I received the following from a guy named Jeff. He asked -- One major challenge we have is managing "scope creep." Clients are always changing, enhancing, modifying, backtracking, re-hashing, deliverables and we seem less than great at controlling the associated costs. And the client does not want to pay. What do you do? Is it up front education? A formal contract, detailing the change-order process? We want to be easy to do business with, but we don't want to lose money either.
Well, Jeff, we certainly all know what this feels like. You try to be nice, and the other person just takes advantage of you, never reciprocating the niceness.
I invite you to think about how you would handle it if this were an employee, or a family member, or a friend or acquaintance. How do you deal with this in other walks of life?
You'll find that the key point is that it's all in the timing. If you were mad at your spouse, the time to raise an issue would not be when you were so desperate to solve the issue that you would lose your temper, or be under immediate pressure to get your way. Done then, you are almost certain to get it wrong.
But you also wouldn't raise the issue the first time it happened -- you would try to be supportive. What you would probably do, if this were a friend or a spouse, is to say that you don't want to fight about what has just happened, but only want to work out how you want to work together tomorrow.
You would say something like "I wonder if we could just go for a walk and talk about some things. Everything's really good now, but it would really help if we could work out some issues that are bothering me. Can we talk about the future?" Talking about the future rather than the immediate events really helps defuse the emotions, and allows a more sensible conversation.
In the world of clients, as in personal life, you can't take extreme positions.
On the one hand, you do have to try and be helpful and flexible and be willing to try and accommodate your clients' needs. But you can't keep on just being nice, because then you'll just keep getting exploited.
If you do, it's easy to predict that you'll get madder and madder, stop enjoying the work and then, one day, you are going to explode with fury, really telling that person what you think of them. (That's what happens in bad marriages where people can't raise criticisms about each other without giving offense.)
The answer, Jeff, doesn't lie in systems. It lies in the verbal and interpersonal ability to raise a criticism, while still being committed to the relationship.
Yes, it's wise to get agreements down in writing at the beginning of a business relationship, and also to agree (with as much non-legalistic language as you can) what would constitute a change of scope.
I think it wise to draft a chatty letter to clients saying the following -- (this is language I actually do use) -- "just to make sure we are both thinking about the project in the same way, I want to be clear that I will be happy to engage in additional activities such as (telephone calls and preparatory reading) up to XX hours. This represents my investment in our relationship. However, if what you ask me to do exceeds that amount of time, I will contact you to ensure that you still want me to do the extra work, and agree an appropriate fee for it."
This doesn't stop clients being demanding, but when they are, I then call to discuss things, using the following language (also a real example) -- "I hope you are happy with my work and that you think I am being helpful and client-centric. If you wish me to invest more time in this project, perhaps we can discuss whether or not it would be appropriate me to bill you for more investment time."
The choice is then theirs. Now, I don't want to pretend that this approach works in 100 percent of all circumstances. There are still going to be clients who will keep trying to get something for nothing, even though I have explained that I have "reached the limit of my ability to invest in the relationship." (Exactly the language I use.) If they still want additional work for no additional fee, I do walk away.
Everyone deserves a fair chance to work out a relationship, but I am not so desperate that I continue to work with people I know to be unfair and unjust. Not only is life too short, but I would rather accept the extra stress of developing other new business than be forced into accepting abuse and exploitation.
As always, I invite other people's experience and contributions. Is there more advice out there to help Jeff?
10 comments:
It's been my general experience that "over-demanding" (read: cheap -- pain in the ass types) can usually be identified up-front.
They start chiselling your terms right from the first day you meet them.
These days I walk from clients who begin fee haggling before I've even done one thing for them.
This approach has served me well over the years and I reccomend that you look back over the clients that given you fee grief.
I'll bet they were difficult to deal with right from the start in terms of money/ terms etc.
Patrick McEvoy
President
Rain Maker Best Practices
519-752-2669
Be Sure To Click Below and Get your FREE copy of:
"12 Secrets of Superstar Professional Service Firms"
Or Visit:
http://www.RainMakerBestPractices.com
I wonder if something I wrote a couple of years ago may be of help:
http://consultingacademy.com/a07.shtm
Thanks, David.
Definitely worth reading.
