two keys: education and incentives.
cross selling in most firms just doesn’t work as well as it could. it is probably the most talked about process in accounting firms and, undoubtedly, one of the most frustrating.
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firms constantly give referrals to attorneys, bankers, brokers and financial advisers, but giving a referral to a fellow partner or associate just doesn’t seem to happen. either firms don’t know how to do cross selling, or there are some other hidden reasons for the reluctance to give a referral to someone else in the firm. there is, of course, no miracle cure for this problem, but you can make cross selling more effective for your firm. here’s how.
cross selling is a process
one reason why cross selling isn’t very effective is that the firm’s business model does not focus on achieving results from this activity. cross selling, just like all other aspects of marketing, is process driven. the best we can do is develop or copy a process that appears to work in another office or industry and try it in our own firm.
with that in mind, here is an eight-step process to cross sell accounting and consulting services. each step in the process requires that you develop certain key skills and lay out specific mile posts so that you can have some an idea of the progress you are making.
the skills required may differ for each firm. when determining the skills that your firm will need, ask yourself the following question: “what world-class skill must we have in order to achieve a particular step in the process?” finally, a successful cross-selling process will also require that your firm break some of its existing paradigms.
cross-selling process – 8-step approach
- develop a cross-selling incentive program
- identify key cross-selling services
- create a team
- communicate and educate
- provide training
- create a communication program
- implement, implement, implement
- track, report, review, modify
step 1. develop a cross-selling incentive program
the first thing you need to do is factor goals for cross selling into your annual bonus plan. once that is done, understand the current obstacles to cross selling that exist in your firm, and start breaking them down. here are the most common obstacles:
1. fear and lack of trust: fear by the primary client-service provider who doesn’t want to risk hurting the relationship that he or she has developed with the client. there is also a certain amount of fear in turning your client over to the firm specialist. behind this fear is really a lack of trust in your fellow partner or associate.
every successful cpa i know has told me that no one serves his client as well as he or she does. and, i am sure this is true. but on the other hand, your partners will, for the most part, do an excellent job in servicing the client in these new areas. if you can turn your clients over to a lawyer, banker or financial adviser over whom you have no control, why are you so hesitant to put your clients in the hands of a fellow partner or associate? this is a sad commentary about the state of certain firms.
2. there are no incentives to cross sell: partners are too often compensated based on their book of business. therefore, it’s worth more to them to bring in new business that they can do, rather than to bring in business for specialist partners in the firm. they may receive very little in the way of compensation for doing an engagement for another partner. what happens is that these partners bring in new business, but it is substantially less than they could have brought in by cross selling the firm’s other services.
a firm’s compensation system needs to adequately reward partners and associates for cross-selling activities. unless this happens, the culture of the firm will be such that cross selling will not be considered important.
if you can determine the cost of acquiring a new client, why not pay that to a partner or associate who brings you one of their existing clients to serve?
3. ignorance: new accountants don’t know how to cross sell. i firmly believe that this is a valid reason why many cross-selling programs fail. the cross-selling process is not too different than the regular selling process.
- first, the client must have a need, and the accountant must be able to recognize it. you won’t find too many clients openly telling you their problems. you may have to probe a little.
- second, the firm needs to have the range of services and skills to effectively satisfy that need.
- third, the accountant must be familiar with all the services of the firm.
- fourth, the accountant needs to have established strong relationships with his or her fellow partners.
- fifth, the accountant must know how to transfer the relationship from himself or herself to the new service provider.
4. clients’ lack of a detailed knowledge of a firm’s capabilities: the only way to find out whether your firm falls into this category is to survey your clients. find out how many of your services your clients are aware of. ask yourself what you are doing to keep your range of services in front of your clients.
