When I initially sat down with Michelle Golden River, Growth & Profitability Strategist and Founder of Fore, LLC, we planned to discuss advanced pricing and where the profession stands today. We began by talking about how CPA firms can switch from a time based billing model to pricing work in advance.
However, the discussion evolved into a conversation about relationships. Advanced pricing comes down to value - what value are you delivering to clients and what is that worth? To know that, you need to know your clients. To know your clients, you have to talk to them and build relationships.
Joey Havens, Managing Partner of Strategic Growth at Horne, dug deep into this concept with his blog post "What if I Really Am a Trusted Advisor?". In this post, Joey asks is that really what we should be aiming for? He ran his team through an exercise of what their current client experience was like vs. what the team wanted it to be, "We needed a litmus test to help understand our present reality around client relationships, experience, and level of service," Joey explains, and this is the test they began implementing:
List your top five clients that you serve as their trusted advisor across the top of five separate pages.
For each client, write down their strategic goals.
What does your client see as their biggest challenge or risk?
Write down the date when you proactively contacted and scheduled a meeting with this client and collaborated on either of these key issues or a possible opportunity we identified as the primary reason for the meeting.
Joey goes on to explain that through this exercise, his team realized they were not unlike most in our profession, excellent first responders. However, as a firm, they were not delivering on the "trusted advisor's" promise. It should be a collaborative relationship, providing significant value beyond fees, and being part of a client's "inner circle".
Before you can start talking about adding value and how to price that value, you need to learn more about clients. CPAs need to build relationships, which means having intimate conversations with clients, asking them questions, and really listening to their answers to find out how you can help. Michelle Golden River thinks about this at a deeper level and talks through the definition of "value" with me in this week's episode.