Main Idea
Do you have clients who drag down your whole organization? When those clients call, does everyone run for cover? After they leave your business, is there one big gripe session?
Expansion of Idea
Several years ago, we started evaluating our clients on an ABCD basis. A clients are generally our more profitable clients who we enjoy working with. They tend to be bigger accounts because we are doing more with them. B clients are solid bread and butter accounts who are good to work with but we are not quite as involved with them as with the A clients. C clients are those who don’t always pay attention to our advice, or may get a little behind in their bills and are not always a delight to work with. D clients are ones who suck the life out of us or, alternatively, we are not the best fit and our services don’t line up with what they really need. We have made it a policy to get rid of the D clients as soon as practical. We have done some of this every year.
Even with the economy in the tank, in the past year I have resigned from several accounts. The reason that it still makes sense is that it is consistent with my stated goal of providing value to our clients. I am only compensated if my firm adds value to our clients. When we stop adding value, then we need to move on. That frees up resources so that we can improve our services to our A or B clients. We also can use that time to help our C clients become B clients. (Of course, if they choose not to improve, then they will be next year’s D clients.) Our real goal is to keep helping our clients improve their businesses. Small minorities of clients can actually do damage to our other client relationships. That is something that I cannot afford to let happen.
Areas to Start:
List your clients either individually or by type or by region.
Identify the parameters of ABC & D clients
Assign your clients a grade
Fire the D clients
Work on a plan to help C clients become B clients and for B clients to become A clients