Archive for the ‘Networking’ Category

I had lunch yesterday with an old friend, Clare Murray. I say old friend as that’s how she described me afterwards in a tweet:

Terrific lunch today at 1 Lombard with old friend @bookmarklee

It did seem as if we were old friends and yet we met originally in 2001 in a professional capacity and have simply said hello a few times at meetings of the APP over the years. I think this was actually our first substantive conversation lasting more than 5 minutes since 2001.

I mention it on this blog because Clare displayed so many positive attributes of a good networker – that I think it’s worth using the lunch as a textbook example of ‘how to do it’.  We’ve all had occasions where a business lunch has been a struggle. This one wasn’t – not for me, nor I think for her.

Let me tell you a little about Clare first. She’s the managing partner of a niche law practice based in Canary Wharf – CM Murray LLP. Earlier this year she had her first baby and took about 4 months off work. She lives close to the office, with her husband and evidently loves her work.  Prior to setting up her practice Clare qualified at a leading national law firm and was subsequently a partner in a City law firm particularly recognised for its employment and partnership law expertise.

So what did Clare do that so wowed me yesterday?

• Encouraged me to talk about me before I could get her to talk about her. Ok, I made it easy for her! But she seemed genuinely interested in the story of my career since we last talked properly in 2001. She asked open questions, expressed concern and interest and evidenced her legal skill; friendly, professionally and easily.

• Responded openly when I asked about how she’d come to set up the practice a few years ago.  She avoided the trap we sometimes fall into – she gave me no sales spiel.  This was casual chat between ‘old friends’ who were catching up.

• Even though Clare had invited ME to lunch (actually her PA had emailed me to find a good date), when we moved to business issues her first question was about what she could do for me. She didn’t start by asking me how I could help her.

• When I asked Clare about her practice she told me about it in a really positive, enthusiastic and engaging way.  I learned about her lateral hires, the team spirit, the extra talent and spark she looks for in potential recruits and the types of clients they act for.  All very matter of fact. I was genuinely interested as it sounded different to many other employment lawyers I’ve spoken with. Let’s see what I can remember 6 hours later (when I’m typing this):
  • A focus on high level executives in the city banks based in and around Canary Wharf. CM Murray were the first niche practice in the area (it’s why they located there);
  • Expertise and a focus on advising the UK subsidiaries of US corporations on employment related matters; and
  • Specialist knowledge and expertise in partnerships and LLPs

• Of course CM Murray has expertise in more areas than this but Clare seemed to know, instinctively I think, that there is little point in talking about everything you can do over lunch. The same is true at networking events. How much can one person remember – especially about someone they’ve just met?  So far as i can recall,  Clare focused on just 3 key memorable niches and added that the firm also does a lot of work with SMEs too.  As I explained though – everyone works with SMEs. That acronym describes 99.9% of all businesses in the UK.

• When I asked what I could do to help her, Clare picked up on something I’d said earlier in the conversation (so she had been listening) and asked if I could think of any niche accountancy firms based in or near to Canary Wharf, City or central London who also have a focus on the same sort of clients as her – especially the UK subsidiaries of US corporations. Maybe they could collaborate and travel to the US to promote their practices together. We also joked about finding a way for her to expand her practice into her home town of Newcastle where her parents still live. But that’s more of a long term dream.

• We also talked about social media for professional advisers, my paid for talks on the subject, twitter (see @BookMarkLee @CMMurrayLLP and @ClareMary), blogging and holidays in Italy. Oh, and she inspired an amusing thought which will shortly appear on the Accountant jokes and fun blog.

Our lunch lasted almost two hours. The time flew by. It did feel as if we were old friends. I have a couple of things I promised to do by way of follow up. This blog post was NOT one of them. But as the day wore on I was reflecting on how enjoyable our lunch had been. I decided to share my positive feelings and, hopefully, in so doing, help others who may struggle with business lunches.  I don’t think I’ve ever felt inspired to do this before. And I doubt I’ll do it again.

