Keeping Customers Longer, Happier and More Profitable (Guest Post)

Ian Lurie

A note from Ian: Fred Janssen wrote today’s post. Fred is the most knowledgeable operations and business consultant I know. He worked with Portent and helped us totally turn around our customer service and management processes. In this post, he talks about choosing, serving and keeping customers.

Every business owner wants a diversified base of satisfied, profitable customers who are loyal to the business and who refer you to others like themselves. It certainly leads to more money, and it also leads to more time to do the things that you really want including a better nights’ sleep. Successful businesses usually start strong in this area. As they grow, however, it is common for customer relationships to become a bit more hit-and-miss due to poor communication, inconsistent procedures, inadequate systems and lack of accountability. Throwing more people or technology at the problem often creates additional chaos without solving the underlying issues.
Here are five things that I help to keep customers longer, happier and more profitable:

Choose your customers wisely.

  1. I recommend creating a customer success profile based on the attributes that you know will lead to successful projects and good relationships. Use it to evaluate every potential customer. Some potential customers should just be avoided and, while no customer is a ‘perfect fit’, if you are clear about areas of compromise you can manage the risks more effectively.
  2. Perform periodic reviews of each customer. In addition to the typical financial metrics, re-evaluate them against your success profile to see how well they currently ‘fit’. You may find that it is time to firmly “reset” a relationship or “manage a customer out” of your business.

Get the right people together to think through the details of your proposal before you present it.

Making the time to hold a structured proposal review meeting could be the most profitable thirty minutes you invest in a project. Include key employees who know the potential pitfalls to look for and who are willing to ask hard questions no matter who is in the room. You will go into the deal with a better chance of success and, if you do make compromises, at least you all go in with your eyes open.

Follow a structured process of internal and external communications before the work begins.

  1. Create an Internal Customer Profile that includes useful “intelligence” and insights gained from the sales process such as: who are the decision makers and what do they expect from the project; who are your strong supporters and who are not; what are the unique qualities of this customer (and project); why did they choose you over your competition. Use this in conjunction with the contract as the basis of an internal kickoff that includes every relevant group (i.e. management, accounting, production, support). You will save a ton of time and energy down the road if you make the effort to get everyone in the same room at the beginning to hear one version of the truth.
  2. Provide your customer with some sort of welcome document where you introduce your team, explain your processes, let them know what they can expect from you and what you need from them for the project and relationship to be a success (there should be no surprises here). Then hold a kickoff meeting with your customer to introduce your team and make sure they understand the information you sent them. This is also the time to review the project scope, make sure everyone understands what “success” means and establish mutual responsibility for achieving that success.

Communicate in a proactive, consistent and honest manner throughout the project and relationship.

  1. This needs to be modeled as well as explicitly taught to your employees in order to become part of your culture. You can develop systems and procedures to support this objective, but it is the habits and behavior of your employees that make the difference here.
  2. In addition to routine status meetings with the customer, it is important to hold regular high-level meetings with the decision maker who may not be that involved in the day-to-day activities of the project. This is an important and valuable opportunity to see things from their perspective, build the relationship and realign the expectations of both parties.

Always follow through and follow-up.

  1. This is where so many companies fall short. Again this is a combination of training and modeling along with systems and procedures to create accountability. For example, when you deliver your product or resolve a problem make sure that you positively confirm with your customer that they consider it delivered or resolved.
  2. Schedule a follow-up after some time has passed since delivery. Make it personal; don’t just rely on surveys and email. You might find that initial expectations have ‘morphed’ into something that the customer now feels are unmet. Don’t let feelings sit there and fester – find out and deal with it. This doesn’t mean doing more work for nothing. It means clarifying and understanding and moving ahead on the basis of mutual knowledge and respect. These follow-ups also cement your relationship and are great opportunities to generate new business and get referrals.

While the specifics of each of these need to be adapted to fit different businesses and industries, if they are well implemented and maintained you will improve the value of your business.

fred janssen

You can read more on Fred’s web site:

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  1. For me this post couldn’t be more timely. After much back and forth with a potential client recently I came to the unfortunate realization that the relationship wasn’t going to work – it wasn’t the right type of client.
    After what amounted to probably 7-8 hours of discussion I’m politely ending the relationship. At the forefront of my mind now: I need procedures to preempt this situation in short fashion.
    Being a new business owner myself (just 7 months in) I admit I haven’t hammered these difficulties out as well as I should have by now. But I’m working on it – and your post has helped me along a little more. So I thank you.

  2. Thanks for the post, Fred. You made several good points. I remember hearing that you know when you’ve done your job right when you know who not to do business with. There really are some customers who are not worth the time and money spent trying to keep their business.
    Also, I completely agree with the need to follow up. Not only does this build relationships but it gives you a chance to repair anything that may have gone amiss and retain customers.

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