In this article Mark welcomes Allen Debes again to share his advice on how to weather client relationships when they get stormy. Clients pull work for different reasons, many beyond your control. But there are steps you can take to ensure this doesn’t catastrophically impact your business. Read on to learn more about hunting for new work, facing client issues head-on and when it’s time to say goodbye.

Some of the reasons clients pull work

“A client just notified us that they're rolling off the whole team. They’re asking if we can waive the two week notice period.”

This is one of the worst things to hear when you’re running a consulting business. It’s unfortunately a fairly common part of the job too. Here are just a few reasons it can happen:

• The client missed their earnings and the project was cut
• Your key sponsor left the client and their replacement has “their own vendors”
• Your team pointed out that the project strategy was wrong (at least this one fosters a better relationship long term)
• Another project has gone off the rails and the client is moving all their resources onto that to fix it
• Your team screwed up the project

This issue makes growing a firm really difficult, and in my early years of running Nexient, I didn’t really have a good strategy for managing it. In a project-based business, you have to resell your whole book of work year on year. When you lose a key part of your revenue, you’re starting from behind where you were the prior year.

When Allen Debes joined us, he brought a great attitude and approach to managing this challenge. I’m delighted to have him back to share this approach and how to manage it effectively.

Secrets to successful client relationships

Thanks for having me back to co-author with you, Mark. In this, our fourth article together, we get into some of the toughest stuff when it comes to client work. In a previous article, we talked about “showing up and giving a shit, a lot.” That attitude drove much of our client success and our 123% YOY growth. When I moved into the CRO role, other important attitudes and approaches also became clear to me. Here are my top 5:

1. No matter how good we are, there’s a lot in our clients’ world that is entirely beyond our control. Mark has listed many of these constant uncertainties above. To mitigate their impact on us we learned to keep our heads down and do great work, while also keeping our eyes up. To do this we had to build and sustain strong interpersonal relationships across as many client stakeholders as possible. This would then give us early insights into possible risks and issues out of our control but possibly within our influence. To compliment this our best Client Partners and Delivery Leaders would speak constantly, comparing notes and deciding ideal EQ & IQ approaches with key client leaders and staff.  
2. Client work is very hard work. If it were easy, anybody could do it. Mistakes, misunderstandings, and missed opportunities are inevitable. However these can lead to moments of truth with clients where working through the misses often create more trust and more work. Starting with a straightforward apology (without any excuses or casting any aspersions) can have a positive impact on moving forward together. When we started from an open and apologetic posture, we often found clients would lean-in and own their part in what may have gone wrong. Then, focusing on root-cause, making it right (through some small or large give-back), and getting back to delivering work of value led to deeper trust and extended work with clients for months and years to come. An added bonus to taking this approach was referrals. We earned a LOT of internal and external advocacy from clients we’d been through the trenches with - “You should use these guys at Nexient, I trust them” - was not unusual.
3. We should not be afraid of our clients. We are in service to them, not servitude. Client-based work is a partnership where the client is ultimately in control, but we need to hold our own in the partnership too. For us this sometimes meant leaning into hard conversations about their team’s performance on a project, dealing directly with blockers that only the client could resolve, and addressing dysfunctional power dynamics where a rare client wanted to brow-beat our team or negotiate in bad faith. We found it was often best to address these issues in person - even better over a meal. Again, EQ & IQ situational awareness is key to success, and sometimes persistence beyond a single conversation is needed. Many, many times this again led to stronger working relationships.
4. Never, never, never stop hunting. Never. This is for entirely new clients or new buyers inside existing clients. Truly committing to this ongoing investment may be THE key to continued growth vs an endless cycle of “win work, do work, win work, do work…” which exposes the business to risk due to the inherent volatility of existing clients. At Nexient, we committed real dollars to one dedicated hunter per region, as well as ensuring the regional General Managers had some capability here too. Overall, we came to understand that we needed 20-30% of our annual revenue from new clients in order to sustain world-class growth levels for our business, as well as ensure we were continuously winning interesting work for our great teams.

Why hunting for work is hard

Before I get to my fifth point I’d like to dwell on some observations around hunting-orientated sales and the reasons behind a lack of sustained investment in them in professional services.

• Talent scarcity: Top sales talent must either learn fast or understand just enough about the complex services work we provide. They must be go-getters but also able to build deep long-term relationships with prospective executive buyers. Finally, they must be able to learn when and how to team up with practitioners to move opportunities through the pipe. These people are hard to find. Period. And when you do find them, building and retaining them can be even harder.
• Lack of a proven sales training & development flywheel: Staffing businesses don’t have this issue. Training someone to sell staff augmentation is relatively easy. Software product businesses don’t have this issue either. They tend to have incredible margins enabling extensive and ongoing sales boot camps to ensure sales people become experts themselves. This generally leaves a gaping hole in the middle - the complex professional services sector - that gets filled through JIT development in the field in front of clients and prospects.  
• Unlike in staffing and software product businesses, there seems to be an inherent resentment of “sales people” in complex consulting businesses. Practitioners (consultants, engineers, designers) often seem annoyed with sales people because they “don’t do anything.” This attitude has corrupted growth patterns in countless consulting services businesses over the years. It’s unfortunate, but it did lead us to teach practitioners to hunt. Finding people with a practitioner background who are willing to hunt (and are good at it) is incredibly difficult, but we found it to be key to our growth.

Know when to say when

5. Walk away from a client if necessary. This was our final lesson that defined our approach. The above four efforts afforded us the leverage to do this when needed. Because clients have problems, often serious problems. That’s why they hire us in the first place. We need to weather nearly every storm, every dysfunction in service to them, and deliver the value they need to evolve their business. Operative word here: Nearly. In very rare situations, we needed to be able to say goodbye to a client or prospect because our odds of success were far too low and we risked losing our best people. Doing so without disrupting revenue growth for the region or entire business, and sustaining employee morale, was sometimes a vexing challenge. Were we great at this? Not always. However, our teams respected us for having that kind of courage when it was truly needed. The worst possible problem was a region far too dependent on one or two clients, which exposed us to pricing and other problems where leverage was not in proper balance for true partnership.  

Lessons to take away

• Plan on losing some client work - it’s almost guaranteed that you will lose some client projects unexpectedly. The only way to manage this is to plan for it from the beginning. Make sure your new revenue pipeline is large enough to absorb some losses and still keep growing at the rate you’d like to grow. If your pipeline isn’t large enough, you need to invest more time in hunting.
• Continuously hunt for new business - this one can be tricky and we didn’t always get it right. Even when you have a full backlog, you should be out trying to fill the top of your funnel with new clients and new buyers within existing clients. Another angle on this one is that when we first start with a client, there is a tendency to feel that we need to wait to prove ourselves to talk to others in the organization. Time and again, we found that it paid off to start those conversations early in a new client engagement. They usually take a long time to nurture and by the time you need a reference, the initial project is far enough along to give one.
• Don’t be afraid of your clients - this one sounds funny, but is true. Most consultants are afraid to go to clients and have difficult conversations. If the client’s team is blocking the project or the client’s strategy is not right, you need to go to them and tactfully talk it through. If you don’t, you’ll typically find out later that they hold you and your team responsible for not raising it.