find out who your problem-clients are. With tight staffing and the need to make every billable hour count, few firms can afford to waste time on marginal clients. Start weeding out the bottom 10 percent. Some firms simply raise rates or cut service. But that can be a mistake, creating a whole new category of disgruntled ex-clients. Better: You can send them a “Dear John” letter saying, essentially, “it’s not you, it’s me” — explaining that the firm is moving in a new direction. It’s best if you can refer them to another firm or practitioner who may be better geared to take them on.
Relieved of the time sinks, you now have time to deliver the kind of service and value to your best clients. These are clients for whom you build a client newsletter, from whom you request candid feedback, to whom you send holiday invitations and with whom you build a thriving new firm.
Copyright 2010 AICPA. Used by Permission.
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http://www.cpasitesolutions.com
Nice article. This reminds me of A recent article by Nicholas D. Keseric Jr. in WebCPA discusses the need to be more than a CPA firm. Keseric writes, “Business prospects, as well as current clients, are looking for ideas, suggestions, information and approaches. How they can better run their business, increase revenues and profits. Get more visibility. Leverage what they are doing to create more opportunities.” When reading this, I noticed that a CPA website can go a long way to offering accountants the ability to put some of these solutions into action, and relieved of the typical accounting firm of the overhead in running a business, so they can deliver the kind of service and value as you describe in this post, to their best clients.
Exellent article for promotion and growth in our accounting and tax practice.
I am a 65 year old CPA. I have done taxes since college. Had my own firm. I have taken 30 days of CPE in the last 12 months. Bush rang up the deficit instead of taxing people and so far the deem have done the same thing. It can’t go on for ever. What the bottom line amounts to is, everyone is going to get the hell taxed out of them. China will not stand for our national debt going to 20 trillion. They will quit buying bonds.
My biggest problem has been clients going to Turbo Tax, citizens preparing returns on Trubo Tax and hardly any IRS audits.
But now, when the highway patrolman and the RN sit down to do their taxes on Turbotax, instead of getting $2,500 back, they will over $5,000. And it will be so complicated that they will not understand why. So they flee to the CPA office remembering the $300 they used to pay 5 years ago. The CPA will take an entire day scrounging for deductions, looking for loop holes and getting missing info and want to charge them $1,000.
The next step for the couple is to find a little old lady in the trailer court to do it, but she has been put out of business by the Preparer rules, complex tax rules and old age. The new people don’t come in and there are few new accounting graduates.
So the whole game changes over night thanks to the federal government. The CPA no longer goes to a 2 day refresher course every tax season. It is weeks and weeks of classes.
The CPA wants to be bill more, the taxpayer doesn’t understand and the wise client will pay the fee and save the taxes.
This whole dynamic will happen over a three year period. And even if the GOP gets in and reverses some of the laws, it simply makes more rules for the CPA to remember. When did the credit start and when did it end.
The whole nave of the game with CPAs will be tuning out the clients who bitch about the bills. The whiners will be shunned. The smart businessman with 40 employees will pay the $10,000 to have his tax return done and the cop and RN will be endlessly moving around looking for that $300 tax return.
CPAs will become like lawyers except more valuable.
This is the biggest single change since I began doing eases except for Computax type services and the advent of TurboTax.
It means me getting up a couple hours earlier every day and studying.
I will want to be paid for that time and expertise.
Billing has always been my number one problem. Lately it seems like a fight with every single return I do.
I am weary of the fight. I’ll just make my $40 grand and stop and go home each year. Or be lured into doing returns for the big bucks.
Meanwhile I have JK Lasser on my Kindle and listen when I drive. I have flash cards which I put on a tape recorder and will be taking another 15 days of tax classes this fall.
However it shakes out, I will know the tax law cold.
I think the question should be addressed for CPAs as a well. Any Finance Director or Administrator without being an expert has to have a strong idea of major tax changes. Those changes that will help the company he is working with, for better tax planning and give appropriate recommendation to the Board of Directors on all benefits involving those changes and improved bottom line on P&L.
Rgds.
http://www.rkbglobal.com
Dear Rick,
Definitely agree: weed out the bottom 10-20% of clients. In the past year, we let go of a significant client that not only didn’t realize the value and expertise of the Service provided, they were not geared to taking advise. In addition squeezing us on fees… resulting in risk to the practitioner. In addition, we were incurring an increasing amount of time to manage the relationship.
This has freed up valuable time to take on better clients that appreciate and want to pay for the service… much happier staff as a result.
Our motto for client service:
1) Train train and educate your staff – Knowledge is power. We specialize in international tax, including providing full service in Canada. This differentiation, commensurate with education and knowledge reduces competition in the market.
2) Respect and keep your staff happy resulting in increased productivity – listening and accommodating
3) Focus on high level of service – ensure client expectation on scope is understood before commencing work
4) Always ensure client fee expectations are in line with the nature and scope of the work. We list the nature and scope of services along with a fee estimate and get approval from client before commencing work so there are no surprises. This is especially important in complex areas like international tax and consulting.
5) Ensure continuous client communication, from initiation to completion. Ensure you deliver what you promise in a timely manner.
Thanks.
Cheers,
Ranjana K. Busch, CPA
Chartered Accountant (Canada)
Managing Member
Naperville, IL