5. clients’ perception of your firm and what it offers: if your clients think of your firm as a traditional accounting and tax firm, they may not feel comfortable in using your firm for benefits consulting, valuation services, technology consulting, etc. your clients must have confidence in your firm’s overall abilities and feel that others besides their primary partner in the firm can provide them with the same level of service.
the key measures for this first step are to develop a cross-selling program for your firm with the proper incentives and guidelines.
step 2. identify key cross-selling services
most professionals don’t do a good job at cross selling because they just don’t understand the benefits of their specialists’ services. partners often feel that if they can’t provide the service themselves, then they can’t or won’t sell it. the best cross sellers are those who can discuss the broad benefits of the service with the client, get the client interested and then bring in the specialist to close the sale.
your firm will need to develop a list of the key services it wants to cross sell and be able to explain those services and corresponding benefits to its staff. remember, this is the list for which you can really provide exceptional service. just because a partner performed an engagement once doesn’t make him or her an expert nor does it give fellow partners the comfort level they need to refer one of their clients to the other partner. be realistic when you put this list together.
once the list is complete, think about the people who will provide the service. do they really have the technical experience to do the job? do they have the right relationships in the firm? are they respected as good, client-service people? if you answer “no” to any of these questions, you won’t be effective in cross selling that service.
you will want to develop a firm capabilities brochure. differentiate it from your firm brochure. the capabilities brochure highlights the various service areas and specific services that your firm can provide.
in addition to the brochure, you will want to set up on your network a database of key services by industry by individual. it wouldn’t hurt to have a short biography of the key service providers in each area as well as a listing of their completed engagements in the area. the more information your internal people see and draw upon, the more likely your cross-selling program will get off the ground.
step 3. create a team
corporate america has learned the power of creating teams and fostering a team atmosphere. unfortunately, the accounting profession lags in this important area. teams work because the members spend time together planning how their project will unfold. in most accounting firms, either the marketing director or the managing partner creates the cross-selling program. both often stand back and wonder why “their” program didn’t work!
teams don’t necessarily make the process move any faster. the team’s main goal is to improve the process. however, there are other unspoken dynamics that take team members away from their primary goal. team members will feel a certain loyalty to their departments. will their loyalty to their departments conflict with their loyalty to the team? will the team member feel like an insider or outsider? these and other emotions will affect all the team members.
teams go through four basic phases:
1. forming. during this phase the members determine what is acceptable behavior in the team. forming includes feelings of anticipation, optimism, fear, even suspicion. members really aren’t sure of much during this phase.
2. storming. in this second phase, team members begin to realize the size of the task at hand and start to argue about what needs to be done. many teams will fall apart at this stage.
3. norming. you might say that after the storm, comes the calm. team members start trusting each other, department loyalties are put aside and team members start helping each other achieve the task at hand.
4. performing. at this phase the team is making progress. it will analyze problems and create solutions for change.
some specific tasks that a team would look at in the team-building step of the cross-selling process are:
- introduce the team concept to the firm
- develop sales management leadership and accountability
- develop knowledge about the firm’s abilities
- develop relationships between primary service providers and specialists to make sure that nothing will be done to hurt the primary’s relationship with their clients
measure results
how will you know when you have achieved the outcomes of step three? you can use the following measurements to tell if you are on course:
- reports generated by the various teams
- surveys to determine if internal relationships have improved. you will want to do a benchmark survey at the beginning of your cross-selling program
- increase in cross-selling activities
- individual turfs and territories start to break down
step 4: communicate and educate
firm members must understand the benefits that each of your services can provide to your clients. the keys here are communication and education. first, your staff needs to be able to discuss in general terms each of the services that your firm provides (these are called the features of a service). second, they need to be able to discuss one or two benefits of each service. a benefit tells the prospect what’s in it for him or her. benefit statements normally begin with action verbs, such as increase, decrease, save, reduce, improve, protect, etc.
an effective way to teach your staff the scope of your services and their corresponding benefits is to hold staff meetings and assign to one or two staff members the responsibility of presenting a specific service and its benefits.
measure results: determine how much learning is taking place by testing your staff and tracking the number of programs you hold.
