Save content
Have you found this content useful? Use the button above to save it to your profile.

why bad clients are good news

1st Nov 2013
Save content
Have you found this content useful? Use the button above to save it to your profile.

As professionals we are all aware of the Pareto Principle that states 80% of our revenue comes from 20% of clients. But what are we to do about those perceived time-wasting, revenue sapping clients that cause us sleepless nights and bear very little fruit in return? Many in business think 'take control – get rid', but I say a stint with a ‘bad’ client can be an incredibly positive thing for your firm's future success, and here's why.

Before assigning any client to the scrap heap, it is necessary to review what has gone wrong and acknowledge the part your own firm has played in the breakdown of the client-supplier arrangement. Even the most well-managed practices will have some shortfalls, and your negative experience will force you into uncovering every stone and ask some serious questions about the day to day running of your firm.

For instance, your practice management system might reveal if the wrong accountants have been assigned to the job or if a more experienced consultant would have a better, more positive impact.

Historical data could also reveal missing billable services or hours that have not been recorded properly, leading to a reduction in revenue that makes the client's account unprofitable. Or it could disclose time-wasting bottlenecks that are preventing a smooth and efficient workflow and provide an explanation into a client's constant demands for a faster turnaround.

The exercise of drilling down to the nuts and bolts of your firm on an operational level could not only prevent your firm losing a potentially worthwhile account, it could also help identify new opportunities and spark positive change from the visibility it provides. With this in mind your experience with a 'bad' client may end up being one of the best things that has ever happened to your company; and if it doesn't at least you know you tried everything, safe in the knowledge that some things are destined to just not work out. 

Tags:

You might also be interested in

Replies (0)

Please login or register to join the discussion.

There are currently no replies, be the first to post a reply.