Do not let bad customers drive out your good team members!

Do not work unprofitably.

Do not work unprofitably.

You may have heard me quote Ron Baker, “Do not let your bad customers drive out your good customers”. That statement is still relevant today.

We now need to be extremely mindful and action oriented that we do not allow bad customers to drive out good team members.

Let me explain.

The past 4 business days I have been contacted by 4 firms where the Partner asked me for advice regarding a team member who came to them after 9/16 (word on the street is it was very painful) and said, “Mr. or Mrs. Partner. I can’t work the hours anymore.”

Here are key variables: 

  • Mid to Senior Team Member who we want to keep in the firm and our profession.
  • Very committed Team Member.
  • Worked too much before (last tax season and previously) and 9/16 was the icing on the cake.
  • Getting feedback from their spouse that they are working too much (i.e. it’s hurting family life).

Summary: Situation Not Sustainable.

One solution to this issue is to improve our client service model: i.e. we need to dictate the terms of our client relationships: Do not work for clients who abuse your team members.

Abuse can be the form of providing disorganized books (you priced the job for organized books) or providing their information late with the attitude you need to get their return done (client has no empathy).

Do not work unprofitably!

We need to determine (a great exercise is to have your team help you develop Client Selection Criteria):

  • How we need their information organized (you can use pricing options to help with this).
  • When we need it.
  • Price the job properly (build in an extra 20% at least when you Price the job. Reminder: Come from a place of abundance not scarcity).
  • Build in timing penalties to your engagement letter (additional price after certain dates and no promises if the information is provided after a certain date).
  • Call them on any violations of your engagement (timing, scope, lack of empathy).

It is clear from my conversations some of our “hour’s problem” is due to tolerating bad clients.

The consequences of not managing our clients are material:

  • Working unprofitably.
  • Burns out our team.
  • We make more mistakes.
  • Can’t treat ourselves well (exercise/sleep/too much stress).
  • Hurts our family.
  • Drives good clients away.
  • Drives good people out of the profession.

Our mindset has to be one of abundance not scarcity and that we are absolutely going to upgrade or eradicate problem clients. The stakes are high.

Let’s be part of the solution not the problem. I am confident we can be.

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