WHY THE CLIENT RELATIONSHIP IS IMPORTANT

A good client relationship yields considerably more benefits than simply the esteem of a satisfied client. Quite apart from the fact that it is easier and more pleasant to do business with a satisfied client, there are clear commercial advantages.

Strategic Benefits

Products and services can be based on the spectrum shown in Figure 9.1. At one end you have unique products; a famous painting might fall into this category.

Figure 9.1: A spectrum of products and services

Fairly close to that end must be the monopoly suppliers of a product. At the other end are commodity products - those that change very little according to the supplier, and for which there are many suppliers. Food retailing is an example of this: there is no difference in a particular brand of soap powder depending on the shop you buy it at.

Plainly, a salesperson is in a lot stronger position when a product lies towards the left-hand side of the spectrum. The purpose of branding a product is to move from the right-hand side towards the left, by giving attributes to the product additional to the qualities of the product itself. At the simplest level this might be attractive packaging; in the service industry it is achieved by reputation and fashion.

From a client's point of view, the services offered by a consultancy firm are really undifferentiated products; how the services are delivered is therefore fundamental in creating a good reputation. The quality of a consultant's reputation is vital in getting new business. Positive recommendations from satisfied clients to others in their network are worth many hours of selling and marketing by the consultant. Conversely, there is much truth in the old adage 'One bad job costs a hundred good ones.'

A Good Relationship Helps Sales

As has been already noted, former clients are perhaps the best source of further business - either by asking the consultant to continue to provide services in a particular area of specialization or by giving the consultancy practice the opportunity to provide a wider range of services.

Conversely, few consultants can claim to have an invulnerable client base. Just as they will seek to enlarge the size of their businesses by acquiring the clients of their competitors, so too will their competitors themselves be attempting to do the same. A poor client relationship will make a client more open to an approach from a competing consultancy practice for future work.

The Client Relationship Must be Actively Managed

It is tempting to believe that the quality of client relationships is simply the result of luck or happenstance. This is not true. The client relationship must be actively managed in a way complementary to the technical work being carried out by the consultant. Consultants must bring competence to both these tasks if they are to be truly effective.

Consultants have taken up their specialization because of their interest in the topic. Their training is directed towards achieving excellence in the technical aspects of their work. But the judgement made by clients about the quality of a consultant will not be simply on the technical aspects of their work together; it will also depend on a variety of other factors that contribute to the nature of their mutual relationship. For example, the consultant who carries out a project to a high standard but takes too long over it will leave a trail of discontented clients.

Client relationships rarely deteriorate because consultants think them unimportant or are personally insensitive. It is that the task of active client relationship management can often too easily be crowded out by other activities until some (avoidable) crisis arises, which brings it forcibly to the consultant's attention.