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Between 2005 and 2011, IMC published Daily Tips every weekday on consulting ethics, marketing, service delivery and practice management. You may search more than 800 tips on this website using keywords in "Search all posts" or clicking on a tag in the Top Tags list to return all tips with that specific tag. Comment on individual tips (members and registered guests) or use the Contact Us form above to contact Mark Haas CMC, FIMC, Daily Tips author/editor. Daily Tips are being compiled into several volumes and will be available through IMC USA and Mark Haas.

 

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#132: Testimonials

Posted By Mark Haas CMC FIMC, Tuesday, September 15, 2009
Updated: Wednesday, September 16, 2009
What kind of testimonials do clients find most compelling?

Remember that consultants sell competence but clients are buying for confidence. A testimonial is one way to lower the perceived risk that the intangible consulting services a client is about to buy are plausible, realistic and risk free (or at least "low risk"). While you, as a consultant, might like to hear about all the wonderful experience and skills you bring to the table, when you ask for a testimonial, think more about what a risk-averse executive or manager needs to hear.

First, consider the greatest value your clients have received. What have they said was the most important benefit you provided? Then build your testimonial around that. Consider including the following (in a sequence that works for you):
  • The project issue or challenge (the preamble for why consultant services were required)
  • The intended outcome of the engagement (the value provided)
  • The actual outcome (especially longer term, in unit terms of dollars, output, or other measure that might translate to a prospective client)
  • The reason the client selected your firm (this is the key element to convincing the next client why they should select you, and should include why any reservations were quickly overcome by your performance)
  • The core strength you brought to the project (what aspect of your firm's offering you want to highlight)
  • The reason the client selected you above other consultants (here is the second most important aspect of the testimonial to induce your prospect to select you)
Tip: There is some value to planning your "testimonial portfolio." Consider the range of compelling reasons you would like to place before a prospect. Since each testimonial can't realistically present all of these reasons, work with your client to create a testimonial that fills the gaps.

P.S. If you are soliciting a testimonial for a firm ratr than yourself, remember, clients are less impressed by a testimonial about a firm when it doesn't necessarily relate at all to the consultants proposed for an engagement. If possible, collect testimonials for the individual consultants on the team rather than the firm in general.

© 2009 Institute of Management Consultants USA

Tags:  brand management  client development  goodwill  marketing  proposals  prospect  referrals  reputation 

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#130: Overcoming Fee Objections

Posted By Mark Haas CMC FIMC, Friday, September 11, 2009
Updated: Friday, September 11, 2009
What do I do about the increasingly frequent, "I'm sorry, we just don't have the budget to fund this project right now" response to a well reasoned and sorely needed offer of assistance to a client?

The budget closing objection is similar to several others, including the implicit objection that your price is too high for the work or value proposed. It is about perceived value. This can result from not talking to the person who will benefit directly from your intervention, thus a lower perceived value than you want. Second, you may be facing a competitive pressure from other vendors of services, even attorneys, accountants and engineers, all of whom may be facing market pressures to lower their fees. Third, this may just be a negotiation technique to see how much money the client can save (we are not the only ones who use "closing techniques").

Assuming you are talking to the qualified buyer and the one whose problem you are solving, it is critical to find out how much your services are worth to the client. One way is to not beat around the bush and just ask, "I understand you are cutting back on many investments, so tell me how much budget is available to improve sales efficiency by 20% (or whatever you are proposing)?" If the answer is "none" then your conversation under these terms is pretty much over. Either another service, another outcome or another buyer is called for. If they say "around $40,000," then you can, without cutting your daily fee if you are charging on a time and materials basis, start the discussion about trimming services to available budget. You should always be prepared with alternative formulations of your project (e.g., what could you do for 25%, 75% and 150% of your proposed fee).

Tip: Budget objections are always tied to value. If your client was sued, they wouldn't say, "We just don't have the budget to defend ourselves," or if there was an office flood, they wouldn't say, "We can't afford to clean up the damage." Your services just need to be altered to find that value.

