What are you selling – service or relationship?
Helastel is a strictly service company and our job is to sell “brains by desks”, our marketing team has a name for it: world class software expertise. If you are involved in some sort of service, you like myself, will keep asking yourself what is it that you can do to be better than others in your market vertical. This will come as no surprise that 90% of Directors will mention in their top 3 priorities something about relationships.
This ‘relationship’ word has been making me curious for the last 5 years, I really wanted to know what it actually meant and how can one make that ‘relationship’ work for your business. So I did a bit of research by talking to around 100 different directors in service industries.
Here is what I found:
1. How much difference can relationship make?
If you are not a bean counter like me, then the way to think about this is: Would you rather work every day with a room full of your genuine friends or in a room of people that feel as if you have met them for the first time and that you always have to prove something to them?
If you want a commercial model , here it is:
Let’s assume for every 1M GBP you turn over your margin is 10% then you take home 100K GBP. Now, imagine you went to all your clients and asked for 10% extra business that was marginal to you and you asked your suppliers for 10% decrease in cost or improvement in efficiency in their product and you got staff to come in 15 minutes earlier and leave 15 minutes later every day. By this point you are making 300K GBP profit on your 1M T/O. (Trust me, this is an astonishing figure, but the figures do add up). All of above you can do with relationships, so it does matter. Not only does it matters with your clients, but also with your suppliers and your staff!
2. Where do I get my ‘good relationship’?
You can’t buy this commodity. In fact, it is to do with business leaders’ mind sets. Businesses that are successful at relationships have leaders who care not only about the P&L, but they also genuinely care about their clients. They share the passion and the vision as if their clients’ business was their own.
I once observed an MD of an IT firm (T/O c55M GBP) flew around Europe around 5 countries in one week for their client because they were proud of product they made for them and wanted to be there with their client when they pitched the new product to world’s largest corporates. I know that MD personally, and he didn’t calculate P&L of that account and nor was he trying to please his client. The only thing he cared about is that he was passionate about playing a small role in changing his client’s life.
This isn’t a call to forget about business financials and do this for every client; however it is a demonstration of passion. Passion and care beyond the day to day hamster-wheel in the office. It is an absolute pre-requisite to get that ‘relationship’. It has to be genuine and it has to be strong. By the way, that MD subsequently sold his business, which he started from nothing, for over 100M GBP.
3. So you care, now what?
Caring doesn’t end at the leader. It needs to be precipitated into everybody else within the business and beyond. I have observed team building exercises in companies small and large. These exercises work in training for skill but a relationship is not a skill it is like an invisible fabric between people. That fabric has to be created and as a leader you are the only person that can do this in your organisation. This means that you need to first engage your employees with each other and then with the business on a personal level. You have to create trust or effectively build ‘a family’. Personally, in the last 10 years I found this the greatest challenge. Once you have achieved it, you can seed relationship values. The latter is normally an easy process as good leaders’ values tend to rub-off on the team quite quickly.
4. Keeping it in perspective
One’s passion can also be their demise. Building relationships is a great way to get a solid and loyal client base for your business. It is also important to keep a mind clear on the targets and use passion and relationship building to fuel achievement. If you are going to take the above route it is important to have a good FD with a cold head who will keep reminding you that you cannot always be flying around the world with your clients and that you actually have a job to do and targets to meet.
