When the American Institute of CPAs released its bi-annual Private Companies Practice Section CPA Firm Top Issues Survey last year, client retention was at the top of the list as the most significant practice management concern.

That may not come as a surprise, given the state of our economy, but for firms of all sizes, it was clearly a critical issue, competing for management's full attention with staffing issues in order of importance.

However, for smaller firms, this year has turned out to be especially challenging in terms of holding onto their clients, many of whom are shuttering their doors as a result of the turbulent economy, according to Barry Melancon, president and chief executive of the AICPA.

"I do think the smaller-firm environment is more distressed from the economy in 2010 than 2009," Melancon said. "Clearly 2009 was skewed more to the larger firms, and the smaller-business clients are having more difficulty in 2010 because they've had some difficult times for a year or 18 months and they likely don't have the staying power."

While keeping clients happy and satisfied has always been a priority for competitive firms of any size, the results of the survey affirmed the need to amp up communication and resources to maintain those close relationships. As a result, marketing initiatives and strategies to strengthen that relationship have come to the forefront, and finding creative ways to deepen client relationships is first and foremost in the minds of many in accounting firms. One such way firms are doing this is by investing time and energy into client surveys to gain instant, direct feedback on their services.

At Corbett, Duncan & Hubly in Itasca, Ill., it was a younger partner who brought the idea of launching face-to-face surveys to Bill Hubly, the firm's managing principal. Hubly supported the idea and the two of them conducted the interviews themselves.

The questions, which asked clients to rank the firm's performance in various services, came from previous surveys, and included open-ended questions such as, "What do you like best and least about working with us?" and "What suggestions do you have for us to improve?"

"One of the things we found out is that our clients were very appreciative of us coming out to them," Hubly explained. "The second thing was, they pay significant fees to our firm and they said they would love to have some fee concessions from us because it has been a difficult market and their business was struggling."

Hubly said that his clients were also looking for more information and advice on how to grow their business, as well as general information about their industry - in the form of seminars, e-mail blasts and newsletters.

"What we took away, as partners and managers, is that we need to get out with clients, outside the scope of the engagement to understand what is going on with their business," he said, adding that the process allowed him to meet clients he had never met before. "It was great to connect with them."


McKonly & Asbury in Camp Hill, Pa., created something similar. It introduced what it calls a "5-Star Client Survey," which allows a senior partner in the firm to meet with key clients - who aren't their own clients - to ask how they are doing.

"During this listening tour, we've learned many new ways to add value," said Scott Heintzelman, a partner at the firm. "We often gain a new perspective on our clients. Where one engagement team may ask the same questions or bring the same perspective, this new person has a very different view. Our clients have seen a lot of value in this process and we have been provided the opportunity to serve our clients in new areas."

Engagement partners at Sobel & Co. in Livingston, N.J., also talked with clients - their own - but for a different reason. They wanted to offer extra advice and guidance for those who were struggling to keep their doors open. "You could feel the pin dropping at the bottom of the well where we literally had clients calling and saying, 'My phone hasn't rung in three weeks, talk to me, tell me what I should be doing,'" said Sally Glick, a principal of the firm and chief growth strategist.

The conversations were dependent on the client's industry, how hard they were hit and what kind of options they had, Glick explained. "It was a strategic discussion about are you collecting your payables fast enough, is money sitting on the shelf, are you managing your inventory?" she said.

And while those conversations were happening, Glick also played up her firm's consistent programming to her clients - executive roundtables, an annual business symposium, more than a handful of programs geared towards the nonprofit community, and a bi-monthly women's group specifically targeted at women in high leadership positions. Glick also makes a point of nominating clients for community awards whenever they come up, which helped get her clients recognized on a larger scale.

"The whole point of that work is that we are trying to find the best ways to stay in front of our clients, as well as other business colleagues, adding extraordinary value on stuff that they touch everyday," she explained. "And to remind them that we are the providers and we go far beyond the financial statement, the tax return or whatever it is we offer."


Taking stock and focusing on current clients was also a strategy at The Bonadio Group in Pittsford, N.Y. Dubbing 2010 the "Year of the Client," the firm wanted to make sure their clients were both happy and getting all the services they could possibly need.

"We cranked up our service effort on every one of them, especially our top clients," said Tom Bonadio, the firm's managing partner, adding that a broad-based client survey was also distributed to nearly 1,100 clients. "Then we made sure everything was delivered on time, so from a service delivery standpoint we made an unbelievable effort to make sure that they had the right people on the engagement and there were no service issues. The No. 1 thing our clients brought to us is bring us more value, show us how you pay for yourself."

Despite offering increasing value to clients, firms still face tremendous pressure to lower fees in the hope of preventing clients from going elsewhere. Bonadio said that his firm's client retention strategy has always been strong, and while The Bonadio Group has been very sensitive to fee pressure and made adjustments as necessary, the firm did not lose more clients because of that this past year compared to other years.


"Our Big Four competitors are cutting fees and attempting to recapture clients they ignored over the past few years," Bonadio said. "And smaller competitors continue to use the fee card against us."

McKonly & Asbury's Heintzelman said that this is a typical response to retain clients during a recession - a strategy he is not fond of. "That is a weak response and very short-sighted," he said of lowering fees. "I am all in favor of working with clients during difficult cash flow times, but simply dropping price shows a lack of value."

Proving value is key, and at Heintzelman's firm, aside from creating five industry-specific blogs that coincide with seminars the firm hosts, an IT review was added as part of audit engagements to help identify areas of weakness and strength for clients.

"We then are able to give them a summary of these findings with suggested steps to 'tighten' controls," he said. "This, too, has been well-received and a wonderful value-add in our quest for client retention."

At Hildebrand, Limparis & Associates in Frederick, Md., keeping clients front and center took on a different spin - employees started telling "wow stories" at their regular meetings to help boost optimism.

"Each staff member talks about a client that they in some way were able to go beyond the expected service level and wow them," said Carl Hildebrand, a partner. "These stories set a positive tone to the meeting. The staff members are always looking for opportunities to exceed the level of service and tell their story."

Hildebrand said that the tactic works because it takes the emphasis off problems and recognizes the good things the firm does on a regular basis. The idea has spread to clients and when a client talks about how someone within the firm helped them, they are asked to right the word "wow" and the name the staff member on a piece of paper, sign it and send it in.

"Core values need to be reinforced if they are to become the culture of the firm," Hildebrand said.

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