© 2009 Institute of Management Consultants USA

Tags:  customer understanding  marketing  proposals  prospect 

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#129: Remember That "The Decision Maker" May be More than Just One Person

Posted By Mark Haas CMC FIMC, Thursday, September 10, 2009
This has happened twice in the past year: I reach an agreement with a prospect on a project, only to be told that "the management team" or "a project review committee" has decided not to go ahead. How can I keep this from happening?

There are two likely sources of this outcome. One is that you were really not talking to the fully qualified buyer. If someone does not have the authority to "issue the order" to start your engagement, then you should find the person who does. However, the model of a single qualified buyer may be flawed. It may be that the person was qualified as an individual but that, in your case, the decision does not rest with a single individual. If "the management team" is making the decision, you need to be addressing the team, or at least the most influential members of the team, with your proposed value and approach.

Tip: If a board of directors or management team is making the decision to retain you, see if you can get some time in front of the entire group before the decision is made. This gives you some sense of who members are as individuals, their decision style, how they interact, and (hopefully) their disposition to using consultants and their attitudes about the situation or problem you propose to address. In addition to collecting market intelligence about the organization, issue and decision makers, it may be appropriate for you to presell or discuss your proposed approach or value with the board. Don't leave it to your prospect as an individual to convey your message to the decision making body as a whole.

© 2009 Institute of Management Consultants USA

Tags:  market research  marketing  proposals  prospect 

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#119: Managing the Consultant's Social Networking Image

Posted By Mark Haas CMC FIMC, Thursday, August 27, 2009
I know that employers now examine a candidate's Facebook page to glean insights into their character. Do you think clients do the same for consultants they are considering retaining?

I am not aware of this happening but if I were researching consultants, I would look up their LinkedIn page first, then Facebook, then one or two others, depending on the industry or disciplinary focus. If I were the CEO of a nonprofit, I might look to see if they had a presence on Care2, or one of the newer business sites (e.g., Ziggs, Ecademy, or Focus).

These social networking sites are increasingly important because they are more regularly indexed by search engines (because of the constant addition of content) than most consultants' websites. So, when a client looks for "Pat Jones consultant supply chain security," they are increasingly likely to come across you in a social media site before your own website.

Tip: This is not just making sure your personal and company profiles are current and accurate. We've heard stories about job offers to recent college grads being rescinded after an employer saw their Facebook page, so we don't need to talk about profile content. However, of more interest to clients may be the dialog and ideas you provide in discussion forums. Your knowledge and perspective (and communication skills) are why your client presumably wants your services. Being part of the discussion in your discipline or industry can build your reputation, but flaming people or offering uninformed or poorly communicated posts can cause a client to have second thoughts.

© 2009 Institute of Management Consultants USA

Tags:  brand management  communication  marketing  networks  professionalism  prospect  publicity 

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#112: Performance Bonding for Consultants

Posted By Mark Haas CMC FIMC, Tuesday, August 18, 2009
I just had a prospect ask me for a performance bond. I know this is requested for construction projects but no one has ever asked me for one for consulting. Is this common, or becoming more common, for consultants?

A performance bond is a partial guarantee issued by an independent bank or insurance company to assure some compensation to your client if you do not provide the contracted services. You would normally either set aside or deposit funds in an escrow account in amounts equivalent to a minor portion of the account value (10% is common but the amount reflects the perceived risk of loss). The bond term is usually for part of the term of the project, usually up to the point of a major milestone, after which the bond is released.

A performance bond is rare for consulting engagements because most management consulting engagements are based on personal referrals and trust between the client and consultants. Also, the amounts at risk and difficulty of replacement are higher for construction projects than consulting. Ultimately, the nature of consulting, with few advanced purchases of materials and physical or facility-related activities, means that there is just not that much at risk for a consulting client.

Tip: If a prospect requests a performance bond, ask about their underlying assumptions. Are they new to using management consultants and thinking in terms of a construction contract? What, exactly, are their assumed risks? Can you provide convincing referrals from other clients whom you have successfully served without a bond? If there is so little trust that a performance bond is required, consider the implications of this level of trust on other aspects of the engagement.

© 2009 Institute of Management Consultants USA

Tags:  client  client relations  engagement management  goodwill  prospect  reputation  sales 

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