An Innovative Blueprint for Enduring Client Relationships
More than 15 million people in this country earn their livings by serving clients, and their numbers are growing every day. Unfortunately, far too few develop the skills and strategies needed to rise to the top in a world where clients have almost unlimited access to information and expertise. Supported by more than one hundred case studies and wisdom gleaned from interviews with dozens of leading CEOs and prominent business advisors, Clients for Life identifies what clients really want and lays out the core qualities that distinguish the client advisor -- an irreplaceable resource -- from the expert for hire -- a tradable commodity.
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Jagdish Sheth is the Charles H. Kellstadt Professor of Marketing at the Goizueta Business School, Emory University, and the founder of the Center of Relationship Marketing. He has served as an advisor and consultant to AT&T, Lucent, Motorola, and Young & Rubicam, and contributes regularly to The Wall Street Journal and other publications. He lives in Atlanta, Georgia.Excerpt. © Reprinted by permission. All rights reserved.:
What Clients Want
From Knowledge Worker to Wisdom Worker
The great professional helps you eliminate issues that are not a problem, and then he focuses you in on the really critical dimensions of the situation. You are permitted to be a bit confused and general. And at the right moment, the good ones ask the right questions. It's an iterative process; you don't want someone peddling a solution, who comes with an agenda -- which many do. The good adviser excels at the integration process, but he doesn't necessarily arrive at the solution for you. He knows my industry, but is broader than that. Finally, he can bring you comfort as well. Empathy, not sympathy.
Ray Smith, former chairman and CEO, Bell Atlantic
In January of 1941, President Franklin D. Roosevelt invited Wendell Willkie, who had lost his own bid for the presidency the year before, to visit him at the White House. Sitting in front of the fireplace in the Oval Office, Willkie steered the topic of conversation to Harry Hopkins, who was Roosevelt's most trusted adviser. Hopkins had been instrumental in helping Roosevelt clarify and achieve his objectives as president, undertaking sensitive diplomatic missions to meet Churchill and Stalin and providing sage counsel during times of crisis. Self-effacing, incorruptible, and enormously capable, Hopkins nonetheless drew fierce criticism because of his intimate relationship with Roosevelt. "Why," asked Willkie, "do you keep Hopkins so close to you? You surely must realize that people distrust him and resent his influence."
Roosevelt stared directly at Willkie and replied, "Someday you may well be sitting here where I am now as president of the United States. And when you are, you'll be looking at that door over there and knowing that practically everybody who walks through it wants something out of you. You'll learn what a lonely job this is and discover the need for somebody like Harry Hopkins who asks for nothing except to serve you."
The extraordinary advisers among today's professionals -- those individuals who develop breakthrough client relationships -- share many characteristics with Harry Hopkins, and they are as valued by their clients as Hopkins was by Roosevelt. Let's begin by looking at two in particular, James Kelly and Nancy Peretsman.
James Kelly: The Ultimate Corporate Troubleshooter
Management consultant James Kelly always seems to work a bit of magic with his top management clients. Having founded and led a major international consulting firm, Kelly now advises a small group of senior executives on issues ranging from corporate strategy to leadership and organization design, frequently shuttling between Europe and the United States. He combines deep expertise about corporate strategy development with a remarkable breadth of knowledge of other functional areas, such as finance, marketing, and operations, and then layers in empathetic listening, well-developed powers of intellectual synthesis, and keen judgment.
Win Bischoff, chief executive of the leading British merchant bank Schroders, has used Kelly as his adviser for eighteen years. As an investment banker and a company CEO, Bischoff is himself a master of the advice business, and a very discerning client. Talking about Kelly, he says, "What sets him apart is his genuine, deeply felt conviction; his bedside manner -- important here in Europe -- which is relaxed and nonthreatening; his empathy and listening skills; and the fact that he's able to see the big picture very clearly. Sometimes he offers specific ideas or solutions, but on other occasions he helps us arrive at them ourselves." Bischoff's praise is not surprising: over the years Kelly has pushed Schroders in some controversial directions -- encouraging it to stay out of the equity brokerage business in the United Kingdom, for example -- that turned out to be dead right for this highly successful merchant bank.
Sir Brian Pitman, chairman of Lloyds TSB Group and another client of Kelly's, echoes Bischoff's praise: "Back in the mid-1980s, Kelly and his team confronted us with an insight that proved catalytic -- that our cost of equity was higher than we thought, and we weren't earning it. This was well before 'shareholder value' became a buzzword or 'economic value added' was in vogue. He helped set us on a path to maximize shareholder value, and our market capitalization today places Lloyds TSB among the top five banks in the world."