The problem I've had lately is not so much with clients expanding the scope of what I'm already doing, but rather clients assuming that because I've gotten one limited contract from them, I'm the equivalent of a full time employee that they can call on any time for a free consult and unpaid research.
Sometimes they are doing this to collect "bids" for a new job, but for some reason they think it's better to keep this secret from the potential contractor.
Or they do say they are taking bids, but what they are actually doing is getting free work that they justify as "proving yourself".
The thing I find most disturbing is clients who treat me in a paternal fashion even though they aren't paying me, much less regarding me as family.
For instance -- lecturing me on how being willing to "prove myself" is the attitude that will lead to success with their company while "holding back" would be a career mistake.
This sort of psychological manipulation is creepy even when you are a salaried employee: it's downright disgusting if your speaking to someone who gives you a 20 hour contract once in a blue moon. :-(
If I am understanding the problem, it seems to me that the key issue here is the ability to take control of the relationship.
I have had a number of these types of jobs over the years (maybe it's me??).
Each one was handled with varying levels of success.
What I realised after awhile though is although they are paying the bills, you are in control of the work that gets done.
The magic word is "no".
A lot of people have trouble saying it, but it is very powerful when a client asks you to do something (extra) and you give them a two letter answer followed by period of silence.
Try it next time you find yourself in this situation.
I actually find it kind of nerve wracking, but always feel much better once I have done it.
At the end of the day though, if you can't work with them in a mutually beneficial way, then it's probably time to work out who gets the Barry Manilow records and find another place to live.
Life's too short to work with people that don't respect you.
Hi, Timothy -- the problem is also that I'm uncomfortable being in control of the relationship.
I have a vague idea that people will like me, treat me better, and assign me a good reputation if they get the ego boost of being in charge.
My instinct has been proven wrong over and over again, yet it's still my first approach.
Living a life with dignity is a big theme of mine right now, though, and obviously this is one of the changes I need to make.
I did find a great cartoon that describes my situation perfectly: http://blogcharm.com/jimstroud/Comics
I think the point here is to actively seek out those clients that treat you well and avoid the ones that try to screw you for all you're worth.
If you can retain more of the former then you will not have to endure the discomfort of constantly haggling over scope with the latter.
Unfortunately the latter are more common, so you also need to have the inner strength to manage these clients to at least avoid commercial loss to yourself.
Over time, you should try to migrate away from the "bad guys" by gradually increasing the share of business that you win from the "good guys".
Here's a question: Why would you be worried about missing out on future work from a client that usually works you into a loss-making position?
I don't mean that you have to be rude when you push back, but you do need to be firm -- a little like dealing with a child perhaps (maybe this is not a bad analogy).
I think you will also find that by setting clear boundaries you will earn the client's respect, producing a stronger, rather than weaker, relationship.
My feeling is that you need to treat the client as your equal, not your superior -- not many people would want to earn a reputation as "the doormat"!
You're absolutely right that I need to stick to the position that I'm an equal.
The current situation is complicated by a couple of factors, though.
First, a good friend's son works for the company, and he was my connection for the work.
I don't want to do anything that reflects badly on him.
Second, the job is in an industry which I would otherwise have no access to.
The original hope was that their recommendations would get me more work in that industry.
However, I'm having increasing doubts that would happen.
Speaking of dealing with a child, Thomas A. Harris's "I'm OK, You're OK" and Eric Berne's "Games People Play" both provide great insights on what to do when your partner in a business situation is either acting like a child ... or trying to manipulate you into acting like one.
The short version (for the first case, at lease) is: do what Richard advises in the post above.
But if you like the longer version, you may enjoy the books.
Does Transactional Analysis still hold any currency in business circles?
Does anyone still read these books?
Or, if it has been recycled with shiny new jargon under the aegis of a Brand New Idea!(TM), can anyone tell me what the current incarnation is called?
Shaula, I haven't heard a reference to Transactional Analysis and Eric Berne's "Games People Play" in a VERY long time.
(Although of course, as always, that may say more about my knowledge than the state of business thinking!)
I always liked it (it first came out when I was in university) and found it helpful, even though none of my formal training was in the soft "psych" area.
As Shaula asked, does anyone out there still use it and recommend it to business people?
Post a Comment