By the way I’ve now checked back to CM Murray’s website.  My recollection wasn’t bad. In fact I now realise that during our conversation Clare spoke about the firm’s experience in dealing with the following as well as partnership issues and business immigration law:

• Board room disputes
• Executive bonus and departure issues
• Senior executive appointments and service agreements
• Expatriate and international secondment arrangements and disputes
• Large scale redundancy programmes

There’s another lesson. It’s unwise to expect the people with whom we network to remember all we say to them at meetings or over lunch. Despite my best intentions I still could not recall accurately the specialisations that Clare mentioned over lunch – or maybe I did and her descriptions were more focused than the wording on the website. Reading it now I do recall Clare mentioned them all. But I think she wisely summed them up into pretty much what I sumnmarised earlier.

A sole practitioner accountant recently asked how could he attract the ‘bigger fish’?
In effect he wanted to know how he could start to attract and win clients who would be prepared to pay bigger fees. He said he wants to more than double his average fee – moving from around £600 upto £2,000.

Here’s my initial reply:

What services do the ‘bigger fish’ look for and that you can provide? Are you looking to attract prospects with more complex affairs or those with more messy records?

What services would anyone want and be prepared to pay £2k for that you have the interest and ability to provide.

When you are networking are your stories and examples about small clients or big clients?

Do the messages on your website and marketing material represent the right sort of bait for the work you want to attract?

Last week I interviewed Daniel Priestley on a webinar during which we discussed ways in which accountants in practice can become more entrepreneurial.

One of the issues we touched on was the benefits of identifying a niche, or preferably a micro-niche.  Daniel made the point that this makes you more referable as it distinguishes you from all the other accountants. And this is a point with which I certainly agree. I’m always amused when I see a list of “areas in which we specialise” on accountants’ websites. In fact such lists are more often simply a list of all those areas in which the firm’s clients operate. As such they provide less evidence of specialist expertise than is ideal.

The same point arises when accountants try to describe all the things they can do when they announce themselves at a networking event. All this does is to make you sound just like every other accountant. And that means you’re BORING and not memorable. So the low rate of referrals and new work introductions that follows from such activities shouldn’t be a surprise.

Claiming a micro-niche involves focusing on something like: “Divorced women over the age of 50 who are worried about their finances.” That’s a clear memorable and distinct focus. It’s a micro-niche.  You probably are already finding yourself thinking of people who fit that demographic. If so you’re putting yourself in the position of someone who could refer work to an accountant who focuses on that micro-niche. And that’s why it can be so valuable to have such a focus. Clearly you should pick one that relates to your own experience. But PLEASE make it different to all the other accountants who (claim to) focus on SME businesses…. (yawn),

Daniel suggested that micro-niches might include reference to gender, age, level of wealth, location, income, beliefs, values or any other such distinguishing personal or business feature. Focusing on micro-niches also makes it easier for search engines to find you. This is relevant for when your target audience is looking for an accountant. Your micro niche makes you more referable, more memorable and more obviously a specialist from the media’s perspective too.

I had one further thought after the webinar had finished. And anyone who has ever worked for or met someone from a larger firm of accountants will be able to relate to this. Often their business cards will define the niche or area in which they work. They are not simply a partner or a manager. Often they are not simply a tax partner or audit manager. Their business cards typically identify an area such as ‘property’, ‘retail’ or ‘international’.  These are akin to niches. But I know dozens of property tax specialists in large firms and I have difficulty in distinguishing them in my memory.

The accountants (in any size of firm) who stand out are those who emphasise their own unique micro-niches.They make these clear on their websites, on their marketing material, when networking and seeking referrals and when obtaining media coverage.

During the webinar Daniel answered a couple of related questions:

a)  Can you have more than one micro-niche? Yes you can but it’s rarely necessary and will confuse people if you mention them both in the same conversation;

b) What about the work and opportunities you miss through focusing on a micro-niche? In real life you gain far more than you lose.

What do you think? Do you have micro-niche you’re prepared to share?

It seems there is a tricky balance to be made here. I’ve written previously about how networking, whether online or offline, can be an effective way to secure new clients of the type you want – just as long as those with whom you network know enough about you, like you, trust you and know the sort of referrals that can help you.

I’ve recently seen the results of some research from the respected Kellogg school of management in the USA.  The Price of a Billable Hour – Social networks affect transaction costs. The summary is dated July 2009 but the research itself seems to date back to 2004 and thus pretty much predates the rise of online ’social’ networking.

Nevertheless, this research highlights what may be a key disadvantage of networking – especially online where we are encouraged to include social and personal material rather than to have a solely business focus. (Although I would always advise caution and remind you that anything posted online will be there for all time. It could come back to haunt you if it is too personal, unprofessional or otherwise indiscreet).