Kelly hasn't always inhabited the heights of the boardroom, however. He vividly recalls selling accounting systems door-to-door in Harvard Square in the early 1960s, during his first few years working as a consultant for Dick Vancil, the head of Harvard Business School's accounting department. Some formative and humbling experiences -- for example, starting a European business from scratch -- helped him to evolve from a business expert to a business adviser by developing his empathy, knowledge breadth, and judgment skills.
Nancy Peretsman: A Relationship Banker Conquers the Internet
It's no accident that Nancy Peretsman, an investment banker who heads the media group for Allen & Company, was the financial adviser on $77 billion in mostly Internet-related deals during the first half of 1999 alone. In an industry where client loyalties can shift frequently and unpredictably, Peretsman commands an exceptionally loyal client base that she has developed during her twenty-year career.
A large part of her success is her ability to see the big picture. While other bankers are driving headlong into the next deal without pause, she takes time to reflect on the long-term direction of the media industry and the opportunities that may present themselves. "I operate in a somewhat old-fashioned way with my clients," Peretsman tells us. "I try to give them a world view about what's happening in and around their industries, and of the role that they might play."
Despite being a star in a galaxy known for big egos, and having been recently named one of the ten most powerful women in American business, Peretsman is remarkably down-to-earth. Instead of exercising her hard-earned right to lord over teams of associates working twenty-hour days, she still routinely rolls up her sleeves and dives into the day-to-day work of merger transactions. As we'll see later on, this has some unusual benefits for her clients.
While working in the United Kingdom on the financing of new cable companies in the late 1980s, Peretsman saw how they were planning to combine video and telephone services and thought this idea would make sense in the United States. Most of the early deals involving cable and telephone companies that she tried to market in this country failed, however, because the idea was just a bit ahead of its time (not anymore -- AT&T spent over $100 billion in 1999 to buy cable companies); but her clients have remembered her prescience at this and other moments, such as when she put her own money on the line to help finance Priceline.com, the now highly valued Internet company that lets you name your own price for airline tickets and hotels. Priceline's founder and chairman Jay Walker has said that "Nancy is the confidante of about twenty moguls...she is the last generation of investment bankers whose power is their long-term relationships."
James Kelly and Nancy Peretsman work in different fields, but each of them is an extraordinary adviser to clients, and each commands enormous client loyalty. They didn't start out their careers as great advisers; in fact, both of them can cite early difficulties in learning how to develop the long-term, broad-based relationships that they both now enjoy. But they learned from their experiences, and they developed and grew. In addition to their special areas of expertise, they've developed strong powers of synthesis and keen judgment. Like the other great client advisers we'll meet in this book, they are insatiable learners. They know how to listen. They balance selflessness with objectivity and independence. They have deeply felt convictions born of a well-developed value system. And they are able to build trust through their impeccable integrity and discretion. The result? Clients come back to them again and again.
Professional Services and Advice:
A $500 Billion Industry
Behind every great leader -- in fact, behind most successful individuals -- you'll probably find at least one great adviser. Alexander the Great's tutor and counselor was Aristotle, ancient Greece's famed philosopher and scientist. France's King Louis XIII chose as his chief adviser Cardinal Richelieu, who became the architect of modern state government; and President Franklin D. Roosevelt had the services of the trustworthy Harry Hopkins as well as the great General George Marshall. References to famous advisers in history and literature are contained in words like "éminence grise," "mentor," and "Machiavellian" which are now fixtures in our modern vocabulary.
Today, a group of over five million service professionals in a variety of fields, such as management consulting, law, banking, advertising, finance, and accounting, have largely replaced the clergymen and philosophers who once advised society's leaders. Collectively, these professionals comprise what is in fact one of the largest industries in the world with over $500 billion in annual revenue. If we include all professionals who develop client relationships, such as salespeople, the total number of individuals who manage and advise clients in the United States is close to 15 million.
Virtually all of the large service firms endeavor to develop advisory or consultative relationships with their clients, emulating those very few -- McKinsey in consulting, for example, or Goldman Sachs in investment banking -- that have a history and culture of building deep relationships. Stockbrokers are now "financial advisers"; accounting and consulting firms aspire to advise senior management, not just undertake reengineering projects; software programmers are referred to as "consultants"; and companies like Reuters don't just sell databases but want to be your "information adviser." Often, however, the words "adviser" and "consultant" lack substance and have a hollow ring to them.
