You never want to receive an unexpected e-mail from a very important client that reads “I need to talk to you at 2:30 today.” Particularly if he’s never sent you anything like that before. But that message landed in my inbox recently.
In my profession, investment management, we are judged on one of two metrics: performance and professionalism. As CEO, I am our firm’s toughest critic, but I know from examining published data from my peers that our performance has been very competitive. I also think that we’re very professional. I reviewed the client’s holdings, their performance, our previous correspondence and notes from our meetings. I found nothing alarming, but nothing particularly calming either. It took less than a minute for Stephen, the agent for an extremely wealthy family that hired us to manage a portion of their money, to fire us from the account, with no acknowledgment of our eight-year relationship. Stephen explained that they had hired another manager with a very strong track record, but he wouldn’t tell me who.
I’ve thought a lot about what we could have done to keep this client, and how to respond when a client leaves. In this case, my guess is that we hadn’t fully understood the client’s expectations. Or they had changed. I asked myself: What did this customer really desire if it wasn’t steady performance? One guess is we were not “sexy” enough. It kills me to say that, because I hate being typecast as the opposite: “stodgy.”
This led to my next question: Could my firm actually deliver what the client wanted? Changing the way we do business could alienate our other clients. Finally, I took stock of the damage done. While the absolute dollars were large, the percent of total revenue was relatively small. But I hate losing any business.
If you lose a big account:
- Ask the client why, and who they’re doing business with now.
- Ask yourself whether you understood their expectations, and if not, whether this was preventable.
- Evaluate whether your firm could or should try to meet their expectations.
- And ask yourself if this is part of a larger pattern, or just an isolated incident.
If it’s only one unhappy client, and you feel you’re meeting the goals of the vast majority of your clients, tell yourself you were lucky to have had the business “temporarily.” Losing a big client is never fun, but it’s as much a part of business as landing a dream account.
Karen Firestone is the president and CEO of Aureus Asset Management.
Karen Firestone