Becoming More Market Driven - Getting Closer to Your Clients, with Suzanne Lowe
Presented by Suzanne Lowe
Contact firstname.lastname@example.org 
Tuesday, February 20, 2001
Visit the AccountingWEB Workshop Calendar  for upcoming sessions.
Would you like to see how professional service firms are trying to become more sensitive to the marketplace? Would you like to know the steps firms are taking to become more externally focused, and their early impressions about the effectiveness of their approaches? In this session, Suzanne Lowe reported on the findings of an extensive survey conducted over the last couple of months by Expertise Marketing in cooperation with AccountingWEB and a number of other organizations. Suzanne explains why firms need to Look Out, Dig Deeper, Get "Cultured" and Break Old Habits.
Read the complete transcript of the workshop.
Some of the other key findings included:
- The methods firms use to get closer to their clients fall into five different “cultural” groups, and these “cultural” groups are predictors of firms’ success at becoming more sensitive to clients. Specifically, some of the five cultural types have succeeded at using certain methods, while others with a different cultural type have failed at the same methods.
- There is a gap between firms’ rating of their own effectiveness at getting closer to clients and the methods they think will yield success. Specifically, some firms say they are highly effective at methods they think will not yield success, while others are ineffective at methods they say would yield success.
- Firms that do not have a market research budget say they are less effective in getting closer to their clients.
- Firms that do not practice data mining say they are less effective in getting closer to their clients.
February 20, 2001 Session Sponsored by Macola Software 
Session Moderator: Hello everyone and welcome! Today we are pleased to feature Suzanne Lowe who will be sharing information from an extensive survey conducted by her company, Expertise Marketing. Suzanne Lowe is the president of Expertise Marketing. She is a recognized expert in formulating and guiding competitively advantaged marketing, business development and management strategies for professional service firms. Her work is founded on the premise that differentiated expertise is a critical building block for success in the professional service marketplace. She provides her clients with insightful, practical and pertinent recommendations to help them effectively achieve their objectives.
Before founding Expertise Marketing in early 1996, Ms. Lowe spent more than a decade leading the marketing programs for top-tier management consulting and business-to-business organizations. Before that, she spent more than a decade managing and implementing strategies for political candidates and organizations. Suzanne writes and speaks regularly on the topic of professional services and marketing strategy. She speaks throughout North America to leading trade associations, industry groups and in-house firm audiences. She also designs and delivers customized executive education programs in marketing for professional service executives.
Welcome Suzanne and thank you so much for joining us today!
Suzanne Lowe: Thanks for having me. I also appreciate the collaboration with Accounting Web for working with us to conduct our study.
Today, I want to cover two broad topics, both parts of "becoming more market driven."
The first is the finding is from our nationwide study, of more than 500 professional service firms. I want to tell you about these findings, and generally and accounting-specific.
Second, I want to tell you about some conclusions that we've reached from the findings. Our study revealed six major findings about how professional service firms are getting closer to their clients. The first is, The three most frequently used methods to become more market driven are Delivering services, Changing professionals' behavior, and Managing client relationships. The four least used methods are Innovating our services, Using new approaches to compete against our rivals, Implementing market research, and Using alternative selling techniques.
Second: The methods firms use to get closer to their clients fall into five different cultural groups. They are Prepared, Flexible, Rule-Bender, Techno-Hunter, and Accountability.
Third: The five cultural groups are predictors of firms' success at becoming more sensitive to clients. Specifically, some of the five cultural types have succeeded at using certain methods, while others with a different culture have failed at the same methods.
Fourth: There is a gap between firms' rating of their own effectiveness at getting closer to clients and the methods they think will yield success. Specifically, some firms say they are highly effective at methods they think will not yield success, while others are ineffective at methods they say would yield success.
Fifth: Firms that do not have a market research budget say they are less effective in getting closer to their clients.
And Sixth: Firms that do not practice data mining say they are less effective in getting closer to their clients.
Suzanne Lowe: Does everyone know what I mean by data mining?
Harry D. Howe: Yes, using a database to extract and connect lots of info.