To paraphrase one key finding, the research suggests that you will charge lower fees to your friends than to clients with whom you share no social interactions. And put like that it’s almost obvious isn’t it?

In the UK, Barristers are often perceived to be more expensive than solicitors and, in general, they are perceived as less approachable. Is there a correlation?

One conclusion that could be drawn is that you will end up charging lower fees to clients ‘won’ as a result of relationships developed through ’social’ networking. I wonder whether, for example, regular attenders at weekly BNI breakfast meetings charge their fellow group members the same fee levels as would be charged to new clients who are total strangers? Maybe any reduction in normal fees is justified if the client in question is a regular and reliable introducer of new clients.

I’m curious as to whether real life supports the conclusion drawn from the above research. And how you feel about it.

I’d appreciate your views as comments below or by email to the usual address.

* Relevant previous posts include:

• 10 top networking tips
• People do business with people they know, like and trust
• Why gaining advocates is important
• Networking for professionals
• Networking mistakes to avoid

This is a first. It’s the first time I’ve had something to blog where I can see how it could fit on any or even all 3 of my blogs!

• It sounds like a riddle or joke – so would fit well on: Accountant jokes and fun
• It includes reference to tax planning – so would seem well suited to the TaxBuzz blog
• On reflection though, the rationale for the post is related to my advice and tips for ambitious accountants.

Earlier this week I was chatting with a nice guy who has been on a sabbatical since taking early retirement from a public sector role. He is now thinking about what he’s going to do next and is quite happy to accept that he may need to start networking once he secures a position.

I suggested this was to confuse networking* with selling. He would be much better off to start networking asap. Networking to build relationships. Networking to identify ways in which he can help other people. And Networking to build a deep and wide network of people who know him, like him and trust him. This cannot be done overnight.

It’s the same with inheritance tax planning. Ideally one would do this at least seven years before dying. I’m not suggesting that you need to start networking seven years before you hope to reap the benefits. Of course not. It’s just that seven years pre-death is the optimum time to start inheritance tax planning. Of course it’s not possible as you rarely know when that seven year period begins. Still, if you leave it too late your inheritance tax planning may be ineffective.

So, returning to Networking: If you want to achieve promotion and advancement within your firm you will generally increase your chances if you are well known and liked before your name is first mentioned as a potential partner.  If you are thinking of setting up your own practice, how much easier would it be if you were already well known  in the local community – by people who could become clients, recommend clients or help you source trusted suppliers? You get the picture.

If you leave it too late to start networking you could come across as desperate, needy and ill-prepared. In effect if you leave it too late your networking efforts will be ineffective – for a while at least.

* Relevant previous posts include:

• 10 top networking tips
• People do business with people they know, like and trust
• Why gaining advocates is important
• Networking for professionals
• Networking mistakes to avoid

My friend Andy Lopata is a networking strategy consultant.   I’m not sure that anyone else looks at networking in quite such a scientific way. He talks about the strategy you adopt as in who you choose to network with and how you can ensure that you get maximum benefit from your networking. This is crucially a function of the extent to which you follow up, but there’s a great deal more to it than that.

Talking to Andy recently I was reminded of an earlier posting on this blog in which I referred to old colleague of mine who would go to lunch or have coffee with anyone, any time. He suffered from what I called the ‘you never know’ syndrome.  He thought that it was worth attending all and any networking functions and lunches as ‘you never know’ when or where the next piece of work would come from. If time were unlimited this might not be a bad ploy.

In practice we need to either be more discerning or to maximise the prospect of getting value from the ‘you never know’ meetings we fix up. So how can we do that?

There are two basic ways:

1. Pre-qualify

This effectively involves gathering a little info so as to enable you to pre-judge the person. If you value your time and/or you’ve plenty of work flows then you can afford to limit yourself to meeting up with people who fit certain criteria. These will vary depending upon your business and your service offerings.

2. Effective follow-up

My old colleague did very little by way of follow up so as to build on or develop new contacts. he sent an immediate thank you note but beyond that, not a lot. At best the business cards he collected were added to the firm’s marketing database. So his new contacts received newsletters and ‘Budget’ booklets each year. I doubt this is the most effective way to keep in touch (and have explained my reasons on the TaxBuzz blog: Overnight Budget commentaries – what’s the point?).

