How Much Is Bad Client Management Costing You?

Scope creep: when you just can’t say no.

The answer to today’s question about client management should come as no surprise to you if you’ve been in this agency space for any length of time:

It’s costing you a lot.

Of course, your understanding of “good” and “bad” client management could be very different to mine, or that of my clients. But in my experience – both as an agency owner for over 11 years, and now as a coach to 350+ agencies – I’ve seen the same few errors being made by businesses all across the world.   

These errors aren’t always huge, obvious mistakes that are easy to fix. Sometimes they’re hard to spot – like a culture of just trying to please a customer at all costs.. And sometimes you think things are going just fine (despite all evidence to the contrary).

The most common trap I see agency owners & staff falling into – time and again – is thinking that you have to supplicate to clients in order for them to be satisfied. In reality, nothing could be further from the truth… and in this article, we’re going to unravel this insidious lie and expose it for what it is: a limiting paradigm that holds your agency back from being all it can be.

When Saying “Yes” Now Means Saying “No” Later On

One of the most commonly trotted-out business cliches is “the customer is always right”. We’ve heard this a thousand times from a thousand people, all repeating what they believe to be true: in order to make your clients happy, you have to give them whatever they ask for.

While that kind of mentality might fly in the retail or hospitality industries, it doesn’t apply to your agency. In fact, thinking that it does will leave you stressed out, underpaid, and even starting to resent the work you’re doing – all because you lack the ability to say “no” when it really matters.

In my work as a business coach, I’ve often found that there’s a disconnect between the vision of the owners/managers and the actions of their client-facing staff. For some reason, managers just assume that their account teams will know how to deal with clients properly, and so don’t offer them any substantial training on this subject (the kind that they need if you want your agency to flourish).

The basics of customer service are easy to pick up. They’re beaten into every call centre rep, retail employee and waiter/waitress in the country. But what about something more advanced? Something more appropriate for a high-value business like yours? It’s harder to come by.

Specifically, I’ve seen this disconnect between top-level vision and bottom-level implementation play out in the way employees handle client requests. Without being explicitly told how they should deal with a given situation, your employees will often defer to doing what they feel is best – abiding by the rule that “the customer is always right” and giving them whatever they want.

So when that client rings up and needs a particular piece of work completed on a short deadline, your employees agree to it, thinking that they have to say yes. They don’t think about whether this request is included in previously agreed fees, the fact they’re over-servicing this client, or that they’re creating unrealistic expectations moving forward. They just say yes because they were taught that the customer is always right – and no one told them any different.

And saying yes to this client’s demands mean that you can’t say yes when it really matters – when better opportunities come along, or when your dream client walks through the door. Instead, your answer is a no by default because you are already at full capacity with underpaying projects.

That’s what bad client management is costing you: the chance to build a better business, to serve your ideal clients, and to scale your agency into something that works for you (instead of the other way around).

And if you’re a one-person-agency, you’re not excluded from this discussion. As a solopreneur, you’re responsible for both directing your business with a big-picture vision… and for actually doing the hard work required to service your clients. The disconnect between how you want to handle your clients and how you actually treat them can often leave you stuck in a place you don’t want to be: working too long, for too little pay, with too much stress involved.

These same lessons apply whether you’re a solopreneur, leading a small team, or running a large agency – unless you learn to handle clients effectively, you’re going to limit your business and make life much harder than it needs to be.

Of course, over-servicing isn’t a big deal if it only happens once… but in my experience, these things don’t happen just once. Clients can get used to having work done on demand, so they start to send in similar requests more often. Gradually, their respect for your processes, your business and your time start to erode.

After a while, you’re not two partners working together on a mutually beneficial project anymore. Instead, you’ve been forced into a supplier/customer relationship, where you have much less power than your client.

While supplier/customer relationships work in certain industries (i.e. if your local supermarket only allowed you to shop by appointment, you’d soon find a new one), they’re bad news for your agency.

The work you do is valuable. It takes time, and you have many different clients to service. You can’t afford to let one client dominate your business – unless they’re big enough to warrant this attention, of course (although the dangers of ‘putting all your eggs’ in one basket is a topic for another blog post).

Instead of merely being seen as a supplier, you want to be seen as a partner: a trusted, professional expert that delivers valuable work from a place of equal respect. If you can successfully establish this position for yourself, then you’ll be able to get paid what you’re worth, waste less time racking up unbillable hours, and stop stressing out about the mounting obligations you never should have agreed to in the first place. The scales will be balanced, both sides perfectly equal to one another.

Establishing this position is easier said than done, however. There’s a number of different moving parts you need to consider.

  • And (most importantly) you need to make sure that your team are on the same page. If you position yourself as a respected, professional agency, but your staff constantly supplicate to clients, giving them whatever they want with no respect for their own time… what does that tell your clients?

It tells them you don’t deserve respect. That you’re not worth a premium price, and that you’re there to work for them – not with them, as equals.

I can’t tell you how many times I’ve seen this basic mistake cause problems for agencies aspiring to achieve more. Driven, ambitious top-level managers are a powerful asset – but without staff that are properly equipped with effective client management practices, they’re worth far less.

This is such a big topic and common conversation that I am excited to offer you some free on-demand training entitled The Client Management Masterclass. Based on my experience in the agency space (first as the owner of a 7-figure agency, then later as a coach and mentor to 350+ agencies across multiple sectors). I’ll reveal my Three Pillar Approach to effective client management, teaching you how to get paid what you’re worth, manage client expectations upfront (to avoid conflict and negative situations), and boost retention rates to supercharge your profitability. So if you would like to watch the free training, you can register here.

I’ve accumulated these client management best practices over the past 30 years, based on my observations of what creates the most impact for my coaching clients. Anything you learn here is proven to work across a variety of industries, and will likely be of benefit to your business too.

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