Suzanne Lowe: That's right, Harry. Data mining is defined as the practice of analyzing raw data in a database past trends and obtain future perspectives on strategic marketing issues such as market share, client purchasing patterns and the like. Now, I'd like to talk specifically about each of the six findings. Accounting firm specific use of market driven methods generally tracked along the same lines as the total respondents. But, when we compared a firm's effectiveness in becoming more market driven versus the methods that they think are most important, we found that accountants say they are not effective in using the three methods they say are most important.
Sam Patrick: How many respondents did you say you had?
Suzanne Lowe: More than 500 professional service firms. And 92 of those were accounting firms!
Suzanne Lowe: Accounting firms' three most important methods are delivery of services, managing professionals' behavioral change, and managing client relationships. Let me explain what I mean by each of those.
For delivery of services, we mean an accounting firm's use of specific techniques to try to get closer to their clients, such as, being flexible in their methodologies as a way to meet their client's needs. Or, co-locating their delivery of services to a different venue to deliver their services. Or, formal project checkpoints to enable client interaction. For managing professional's behavior change, we found that professional service firms are trying many different techniques to try to get closer to their clients.
Some of these include training programs, or communication programs, or career management coaching, for example. What we found here is that many of these programs are easily implemented and relatively safe, but the initiatives that are arguably more meaningful to the professional they are to affect, like incentives, clearer performance measures, and switching roles, are used far less! Third, managing client relationships, which was the method deemed most important by accounting firms. These methods include using software applications, like CRM, implementing specific client retention activities, or tracking and proactively working to build to "share of customer".
Accounting firms say they are furthest "behind" in using client relationship management strategies and tactics to become more market driven. And, accounting firms were twice as likely as the rest of our respondents to say that they were unsuccessful at delivering services.
Suzanne Lowe: Let's take a look at our second major finding. The methods that firms use to get closer to their clients are "Cultural". But we found that some of these cultural types actually can predict success at becoming more sensitive to clients.
Sam Patrick: Is it just my perception that law firms seem much more advanced than accounting firms at use of CRM and client relationship management programs?
Suzanne Lowe: Sam, are you a lawyer?
Sam Patrick: No -- an ex-advertising guy coming into the accounting marketing field...
Suzanne Lowe: Actually Sam, it' a good question. In fact, we did find that law firms are using data mining and CRM Much more than any of the other professions we studied. We found that 50% of law firms use data mining, while only 25% of accounting firms use data mining. And the data mining depends on a fairly robust CRM capability.
Michael Weber: What exactly is CRM?
Suzanne Lowe: CRM is Customer Relationship Management. It's a term that is more and more attributed to a program and/or software capability that firms use to gather information about their clients, track activity, and make plans to go to market based on the information they've gathered and tracked.
Suzanne Lowe: Do most of you have contact management databases at your firms?
Harry D. Howe: Yes, we use them. They also provide a structured process that is helpful.
Sam Patrick: We're attempting to build one now, but the going is slow and we've got pretty silo'ed information pockets.
Suzanne Lowe: CRM and data mining are inevitably linked. One can support the other.
Jen: We also use one. It helps with post-sales issues as well. Right. It's clear that to really manage a customer relationship effectively, and to data mine effectively, requires integrated information and somewhat centralized information.
Michael Weber: Which software is good? Goldmine? Act?
Suzanne Lowe: Let's skip ahead to our findings on market research and data mining, because these two concepts seem to be of interest to you. We found that firms that do not have a market research budget say they are less effective in getting closer to their clients. Let's assume that you have a contacts management database in your firm. It doesn't matter which program you use, Goldmine and Act are popular programs. The more important issue, however, is that you intend and actually do use your contacts database as a source for strategic information that you will use in a competitive manner to go to market. It should be much more than an address list.
The fact that firms that don't do market research say they're less effective in getting closer to their clients is directly linked to the fact that those who don't practice data mining are also less effective. For example, commonly cited client information that respondents from our study are gathering, includes basic client contact information, some personal plan information, including names of spouses or hobbies. Other information includes a firm's revenues, industry segments, years in business, and the like. However, the more important and more strategically relevant information could include things like a client's growth outlook, legislative issues that affect client's industries, price sensitivity thresholds, and the like.
