This is the first of three articles that explore how you can increase the number of incoming [and outgoing] referrals.
There is an old adage that tells us that no man is an island and in an accountancy business no accountant can operate without a network of those who have trust and confidence in you and your services. Another great component is to know those who like one another but that does not necessarily need to be the case in every relationship. But in that case then I suggest that there must be respect for one another.
Some of the key outcomes you should expect from your networking include:
- Increasing the number of people, you know and who know you
- Expanding the number of people, you can turn to for help and advice
- Networking keeps you in touch with service opportunities – that others offer you might be unaware of, and
- also allows you to contribute something to others – that is the principle of givers gain or reciprocity.
I know that networking is a term that is thrown around a lot. In this I would like to explore how accountancy professionals and business networking, connecting and socialising, can (firstly) facilitate your progression and secondly) help the development and growth of your business while also enabling you to bring solutions to clients from people that you know and trust.
1 Professional networking: which is all about forming important connections, contacts and interactions that will (1) help you to explore and develop relationships and (2) to enable you to be able to point clients in the direction of others who may be able to provide service, or information that is not readily available from you. Networking does not have to be only with other professionals.
2 Personal networking: I have enjoyed the privilege of serving churches and church members, but I hesitate to call that networking – in fact I honestly prefer to keep my church life separate from my business life. Personal networking traditionally helps you with expanding social circles and developing friendships. This includes clubs and other groups with whom you associate. This contrasts with professional networking which is far more focused on what everyone does, their industry, who they know and serve and where they are heading.
We are told that ‘it’s not what you know, but who you know that really counts’ and that is certainly relevant in the context of networking with other professionals. And, with the power of the internet at your fingertips, networking has become a lot easier too! But that is not just for you, it is also true for all those others who operate and compete in your marketplace. At the click of a computer key, you can find professionals who might be valuable connections for you, your firm and your clients.
3 Online marketing: with professional networks like LinkedIn are brilliant in helping us to track-down professionals who we can connect with. We will look again at that again in a forthcoming article.
4 Group networking: is often carried out at seminars, conferences, drinks receptions and even within the offices of larger companies. Networking internally, in large companies such as lawyers or bankers, can be just as beneficial at times. I can recall being invited to present a workshop to 30 HSBC bankers on a topic which if I recall was all about accounting standards – riveting stuff at the time.
I trust that by this point you have already gained inspiration and ideas about how you can improve your networking and the desired outcome of increased quality referrals
I mentioned in an earlier article that a firm owner should commit at least 200 hours to business development. That might sound a lot, but it works out to about 4 hours a week. The purpose of this course is to provide some answers as to how that time should be invested.
Let me start by highlighting 1 activity that focuses on building networking relationships:
Let me firstly approach networking tactics from the viewpoint of client service.
While advising a client there will almost certainly be occasions when the client asks for, or is clearly in need of, an introduction to a fellow professional. Typically requests for recommends drop into three main professions. That is, you are asked to afford an introduction to a banker, a lawyer or a financial advisor. So, in order to offer outstanding quality service, it is important to be able to point your clients in the direction of someone in each of those disciplines who you know and trust. Someone who has a proven track record of looking after and serving well those who you have recommended to them in the past.
I accept that you most likely already have well established professionals to whom you refer. But how many?
Over the years I have conducted surveys with about 150 of the partners with whom I have consulted one on one on their approach to business development. The results indicate that the typical partner has between 2-3 referrals. Based on: “Lloydbottom’s first rule of marketing” which I mentioned in the first session, the minimum number of referrals you should have is 6 and I am going to seek to persuade you that this should be yours also.
Whenever you make a referral you take a risk. After all your client might not get along with your referral. The risk in this instance is that your client might disapprove of the referral to the extent that they consider that you are so closely associated with that person that they decide to sever the relationship with you. The solution. This is a risk that you can minimise by offering the client two referral options. Then it is their decision as to who they appoint. The interesting point here is that if they meet with both of your referrals there are now two referrals that owe you a referral. For this is a sort of game in that if you make a referral, you can expect one back. OK, I know it doesn’t work out quite like that in real life but making two referrals does make all round sense.
So, having established the principle that you should have two referrals it is probably now easier to see how I reach my rule of 6 – that is with two bankers, two financial advisors and two lawyers. You may well have other professionals – maybe some of them are clients. Some accountants have IT consultants, web design agencies, surveyors and so on.
How many referrers do you have? Maybe not as many as you might think. Apply my six-month rule. That is if someone has not sent you a referral in the last six months maybe they are referring business elsewhere and they are not in actuality an active advocate and referrer.
Avoid referral overkill:
But, I suggest, it is also possible to have too many referrals. Developing your referral network means establishing trusting relationships that are proven over a period of time. I do not find too many accountants who have myriad opportunities to recommend. Therefore, quality is essential rather than quantity. Hand out too many cards and your colleagues will sense that this is just a numbers game for you. The key to what I sometimes refer to as the referral game is to build quality relationships with your fellow professionals. Watch a tennis match and the ball is hit from one to another. It’s like that with referrals, the best relationships are where there are referrals going both ways.
In the next issue of this blog we will take a deep dive into strategies that will 100% increase your referrals.