If you're not providing the service, you're toast

Den Howlett Profile picture for user gonzodaddy July 26, 2015
Summary:
A salutary tale of how an entitlement turned into lost business. It is becoming increasingly common in the wake of new ways of working and better service efficiencies not being used to add service value.

service
Poor marks

Earlier today I came across this story from Mark Lee which he posted on LinkedIn. It tells of how he fired a professional services firm. I've amended the details slightly and omitted one line that would give the game away to get you guessing as to what kind of business we're talking about.

The reasons for seeking a new firm were more than simply feeling that we were being ripped off. In summary:

  • I had no face to face or phone contact with the partner (other than my initial call to introduce myself in February 2014)
  • It eventually became apparent that the annual fee quote excluded the [redacted] work
  • The [redacted] team seemed unable to access their colleagues' files
  • The [redacted] team asked me (new in role) for information that should have been on their files from previous year
  • I received no written communication (by email or otherwise) re the work done beyond the formal report and fee notes
  • Written correspondence from the firm continued to be addressed to my predecessor more than 12 months after they knew I had taken over.

OK - fun over. This was a Top 20 firm of British accountants but you could make that argument for many areas of professional service. More to the point, these fees were for services to a non-profit so every penny counts. In moving, Lee was able to save 50% of the fee the organization had been paying. He provides more color in this explanatory story.

Among other things he says:

To give the firm credit, everyone who communicated with me and the bookkeeper was efficient, polite and professional. However I never once received a phone call from anyone. Not once. I simply cannot accept that this is best practice.

I find it bizarre that an accountancy practice (whatever the size) can service a client paying the firm many thousands of pounds each year without someone actually talking to their key contact at least once during the annual process. Even more so given that I was new in role.

I remember my time in practice and we always met with the client at least once a year and preferably at their premises. Yet still, impersonal services are considered 'normal.'

The problem I see here and which can be applied more broadly is that professional services firms with long tenure very often fall into the trap of entitlement where the relationship turns into one where the supplier assumes that the client will always be with them in one way or another.

Interestingly, Lee thinks the lack of/muddled departmental communications suggests that his organization was too small for the firm to service any other way and that they were really waiting for someone to fire them. I am not wholly convinced by that argument.

Rather I see the problem as one of cultural ossification and inertia. Again, going back to my time as a practitioner in a relatively small firm, I recall it took years to implement change of any kind. The 'we've always done things this way' argument was a guaranteed objection, regardless of the merits of alternative methods or practices.

As we will see in an upcoming use case story, the availability of viable alternatives serves to push customers away. The sad part is that it is all so unnecessary. A little thought and effort is often all it takes to ensure that the relationship between customer and supplier is maintained on the basis of mutual benefit. Automation on the back side can do wonders to free up resource but if that is solely turned to profit then sooner or later, that profit erodes in the wake of customers who drift away.

My sense is that the firing of a service organization for the reasons Mark outlines will become increasingly common as millennials come into positions of power. They are well used to a digital life, have easy access to alternatives, research online long before making any buying decision and likely know more about you than you do. They also know what they want from a relationship and it is way more than a transaction.

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