Suzanne Lowe: This is where professional service firms can gain a leg up on competitors. If they were to track this information in their database and analyze it, the opportunity for catching the competitors asleep at the wheel, is large. We found some of our participants were in the very early stages of linking market research to data mining capabilities. But some were very sophisticated about this.
Suzanne Lowe: Before I switch to talk about some of our study's conclusions, I'd like to hear from all of you about how your firms use market research and data mining.
Sam Patrick: amazingly, despite being a top 40 firm, we have not really deployed either effectively in our marketing efforts historically. Research has been limited typically to D&B runs, periodic list development efforts, and very occasional client satisfaction surveys.
Suzanne Lowe: Client satisfaction surveys are a good step, but typically miss opportunities to gather information about the marketplace.
Jen: We also track fiscal year. This allows us to get to the client so they add our service to their budget.
Suzanne Lowe: Jen, that's a good idea, because that illustrates your firm's awareness of the buying patterns of your clients. Now, if you could add your perspectives about how your clients view your firm as distinct from -- or not -- your competitors, think about how many more opportunities you might surface.
June Landry: We conduct monthly client satisfaction surveys and client interviews
Suzanne Lowe: What other methods are you guys using to try to get closer to your clients? And, how effective do you think they are?
Ron: client advisory boards and one-on-one feedback…very effective.
Suzanne Lowe: What do the client advisory boards do?
Sam Patrick: Client interviews and we're implementing advisory boards in select markets.
Ron: 6 or 7 "A" customers discuss with a facilitator what they want from their CPA firm
Suzanne Lowe: Sam, what information are you gathering from these client advisor boards?
Sam Patrick: we're currently implementing programs, but our goal is to evaluate firm performance, identify their unmet needs, focus on market and industry issues for follow-up, and add value by bringing topical information to them
Suzanne Lowe: This is great! And also, a great segue into the conclusions from our study. Thank you, Sam.
Suzanne Lowe: To succeed, we believe professional service firm leaders must help their firms think about things differently from the way it used to be done. We find that professionals, accountants included, naturally tend to stick to what they know -- their craft. Of course, they love accounting, not marketing! And, our study found that most of these firms ARE taking small and simple steps to become more market driven. This is the good news.
But, small, simple steps are not enough in today's marketplace. Clients are increasingly sophisticated and competitors are working harder to out-maneuver their rivals.
Michael Weber: One on one meetings still garner the most relevant information to a good prober I have found. Lunch or Golf outings are OK, but when I went to job billing instead of by the hour billing, I found it easier to discuss additional issues with a client right on the spot and set the stage for additional services.
Suzanne Lowe: I've heard a saying recently that "a tiger that is not on the prowl, is a potential rug." And so, we encourage professional service firms to take more risks and do things differently. We know that taking risks and embracing uncertainty means possibly failing.
Suzanne Lowe: But not doing things differently, or working "smarter" to get closer to clients, is itself an unacceptable risk.
Ron: risk is where all profits come from, ultimately
Suzanne Lowe: Absolutely, Ron. But our study findings showed that the easy stuff is where most of the firms are comfortable, but they find that the easy stuff doesn't ultimately lead to successfully getting closer to clients. So, I'm here to tell you that you must MUST encourage the partners of your firms to push the envelope before they become the "rug."
Paul O'Byrne: It's easy for you guys to advocate risk, but if we were risk-takers, we wouldn't have gone into accountancy
Suzanne Lowe: So, there are four major initiatives that professional service firms should undertake. They are: "Look Out", "Dig Deeper", "Get 'Cultured'", and "Break Old Habits."
Suzanne Lowe: Let's talk about what I mean by Looking Out. For example, as you all conduct your client one-on-one interviews or convene your advisory boards, think about asking about the perceptions these people hold about your firm. Or, ask about the attributes that your clients and prospects find attractive. Or, find out about the decision criteria that your prospects use to select an accountant. Gathering this information doesn't have to be too risky. But, the rewards of knowing this information are great.
