Firing a client is a foreign concept to many - the theory being that any work/revenue is good. That is not always the case. While every effort should be made to salvage the relationship with your client, there are some situations where the management team may determine it is better to 'fire' the client than continue with the engagement:

Time spent far exceeds your revenue
Perhaps the deal wasn't structured correctly. Maybe you underestimated your time and resources or worse, maybe the client didn't tell you the whole story and the workload is far exceeding your original agreement.  Work with your client to make corrections through change requests to update your original statement of work (always document any changes!) - if that isn't successful, take a hard look at your costs and revenues. While there may be a strategic reason to continue the engagement even at a minimal loss, usually it does not make sense to lose a significant amount of money on a deal. In addition, you need to look at your opportunity cost - the time you are spending on your revenue-losing engagement means you have less time to spend on revenue-generating engagements and new business development efforts.

They are never satisfied
This luckily is not too common, but I have seen it happen more than once.  Regardless of the fact that you are meeting all your obligations, and perhaps even going above and beyond for your client, they are never satisfied with your efforts. It may be that the client didn't truly understand the product/service they were getting, there has been a change in management at the client and the 'new' person isn't as enthusiastic as the person who originally signed the contract, or it may just be a mismatch on both sides. Engage your account manager and senior management to work with the client and understand their issues - and work together to determine if you can win the client over.

Product/service is no longer part of your strategy
Perhaps your company has decided to drop a product line or service as part of your growth and long-term strategy.  As part of this decision, you will need to review which clients are currently using the product/service and when that piece of their contract is up. The best approach is to phase out the product/service gradually over time as contracts expire, but it is possible that in order to support your growth strategy it may be worth paying a penalty for ending your engagement early. Do this with great caution and always consider your overall relationship with the client, including how many other products they utilize and how long they have been a client. Once you have committed to ending a product line, be careful not to fall into the trap of selling it 'just one more time' or keeping the support 'for just this one client' - managing and supporting one-offs can be a very expensive endeavor.

Emotional drain on your staff
If a client is berating your team, it can really wear them down - and put your company at risk of losing good employees. There may just be a personality mismatch and putting a new team on the account can make a difference - not that the first team did anything wrong, just a better personality match (try to look for this when you're doing assignments in the first place). Your team will respect you if you stand up for them to a client who is 'bullying' and being unreasonable.

Debbie Millin is President of UpperLevel Solutions – a Boston-based firm offering part-time and interim Chief Operating Officer services, operational assessments as a health check or as part of due diligence, and executive
project leadership.

www.upperlevelsolutions.com

 


Comments


Comments are closed.