August 2010
Customer Quote:
"This is a wonderful service. Please feel free to use us as a reference for any other advisors, RIAs, and/or B/Ds that are out there that are thinking about using your services."
Craig Phillips CFP,Managing Partner of Client 1st Advisors
Clients Insights Newsletter
Create Headlights for Your Business
A Client Satisfaction Audit
Retain and build your client base
Companies typically conduct an extensive audit to prepare detailed year-end financial statements. Financial analysis enables them to assess performance and understand the risks and opportunities in their business.
However, financial statements are based on historical data, providing a backward-looking business perspective. While these statements are a critical view of the business, financial statements are a bit like looking in the rear view mirror: they tell you where you’ve been. However, looking in the rear view mirror does not help determine the best path forward.
To take your business to the next level, turn on the headlights, and gain a forward-looking perspective of the risks and opportunities within your client base by performing a “client satisfaction audit.” You’ll assess these types of questions:
- To what extent is your client base vulnerable to competitive threats?
- Which clients, market segments, regions and products are at risk?
- Which clients are open to doing more business with your company?
- How can your company improve to better serve your clients?
- What steps must you take to insulate your client base from competition?
Launching Your Client Satisfaction Audit
The simplest way to implement a Client Satisfaction Audit involves creating a short, easy-to-take online survey to get qualitative and quantitative feedback from your client base. If you conduct annual surveys, you can track key trends in your business, such as the percentage of highly satisfied clients, client awareness of all the services you offer and product/service improvements clients would like to see. When properly constructed and executed, client response rates are very high; in our experience, usually 40-60% or more of all surveyed clients typically participate. Feedback is instant and viewable online in real-time.
A Client Satisfaction Audit can provide excellent data and insights you can use to grow and improve. Two important tools can then help you better understand the data you receive:
Client Risk Map:
A Client Satisfaction Audit can help you measure client satisfaction on two critical dimensions: satisfaction with your products/services and satisfaction with the relationship clients have with your company. If both of these dimensions are positive, you have a highly satisfied and secure client. If not, you may have a client at risk.
What you learn from your client satisfaction audit will help you take immediate action to retain clients at risk and deepen relationships with highly satisfied clients that are fans of your firm. As shown in the Client Risk Map, you can group data into four quadrants and easily spot, in a snapshot, where most of your clients are positioned. Each dot in this chart represents a client. The satisfaction audit will provide you with a list of clients that fall into each quadrant.
You can then review the feedback from each client and take action on a client-by-client basis to resolve issues and leverage business opportunities.
Perception Gap Analysis:
A Client Satisfaction Audit can also show how management perceptions are different from those of clients and customers. This insight will help you take action to close critical perception gaps.
For example, if management feels the firm rates a strong 9 (out of 10) on responsiveness, but clients and customers rate the firm a 3, you can take immediate action to revise your client service/support to close this gap. This type of data can be an important driver of needed business change.
Conclusion
To chart the best path forward, business leaders need both a rear-view mirror and headlights. A well-designed Client Satisfaction Audit is like headlights illuminating the road ahead, providing key insights about where your business is headed, so you can maintain or adjust course. Capturing quantitative and qualitative information on customer satisfaction can transform an organization from one that makes decisions based on incomplete and anecdotal information to one that supports a fact-based decision-making process.