Here's another example of Looking Out. Find out about your clients interactions with your competitors. What are competitors saying about YOUR firm? How do their service offerings compare with yours? Ask firms that have never used your services the same questions. Then, compare the answers. Use the information that you learn to develop new ways to uniquely market and sell your services, and to serve your clients differently.
Sam Patrick: Sam Patrick -- we're in the process of developing a firm positioning, anchored by what our associates and our clients think and feel about the firm. We found it tremendously helpful.
Ron: Suzanne, does your study deal at all with pricing?
Suzanne Lowe: No, not this study.
Michael Weber: Suzanne, thanks for the info.
Sam Patrick: Suzanne, would you or anyone offer an opinion on who the "models" of the professional service firms might be in getting customer-centered and focused in all their efforts?
Suzanne Lowe: Sam's comments about developing a firm positioning are right on. This is a perfect way to get underlying information about clients and their interaction with competitors.
Ron: McKinsey and of the major consulting firms
Suzanne Lowe: McKinsey is a good role model, but the truth is, that what they do will work for them, but might not work for your firm.
Ron: oh, no doubt but for role model, they are good so is Disney.
Suzanne Lowe: It's more important to match your firm's "culture" with the methods, and therein lies the potential for client-driven success. The final two issues I would advocate are: to Get "Cultured" and to "Break Old Habits." Breaking Old Habits really requires asking uncomfortable questions and overcoming a reluctance to do things the way they used to be.
Our study found that many firms are making these steps into unfamiliar territory. If looking to McKinsey and Disney helps you lower your blood pressure to take risks, Go For It! The point is that it's going to be increasingly necessary to do new things to get closer to your clients, because if you don't, your competitors will. Thanks for coming today. Please feel free to contact me offline if you have any specific questions about our research. I can be reached at 978-287-5080, or email@example.com
Session Moderator: We want to thank Suzanne for providing us with all of this helpful information. AccountingWEB members can purchase and download Suzanne's Research Study directly from the AccountingWEB home site.
June Landry: Thanks Suzanne
Suzanne Lowe: Thanks AccountingWEB!
Session Moderator: You are welcome, it is always a pleasure. Thank you again, and good night!
Suzanne Lowe: Check our website, for a summary of the findings and a table of content. The study is meant to be information only, and probably can't be applied in a cookie-cutter fashion.
Suzanne Lowe is the president of Expertise Marketing. She is a recognized expert in formulating and guiding competitively advantaged marketing, business development and management strategies for professional service firms. Her work is founded on the premise that differentiated expertise is a critical building block for success in the professional service marketplace. She provides her clients with insightful, practical and pertinent recommendations to help them effectively achieve their objectives.
Before founding Expertise Marketing in early 1996, Ms. Lowe spent more than a decade leading the marketing programs for top-tier management consulting and business-to-business organizations. Before that, she spent more than a decade managing and implementing strategies for political candidates and organizations.
Since founding Expertise Marketing, she has consulted to the leaders of professional service firms throughout North America, from small start-up practices to large global organizations. She has worked with firms in numerous areas: a broad array of consulting specialties, accounting, executive search, legal services, employee benefits, construction management, environmental engineering, career management, foodservice, architecture / engineering / project management, and information technology services. Her work has allowed clients to win new project assignments and build revenues by developing new services, improving the effectiveness of their marketing plans, creating customized marketing and business development processes and tools, and gaining insights about their clients, prospects, competitors and market positioning.
Ms. Lowe writes and speaks regularly on the topic of professional services and marketing strategy. To do so, she draws on her consulting experience and her years of research on the marketing perceptions, practices and performance of a broad spectrum of practitioners and firms.
She speaks throughout North America to leading trade associations, industry groups and in-house firm audiences. She also designs and delivers customized executive education programs in marketing for professional service executives.
She is an award-winning writer and is a regularly published author. She has been instrumental in the development, writing and publication of four books, and nearly 40 trade and professional journal articles and book chapters for her consulting clients.
Ms. Lowe received a B.A. from Duke University. She is a member of The Boston Club, a forum for senior executive and professional women. She is a former member of the board of directors of Boston’s Big Brother/Big Sister Foundation.