Guerrilla Tip Extend Your Reach with Social Network Software

Dubbed the Technology of the Year 2003 by Business 2.0, Social Network Applications analyze networks of people and their contacts to extend your personal and professional network faster and further. These software programs use social network theory to do everything from matching people with others in their own organizations to generating sales leads.

Vendors claim their programs can provide access to and insights about decision makers and get you business introductions that might not otherwise happen. They also say the software increases sales leads and shortens the sales cycle.

Some critics of these programs assert that social network software is another dot-com bomb waiting to happen. In the meantime, some consultants have had success with these tools so you may want to take a look at a few, like Spoke, Ryze, Visible Path, and ZeroDegrees.

created strategic relationships with their best customers scaled to the amount of business they conduct with them.

Before you invest in a strategic client, consider the following criteria.

Practice Building

Identify the practice-building benefits that justify investing in the client beyond the current project. Will an added investment generate new services you can market, an expanded industry presence, or new members for your network? If so, are they worth the investment required? Additional investment may be worthwhile if a client has the potential to refer business to you. The client may offer you long-term projects or the opportunity to move in interesting new directions. In addition, if the client is a prestigious industry or thought leader, examine whether your added investment could increase your standing in the industry or produce important referrals.

Chemistry and Culture

Consulting is a high-contact business and the success of projects hinges on the consultants' energy and motivation. A client's organizational culture strongly influences consultants' energy. Consultants thrive in an open, cordial, responsive setting, but may be discouraged when treated poorly, have their invoices held unreasonably, have no access to authority, face endless red tape, and receive knee-jerk reactions in response to their recommendations.

During a project to help a retail client decide how best to survive bankruptcy, consultants found themselves in the project from hell. The client's site was like a ghost town—eerily silent with empty cubicles everywhere. What was worse, the organization's remaining employees deeply resented the consultants' presence. They felt the consultants were high-priced replacements for their former colleagues, and so they were sullen and uncooperative at every turn.

If a client's staff mixes well with the consulting team, it is easier to justify more marketing investment to retain that client's business. Some clients deliberately keep consultants at arm's length and resist efforts to build relationships. Although these situations can be awkward, they are workable. Clients are undesirable if they are not open to your ideas and are unwilling to see you as a potential advisor on a broader range of topics or future projects.

Will It Work?

Unless you're financially desperate, it makes little sense to pursue projects that you feel can't produce the desired result. In some cases, you may not have the right qualifications or experience, or the client may appear to be unreasonable or unresponsive.

Trust your instincts. Certain projects and clients were never meant to be. Committing ongoing marketing efforts to a client that has all the signs of trouble can wreck your reputation, kill your staff's morale, and spike employee turnover. Help the client find another firm instead. You'll earn gratitude from the client for your help and from the new consultant for the referral.

Profit

Again, profit is imperative for long-term relationships. Can you profit from working with this client, and if so, how much? Volume of fees is usually a false indicator of profit because large-fee projects can lock you into low margins for years. Look at forecasted profit to decide whether the client warrants additional marketing attention.

Sometimes clients tempt you with promises to provide new business referrals, expand your network, or put you in the project opportunity lead stream. Discount all such promises and evaluate whether the relationship can actually produce the benefits necessary for an additional investment.

Ask yourself whether the client will require sufficient consulting services for you to profit long-term, both financially and otherwise.

Location

Every consultant has a different perspective on travel. Most are resigned to travel being a part of the business. Think about where your clients are located and decide whether the investment in travel is worth it. And don't forget to evaluate the impact of traveling on your other client commitments and on your life: Travel can exact a severe physical toll.

Clients whose locations are close to yours may be preferable for long-term relationships. In The Art of War, Sun Tzu calls this the "facile," or easy ground.4 While certainly not the only factor in your decision, location should be a consideration.

Identifying a strategic client comes down to one question: Will it be mutually beneficial for you and the client to invest in each other? If the answer is yes, that client goes to the top of your list. Then, you must decide how much of your profit or time you are willing to invest in the client to win more work or referrals. That will vary with the size and profitability of your practice. To return to the airline analogy, some frequent fliers receive more preferential treatment than others based on how much business they do with the airlines. You can also apply that approach to your best clients.

> Rule 6: Loyalty Is a TWo-Way Street

Client loyalty is tough to come by. Clients who think another consultant can provide greater value may be quick to forget about the past miracles you've pulled off for them and switch firms. Managing client relationships is about mutual long-term gain. No loyalty should be expected on either side without that.

Some consultants are easily drawn to the next sales opportunity with a different client instead of building on established client relationships to generate new projects. Perhaps it's the lure of the chase or the excitement of new clients, but it's often a mistake to abandon a strategic client for an unknown entity.

Be patient and understand the realities clients face. Don't throw in the towel when things don't go your way or you think clients don't show appropriate appreciation for you. Clients have an obligation to check out alternatives and consider every option that might help them achieve their goals. And your firm may not be the one they need at the time.

Even though your clients may not seem loyal to you, be loyal to them. Despite their inconsistency and explorations with other consultants, always provide them with consistently great service. Give them focused, useful points of view as promptly as possible. Keep in mind that you can offer existing clients higher quality work, with similar or less effort, at higher profit margins than your competitors.

Know when to walk away from a client relationship. Not all clients are worth the investment necessary to get more business from them. Although most clients add to your practice, some subtract. Try to continue working with clients who share your interest in long-term relationships. Consider pulling the plug on client relationships in the following circumstances:

They are only transaction-oriented. Clients that only care about one project at a time and are unmoved by the wonders you have worked for them in the past are usually poor investments. If they treat you like a vendor instead of like a professional advisor, look elsewhere.

They are openly opportunistic. Some clients will switch consultants in a heartbeat. Often for small decreases in consulting fees, these clients change consultants faster than you can say Benedict Arnold. Don't waste your time with them unless you are prepared to play an endless game of fee negotiation.

Every interaction is adversarial. If you love to fight, then this may be your ideal client. For the rest of us, dealing with contentious people is a drag. Let them find other victims to torture.

They don't reciprocate. Some clients ask consultants for unpaid extras like conducting research and making presentations. After the extras are provided, they turn around and hire your competitor, even though you are well qualified to complete the work. Reciprocity shouldn't be expected in every case, but consultants should expect some consideration for past efforts.

You become isolated from decision makers. As pointed out earlier, you shouldn't take on a project if you don't have access to decision makers. But if, as a project unfolds, you are shunted off to gatekeepers who can only say "no" and thwart your attempts to reach those who can say "yes"—it's time to think about throwing down your cards and getting out of the game.

It is critical to your long-term success to know when to pull back from, or even drop out of, a client relationship. Don't remain engaged in an unproductive situation—it's not good for you or for your practice.

Carefully select the clients with whom you want to build long-term relationships; they are the backbone of your consulting practice. The objective of your client-level marketing should be to create partnerships with your most profitable clients so that you can help plan and participate in their future consulting needs. Although consultants provide services to clients, ultimately consulting is a people business, and it will only be as successful as the relationships you forge with the people in your clients' organizations.

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