Ironically, just at a time when the professions are experiencing their greatest growth in history, just as so many are striving to become trusted advisers, many clients are in fact dissatisfied with the quality of the advice they receive and the attitude of those who give it. It's getting harder and harder for them to find professionals like James Kelly and Nancy Peretsman.
But why? What holds professionals back from an undeniably attractive role that is highly valued by clients?
Barriers to Developing Breakthrough Relationships
Three barriers stand in the way of becoming a business adviser to your clients, and of experiencing the client loyalty and professional fulfillment that accompany this role:
1. Most professional service firms demand specialization. If you work for a large consulting or accounting firm, you might become a reengineering expert for the chemical industry or an auditor for automotive companies. This is fine for starters, but the problem is that the more expert you become in the niche where your company has placed you, the more "valuable" -- at least in the short term -- your firm thinks you are. This becomes a disincentive to providing you with other experiences.
While there is great benefit in developing a deep expertise, this specialization will eventually become a liability if you want to play a broader-gauge role with clients. Some firms recognize this issue and try to address it by systematically diversifying the experience of their junior staff, but many do not. (This push for specialization, by the way, is pervasive not just in the business world but in medicine, academia, science, and other fields.) In addition, while large firms provide tremendous opportunities and training for young professionals, they also have financial and growth goals that must be met (many are now publicly held companies). Sometimes, these short-term pressures override the long-term process necessary to build deep, trusted client relationships.
2. Expertise is becoming automated and reduced to a commodity. Ironically, while service professionals have been major beneficiaries of the late twentieth-century information economy, there are now signs that many types of expertise are losing value. Just as the industrial revolution replaced skilled craftsmen with low-wage factory workers during the early nineteenth century, the "expertise" sold by professionals is becoming easily replicable, more widely available, and increasingly cheaper in our Internet-speed, technology-driven economy. Already, the average incomes of some classes of professionals -- doctors, for example -- are starting to decline.
Several forces combine to diminish the value of expertise:
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Book Description Simon Schuster Ltd, United Kingdom, 2002. Paperback. Book Condition: New. Reprint. 208 x 140 mm. Language: English . Brand New Book. Business consulting and related professional services represent a 350 billion dollar industry- and they re growing in a huge way. But things aren t as rosy as this figure might suggest. All too many consulting jobs, are brief, one-shot engagements- situations by which most professionals can t survive. The most pressing concern today for six million professional advisors is this: In our bottom-line era, how can I make myself stand out and become indispensable to my clients for the long haul? CLIENTS FOR LIFE has the answers. Featuring interviews with CEOs of such leading corporations as Kodak and American Express, Sheth and Sobel, two of the field s preeminent authorities, outline a series of proven skills and techniques that seperate the extraordinary from the ordinary. Readers will learn how to build trust through consistency and reliability, balance professional independence with client devotion, practice crucial big picture thinking and much more. Bookseller Inventory # BZV9780684870304
Book Description Simon and Schuster. Book Condition: New. Brand New. Bookseller Inventory # 0684870304
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Book Description Simon Schuster Ltd, United Kingdom, 2002. Paperback. Book Condition: New. Reprint. 208 x 140 mm. Language: English . Brand New Book. Business consulting and related professional services represent a 350 billion dollar industry- and they re growing in a huge way. But things aren t as rosy as this figure might suggest. All too many consulting jobs, are brief, one-shot engagements- situations by which most professionals can t survive. The most pressing concern today for six million professional advisors is this: In our bottom-line era, how can I make myself stand out and become indispensable to my clients for the long haul? CLIENTS FOR LIFE has the answers. Featuring interviews with CEOs of such leading corporations as Kodak and American Express, Sheth and Sobel, two of the field s preeminent authorities, outline a series of proven skills and techniques that seperate the extraordinary from the ordinary. Readers will learn how to build trust through consistency and reliability, balance professional independence with client devotion, practice crucial big picture thinking and much more. Bookseller Inventory # AAS9780684870304
Book Description Simon and Schuster Ltd, 2002. PAP. Book Condition: New. New Book.Shipped from US within 10 to 14 business days. Established seller since 2000. Bookseller Inventory # IB-9780684870304