Leading Measures of Client Satisfaction
Source: Partner Insights
The following includes excerpts, reproduced with permission, from an article by August Aquila, CEO of Aquila Global Advisors.
Client satisfaction surveys are nice, but unfortunately they are lagging measures. They merely tell you how you did last year. Here are a few leading measures that tell you how you are doing during the course of the year:
- Number of personal meetings. Meeting with key clients on a regular basis helps you gather the necessary information to improve service and increase client satisfaction.
- Number of complaints. This can be a key indicator of how well you're serving clients, but most clients don't complain, they just walk away. That's why one-on-one meetings are so important.
- Service guarantees implemented. If your firm offers a client service guarantee, how many clients are actually requiring you to honor it.
- Accounts receivable. Happy clients usually pay their bills faster. Track the number and amount of A/R adjustments. Large or frequent adjustments may mean you're not spending enough time with clients discussing fees and your value proposition. Also track A/R aging to spot client dissatisfaction or problems with your collection process.
- Percentage of clients rating firm a 5. Find out the percentage of clients that think you're doing a great job, then work on the 4s and 3s.
- Client turnover. A high turnover ratio may be a sign of serious trouble, but it may also mean that you are culling your client list to get rid of unprofitable clients.
- Client referrals. A decline in client referrals over a period of several months is a sure indicator that service quality is suffering.
- Share of client's wallet. You may not be able to do everything for a particular client, but it's important to track the percentage your firm receives of each client's professional services budget. This amount should be increasing over time. Watch out for clients that begin to use other providers for services that your firm offers.
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From Partner Insights, Aquila Global Advisors, LLC, July 23, 2010, http://www.aquilaadvisors.com.