Sunday, June 1, 2008

The Importance of Professional Relationships

Building professional relationships and the pricing of professional services to customers can be rather complicated endeavors. Do both the professional and customer have a clear understanding of where the relationship should go? As for pricing, the easy way out is to take a rate-x-hour approach, which, when analyzed, is illogical. How do you place a value on an idea in that environment? How do you price the answer to a complicated question to the second customer when the research was done for the first? Does the amount of time it takes to perform a task always relate to the value of the task performed?

Our firm has adopted a value pricing approach which attempts to match the value of the service delivered with the price charged. Obviously, this is dependent on the value of the service as seen through the eyes of the customer. Intangible products (services) can sometimes be difficult to value if both buyer and seller do not have an understanding of the intimate relationship shared by dealers in intangibles. As the professional, we must appreciate the overall objective of the customer and not just wish to solve an immediate issue. This would be akin to being only concerned with the score at the end of the 1st inning of a 9 inning ballgame. Where do we want to end up? The customer must understand, and believe, that the professional truly cares about his well being and long-term success. The score at the end of the game is much more important than the score at the end of inning 1.

Experienced professionals and their business person customers have been educated in the “school of hard-knocks” and been told it is a “dog-eat-dog” world out there. In other words, we should be suspicious of everyone, even people that are supposed to be on our side. While agreeing that we should apply care in choosing with whom we associate, I propose that relationship building over a period of time will alleviate most worries in this area. As for the “dog-eat-dog” world, I am from rural south Mississippi and have been around lots of dogs and have never seen one dog eat another, what I have seen, and do believe, is that it is a “dog-sniff-butt-dog” world. They are suspicious only until they get to know each other.

The professional (the seller of intangible services) must truly be concerned with the success of his customer (the buyer of intangible services) and not just with getting paid on a project by project basis. This may sound like a “duh” type statement but most professionals in a rate-x-hour firm are short term focused. To be a valued advisor, the professional should spend as much time on the relationship as the specific project.

After all, when we are gone, what will be remembered…the fact that we got the project right?….or the fact that we were a true friend and cared about our customer?


elakin said...

I whole-heartedly agree, Tim. It is a "Dog sniff butt world."

katty said...

Building long-term relationships with customers increases the customer loyalty, and ultimately leading to more profits.
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