Know your client (3)

Caroline’s Club is a club for professional advisers who want to meet and collaborate using a strategic business development tool because, as we discovered last week, traditional networking doesn’t work.

This is not a matter of peripheral importance to professional organisations. Professional advisers and business development managers are under immense pressure to grow their organisations' fee income.

The problem is that most organisations categorise their professionals by their differences, including their skills, education, seniority, practice areas, and jurisdiction. These differences are then reinforced by social media platforms such as LinkedIn, including the new LinkedIn Navigator.

Caroline’s Club focuses on the similarities between professionals through the client types they serve. Professionals can then be grouped in the same organisation according to the client type they serve to form ‘Marketing Clusters’ and across different disciplines in other organisations called ‘Marketing Pods’. The Club is supported by an integrated strategic business development platform https://carolines.club to showcase the client types of each professional linked to their profile and position on a global map through case studies, blogs, podcasts and satisfied client quotes.

To adopt this new approach to business development, first join the club and create a profile with your location on a global map. Then find out who is ‘your ideal client’ which we will cover in this episode. In next week’s episode, we will go through how to create engaging marketing material and in future episodes, how to be picked ahead of your competition, how professionals and BD teams can collaborate strategically and effectively, how to build great working relationships with your contacts - and much more.

But first, find out who is your ideal client and the work you are best suited to.

Please list all the invoices you have delivered over the past three years against each client, the activity, the invoice date, when and how much was paid and who introduced them to you. Then, put them in categories: most profitable, good bread and butter, and not worthwhile.

From the above analysis, you can identify your ideal client profile and the work for which you are best suited. This should be aligned with the mission and vision of the organisation to which you belong.

It is then essential to know what other professionals serve your ideal client. If you are a professional who works for a hedge fund, what other professional services does the hedge fund need? A banker to keep the money safe, an accountant to keep track of it, a lawyer to move it around, and so on.

Then, look beyond your client to the beneficial owners behind the fund. Are they first or second-generation? Are they before or after a liquidity event? Where are they located? Who serves these beneficial owners?

Many Private Client Services, such as Will Drafting and Deeds of Variation, do not make the profits to justify office space in a City of London law firm. Therefore, decisions must be made about the work the organisation wants, its profitability within the firm's context, and whether it is better to form partnerships with other firms to which clients can be referred and vice versa when the opportunity arises.

An increasingly exciting trend is to see beneficial owner-facing professionals serve their clients in smaller firms, which pair up with the larger behemoths to get the best blend for the client.

UBS, for example, is the largest global private bank. It can provide stability, security, and diversification of services that other institutions cannot match. However, its value is measured to a great extent by the assets under management. This means investments that are in its custody, but it is unprofitable for UBS to manage these assets.

Therefore, UBS encourages its investment managers to leave the bank and set up on their own with their clients—provided that UBS retains custody of the assets. In this way, UBS outsources the less profitable and time-consuming aspect of investment management to its former investment managers, who can give their clients the attention they want while retaining assets under management at UBS. 

If these professionals work from home or have offices in a less prestigious location, the partnership may be able to provide meeting rooms and other facilities to complement their service.

Allen & Overy did the same with their private client department, which spun into Maurice, Turner, and Gardiner. This is a very successful arrangement. Allen & Overy keeps the work for which it is best suited, but by partnering with Maurice, Turner, and Gardiner, it can serve the best private interests of the beneficial owners of the organisations it serves.

Connections with other professionals in different industries or disciplines are vital. Professionals who work for the same client type in various disciplines are called Marketing Pods and are hugely valuable in creating diversification, extensive distribution channels, and inroads into other markets.

Caroline’s Club provides online training as part of its membership package and face-to-face coaching to show its members how to use client mapping and its integrated, strategic business development platform to build good working relationships with other organisations that serve clients in different ways and trust with clients.

But before we end this episode, we will briefly discuss trusted client relationships. Go back to the analysis of your bills over the past three years. How many of your bills were paid in full and on time without complaint?

If your clients are not paying your bills in full and on time, the relationship is distrustful, and you need to find out why.

A simple tip is to ask for feedback at regular intervals and at the end of a project. This simple method lets the client tell you where improvements can be made. 

I did some research with clients about how they would like their lawyers to provide them with better service. One hundred per cent said they wanted their lawyers to give them progress reports regularly.

I shared this with 40 lawyers and followed up in six months. Not one lawyer had adjusted their work to take into account our findings!

The other advantage of feedback is gathering satisfied customer quotes. As we will find out in future episodes, satisfied clients' quotes are excellent social proof of third-party endorsement and make you as a professional more likely to be picked by a prospective client or professionals wanting to work with other professionals with the same client types over the competition.