To improve the value of such encounters I have suggested that it’s important to follow up.  And when is the best time to do that? Well, you need to start BEFORE your first meeting and you also need to do it DURING the meeting. That way you can do it most effectively AFTER the meeting.

Before the meeting, check that you know what booklets, newsletters, info sheets, leaflets and freebies you (or your firm) produce and which might be of interest to the person you are meeting. If you don’t have any such things you may want to spend a few minutes, perhaps even on your way to the meeting, thinking about how you followed up on the last meeting you had with a similar contact (eg: another solicitor, IFA, banker or whatever).
During the meeting, listen to what your new contact is talking about and try to find a relevant time to indicate that you have something in the office that you think they will find of interest. Promise to send it to them when you get back to the office. It isn’t critical to identify what it is you will send them and you will rarely be asked either!
After the meeting, follow through on your promise. Don’t just send a bland ‘thank you for lunch’ note. Fulfil the commitment you made. Evidence your trustworthiness.

Keep track and make a note to follow up AGAIN a few weeks later. Send something else, even if it’s just a link to a website item or blog entry that you have seen and which you thought they might appreciate as it relates in some way to your conversation at the meeting. (You did make a note of those key topics on the back of their business card so you could remember this didn’t you?)

This approach to Follow Up will repay dividends and make those ‘you never know’ lunches, coffees and meetings far more likely to generate some valuable follow up for you.

Over the years I’ve noted that accountants typically devote more time to networking with contacts and strangers (effectively) than they spend helping existing clients.

We’ve all heard the marketing gurus explain that it’s easier to generate additional fees from existing clients than it is to secure new fees from new clients – people with whom we have no prior working relationship. And this makes sense doesn’t it?

All other things being equal, a client who already knows us, likes us and trusts us is more likely to agree to pay for additional services if we take time to find out their needs and problems, than is a stranger.

So why do so many accountants spend so little time ‘networking’ with existing clients? Instead they spend time at marketing meetings and networking with contacts and prospective clients.  Much of this happens outside of the recorded timesheet day of course.

In my experience this happens because of an edict (or simply a perception) that:

• all time spent with client must be recorded on the timesheet; and
• all time charged to clients on timesheets should be recovered.

Quite rightly accountants don’t want to be pressured into billing clients for ‘marketing and networking’ time. Equally the accountant wants to avoid having to justify write-offs or unbillable client time.

Such attitudes are ingrained in the way that many firms of accountants are structured. As a result existing clients feel that no one cares about them, that the clock is always ticking and that they might as well talk to someone else about new issues, problems and challenges.  In effect the accountant misses out on additional fees as he or she misses opportunities to find new ways to help their clients. And the accountant literally wastes time networking with strangers because this is more acceptable within the partnership than spending prospecting time with existing clients (without putting time on the clock).

I suspect this is less of an issue in the case of sole practitioners – unless their timesheet habits have simply been carried over from when they used to work in a larger firm.

Incidentally – when you spend time with clients – it’s best to focus on finding out from them what’s troubling them at the moment rather than trying to sell to them. Find ways in which you could help them and whether they would like that.

What else could you do to reduce the downsides of your timesheet procedures?

Many accountants attend numerous formal networking events on a regular basis.  This can be very time consuming and it will be a waste of time if you set out with the intention of winning new clients and securing new leads from every event that you attend.

Effective networking involves developing profitable relationships and that takes time.

Do you have a networking strategy?

One approach is to find ways that can help speed up the process whereby new acquaintances move up the tree from simply knowing you, to liking you and trusting you.

And one way to do this is to focus on securing just a small piece of one-off work whereby you can prove yourself before seeking to establish a longer term relationship built around recurring compliance work.

What’s your networking strategy?

To commemorate the fact that this has been International Networking Week I thought I’d share my ten top networking tips for accountants. I’ve addressed the subject many times before on this blog – most recently in the context of online networking websites such as Twitter, facebook and LinkedIn.

You can access all of the earlier posts, tips, observations and advice here by clicking on this link re: Networking and scrolling down the page.

Networking is not something covered by our professional training. But it has become a crucial part of professional life – other than for those lucky people who have a constant stream of high value work referrals of course.

Networking is one of the key elements of being a good ‘finder’ of new work so it forms a key part of my mentoring programme for ambitious accountants. I have extracted the following tips from that programme and hope that you will find them useful.

