[IMGCAP(1)]• What helps to insulate us against the rising costs of staff salaries? Growth.
• What helps to overcome the increased costs we are facing in health insurance and benefits? Growth.
• What helps us keep our best talent engaged and motivated? Growth.
• What solves our Baby Boomer succession challenges? Growth.
I look around our industry today at many of the key challenges we face and can’t help but notice how growth can help to address so many of them. But I am not talking about growth through M&A—I am talking about organic growth. I’ve heard the phrase “organic growth is dead” and I don’t agree. What I think is that we may have forgotten how to FUEL organic growth, which creates yet another challenge. The good thing is that formula for organic growth is actually very easy to master. It’s one part client development, one part referral source development and one part prospect development.
We know that it is easier to grow a current client relationship than it is to acquire a new client, but why aren’t we better at harvesting growth from our current clients? Statistics from a variety of industry surveys show that the more services we provide to any one client, the longer they will stay with our firm, yet we are still afraid to cross-sell. Other surveys show us that our clients want us to be proactive with ideas that can help their business (cross-selling) yet don’t understand the full scope of services we provide.
Finally, a key complaint from firms shopping for a new firm is a lack of proactivity on the part of the firm or engagement team. I don’t know about you, but I’m sold on the fact that cross-selling is a good thing and the client equates it to being proactive. Not to mention that it can fuel growth and long-term retention of clients.
Referral Source Development
We typically don’t have enough referral sources to grow our practices. Let’s say you have five great referral sources (I call them “A” referral sources) and each one of these sends you one client referral a year where there is an 80 percent chance you will get the work. This means four new clients a year. Last time I checked, we lose at least four clients a year, so if this is our only strategy for practice growth, we are in trouble.
Double the number of “A” referral sources to 10 and THEN you are in positive growth territory. And the best place to find additional “A” referral sources is within our current client’s circle of influence (their banker, attorney, P&C agent, etc.).
Who is on your top 10 list? The third component of organic growth is having an active target list that you are “working” every month. That is, you have an idea of who you’d like your future clients to be, and you are taking steps to penetrate those accounts on a regular basis.
Take this top 10 list with you to your client meetings and ask if they have any connections that might be able to open a door for you. Do the same with your referral sources and fellow partners, and make some outward attempt every month with each of your top prospects. It could be inviting them to an industry event as your guest, sending them a link to a seminar they might be interested in, or connecting on LinkedIn via a third party, among others.
In summary, the formula for organic growth is actually pretty straightforward when you think about it. And, because growth is the solution for so many of the problems faced in our industry today, it sure seems to make sense that we take a harder look at what we are each doing on a daily basis to drive organic growth in our firms. None of this is rocket science, but it does take diligence to implement. So, make organic growth a top priority for your firm in 2013 and let it (organic growth) take the pressure off several of the key challenges your firm is facing.
As the director of practice growth and marketing consulting services at Koltin Consulting Group, Art Kuesel helps firms grow and add millions of dollars of revenue to their top lines. Reach Art at 312-662-6010 or email@example.com.