step 5: provide training
offer cross-selling skill-building seminars to staff and partners. cross-selling skills range from identifying needs in existing clients to knowing how to transfer the relationship from the primary service provider to the specialist. in addition, you and your staff will have to learn how to handle objections and understand the selling and the buying processes. finally, make sure you provide your staff with ongoing professional selling skills training. remember, everyone in the firm needs to become efficient in these skills, especially the partners.
measure results: determine comfort level of new skills and the degree to which partners and staff can apply the skills learned from the cross-selling skill-building seminar.
step 6: create a communication program
create internal and external communication pieces. the goal is to raise awareness and to get the firm thinking about additional services your clients may need. this is a slow process and will take an ongoing effort on your part to educate your staff. this can be accomplished through meetings, in-house newsletters, databases, industry and service brochures, positive talk about the firm’s colleagues, etc. the activities should be geared toward your staff and clients. too often, many clients just don’t know about all the services that your firm can offer them.
internal newsletters, for example, can be very effective in making your staff aware of specialty services your partners or senior managers can provide. a case study (or war story) is an excellent way of communicating to your staff what your firm has done and can do for a client. once the staff knows the “war story,” they in turn can tell it to prospects. this is a strong marketing tool that will help cross sell your services.
if your firm is large you might want to consider sharing department meeting minutes with other departments. for example, the tax department shares with the consulting group minutes of its meeting where it discussed the latest concepts in estate planning or shares with the entire firm the most recent changes in the tax law and how they can affect the firm’s client base.
as more firms advance with in-house technology, databases and groupware will help firms accelerate their cross-selling initiatives.
firms are accustomed to using client-satisfaction surveys but for the most part have not employed surveys that measure the clients’ awareness of the firm’s range of service, or their perception of the firm in each of these services. these surveys can also measure the clients’ needs in each of the service areas your firm offers.
measure results: track the number and focus of the internal and external communication pieces you produce and keep records of internal department meetings. also measure the change each year in the results of your client satisfaction surveys.
step 7: implement, implement, implement
implement your cross-selling program. if you have completed the above six steps, then you are ready to implement your cross-selling program.
some of the best times to discuss cross-selling opportunities with clients are:
- any time you meet with a client
- during tax preparation or a tax-planning meeting
- at the start or end of an audit/review engagement or consulting engagement
- at client workshops or training programs (a brief message about other services is certainly appropriate)
- during client interviews to determine what other consultants/accountants they have used and for what projects
all the above activities revolve around one common denominator – the individual accountant/consultant. setting specific, measurable goals for each professional in the firm will be a key to making your cross-selling program a success.
cross selling can also be done via indirect client contact. for example, you can email to clients announcements of new hires and new partners in specialty areas. you can email other information directly to clients (e.g., industry brochures, niche seminar announcements, etc.).
measure results: develop specific goals for partners and senior staff members. develop a direct mail campaign that promotes your specialty services.
step 8: track, report, review, modify
track and report results, review progress, and modify the program. most firms use a new client entry form that asks the necessary questions to protect the firm from taking on an unsavory client. firms should expand this form to include a wealth of personal information about the client, his or her family, a history of the business, the types of services used in the past, and what they are looking to achieve in the short term (two to three years).
if you are going to track and report results, make sure you create a consistent and quick reward/recognition program. monthly updates, cash rewards, etc. will help keep the interest at a high level.
measure results: in this last step you will want to have the following three measures: (1) a goal tracking system in place, (2) goals for the percentage of clients who are using additional services, and (3) the number of leads and appointments that your partners and staff are generating.
cross selling should be one of your richest sources of new business in your firm. if it isn’t, then your firm still has a long way to go to become truly and fully integrated. it goes without saying that there is no easy cure for the cross-selling malaise.
is your firm ready to break the existing cross-selling paradigm? as you can see, the process requires some major changes in the firm’s operation and a willingness on the part of all firm members to do things differently. line partners must understand their clients’ needs and be willing and able to sell the specialist’s services. unless these changes take place, your cross-selling effort will be just that – a lot of effort with no or little results.