1 – Get in the right state, not in a right state.

Keep in mind that you want to gain some value and benefit from the time you are committing to attending the networking event. You’ll need to look friendly and relaxed if you want people to be comfortable talking to you.

2 – You will be more interesting if you are more interested.

We have two ears and one mouth so we should aim to listen for twice as long as we speak. The people you meet will be more comfortable talking about themselves than listening to you.

3 – Networking is about building relationships not about ‘getting work’.

People buy professional services from people they know, like and trust. You’re unlikely to meet someone who just happens to need your services that day. You will need to keep in touch and to demonstrate that you can be trusted. For example by promising to follow up with an email or supplying some valuable information in the next day or so. Then ensure you keep your promise and create further opportunities to keep in touch thereafter.

4 – “What do you do?”

Don’t pigeon hole yourself as yet another accountant who acts for small businesses. Practice answering the question in such a way that ensures you are remembered specifically and distinctly from all of the rest of your profession.

5 – Focus on a niche not a list.

Even those new acquaintances who are genuinely interested in you will quickly switch off if you try to identify all of the things you do or could do for clients. Equally they won’t remember the list so you’ll be in danger of making yourself more forgettable. In the first instance you need to focus on a key area/topic no matter how broad your expertise and experience.

6 – Flirt as you network

F is for FUN

L is for LAUGHTER or at least having a smile on your face

I is being INTERESTED in what other people have to say

R is RESPONDING to what other people are saying through conversation

T is TALKING appropriately not extensively about yourself.

7 – You’re not alone if you feel alone.

There will always be someone else standing alone who will be so pleased and relieved if you go over and start a conversation with them. The chances of rejection are tiny. Simply introduce yourself, ask them their name and what do they do.

8 – Listen to what people say; don’t try to sell.

You can only solve people’s problems or help them make the most of opportunities if you know what these are. That means listening and absorbing, not talking. If you listen well they’ll trust you and if you ask the right questions, you’ll uncover all the clues you’ll need in order to decide if you have something to offer them.

9 – Get the other person’s name and business card.

Don’t offer your card until you’ve got theirs; this avoids you seeming pushy. If you didn’t catch their name when first introduced, ask again. No one objects to repeating their name to someone who evidently wants to remember them.

10 – Follow up afterwards.

Having given up your time to attend the event make sure it is worthwhile by keeping your promise to follow up with each of the people you met. Even if you think that they may not be the most valuable contact remember that you don’t know who they know who could be interested in what you do.

These are just ten of the many issues that are commonly misunderstood when professional service providers go to networking events. Most of the points may well be common sense – but that doesn’t mean they are always common practice.

This is the inevitable follow up to my recent posts: Twitter is not for accountants, If you’re not on Facebook you need to be on LinkedIn and Blogging myths for accountants.

I am probably one of the most active UK accountants on what are commonly referred to as ’social networks’.  I prefer the term ‘online communities’. Some have more of a social than business focus. Others are evidently only for business related networking. And some of these miss the fact that professional services (such as accountancy services and tax advice) are provided by INDIVIDUALS, not by businesses.  And People buy People.  The brand message, especially of the bigger firms, MAY provide a degree of comfort and reassurance but in the main the ’sale’, the engagement and the services will be attributed to individual advisers.   RELATIONSHIPS are not built up overnight – whether in a business or a social context.

That’s one of the reasons why I am so excited by the developments in online communities. It’s also one of the reasons why I started my own in 2007 (The Tax Advice Network) although it’s not as sophisticated as the more mainstream communities.  That’s deliberate as I’d like to think that I know and understand my main target audience (accountants in practice in the UK).  I speak to thousands of them at conferences and seminars around the UK each year. I don’t sense very much real interest (yet) in online networking and online communities.  When it happens I’ll be ready for it – or maybe I will inspire it?!

For the moment there are a few sites that facilitate and encourage accountants to post blogs  (but see my expose of Blogging myths for accountants), to comment on current news threads and to ask and answer technical questions.

I’ll write about these in a subsequent blog. I’ll also discuss and highlight some of the non-accountant specific business and social online networks and how accountants could benefit from becoming more involved with these – and how to do so without wasting loads of time.  But there’s no rush. None  will become mainstream for accountants in practice in the UK in 2009 (for much the same reason as to why Twitter is not for accountants.

What else would you suggest that I address on this subject?