The Over-servicing Epidemic: How To Push Back Without Losing Clients

None of us want to be busy fools working super hard to keep clients happy no matter what it takes. So in today's podcast I want to explore the hidden costs of over servicing clients. I want to share some strategies to establishing better boundaries and most importantly give you some ideas on how to shift your focus back to high value work that will accelerate the growth of your agency, give you a smoother journey and remove some of the stress that so many of us face because we we are over servicing. Now I want to record this podcast because I've seen so many agencies get stuck in that reactionary mode, spending too much time on non contracted extras that drain resources quickly and it becomes really difficult to get off this over servicing hamster wheel of doom. Now I recently carried out a poll with my audience asking them how much they overservice clients and perhaps you're not going to be surprised to know that the majority of people were in the 20 to 40% of of over servicing. And of course when we're heading towards 40% of our time given away for free, then we are in danger of being very unprofitable, being very unhappy, stressed, working long hours to earn a meager amount of money. So none of us want to be in that space. So I want to help you pull that back to a more manageable level of over servicing which I'll go into in the episode. So another super value packed episode and let's get going. I'm Rob Da Costa and this is the Agency Accelerator Podcast. As someone who has stood in your shoes, having started, grown and sold my own agency, I know just how it feels in the ups and downs of agency life. So this podcast aims to ease your journey just a little by sharing mine and my guests experiences and advice as you navigate your way to growing a profitable, sustainable and enjoyable business. This week I had my latest Agency Accelerator Live workshop which is a 45 minute value packed workshop that we run every second Wednesday, Wednesday of the month and this week our focus was on over servicing and it was one of the most attended workshops I have had with lots of really interesting discussions. So I thought I would record a podcast on the same topic. If you're interested in seeing future workshops and future topics for our Agency Accelerator Live workshops, then head over to dacostacoaching.co.uk agencyaccelerator live and you'll see all the details and themes for our next workshops and I'd love to see you there. So let's kick this off by giving a bit of a definition to what is over servicing. So basically it's when agencies provide services beyond the core contractual work without asking for any additional compensation. So some common examples of this could be doing some of the work that the client should be doing. It could be turning things around much quicker than you kind of agreed, or it could be the fact that you just seem to give them unlimited risk revisions. And of course, it can also be when they say, can you just do this? And in their mind, that additional task, which is outside of the scope of work, will take you 20 minutes, but in reality it takes two hours. And of course, can you just quickly add up and before you know it, you are over servicing by 20, 30 or 40%. Now, this happens for a few key reasons. Obviously, we want to be helpful for our clients. Of course we want to say yes. Of course we want to impress them and go the extra mile. And I think, especially in a challenging economy, we believe this is the best way of keeping a client. But in reality, it creates unrealistic precedents that become really difficult to maintain because of course, you have other clients as well. And of course, the second thing is that we fear saying no, especially more junior people in an agency. We fear that if we say no, the client will be unhappy and it will damage that relationship. But of course, often politeness and pushing back in a polite way can overcome this. And third, and perhaps the main reason why this happens is because we haven't spent enough time at the beginning of a relationship defining the scope of work and getting really clear boundaries in place. So that means obviously saying what's included and what's not included. But it also means outlining the service levels that you have with your clients. So if you're listening to this podcast now and suddenly you see an email pinging up in the corner of your screen and it's from a client, so you think, oh, I'll answer that now. Then you're sort of setting a preced. You will always answer their emails immediately. And of course, in future, when you can't answer their email immediately because you're with another client, then they are disappointed. So this all basically sets up expectations that are unclear on both sides. So you definitely need to sort of slow down to speed up to get really clear scope of working place and really clear service levels. So what is acceptable in terms of over servicing? Well, well, I think sort of 10 to 15% is acceptable because one month you might over service by 10 to 15% and you can probably claw that back in another month. And at the end of the day, we don't to be jobs worths. So we want to be able to help be helpful to our clients. But you can see from those poll stats that I shared initially that most agencies seem to be in the 20 to 40% of over servicing. So that's quite a lot more than 10 to 15%. So we need to tackle that. And of course, another big issue of over servicing is that it drains your resources really quickly. You're spending time on no value or low value projects which are going to lower your margin and it's going to create a disconnect between how busy you are and how much profit your agency is focused on. And of course, if you're spending time on free work, then that's time you could be spending on paid work. So let's just dig into this a bit more and I want to sort of reframe the concept of over servicing in a more negative language. So if you change the language from over servicing to write off, as soon as you make that shift in your head internally, it becomes a whole other conversation. Because at the end of the day, over servicing sounds like something that's really good and helpful, whereas write off sounds like something financial and bad. So we need to kind of change that language. And once we start changing that language, we can start to change our mindset. So if we've got a whatever it takes kind of mindset to over servicing, then it may well feel beneficial in the moment. After all, you're going to keep the client happy. But it carries many hidden costs that will compromise you and your agency's success. So first of all, the sheer time and effort it takes to spend on low value or free non contracted work distracts you from doing higher paid, core, deliverable work for other clients. Or indeed, focusing on winning other clients to fill your capacity with profitable work. And of course this creates pressure on everybody in the agency because everybody's workload gets bigger, yet the profits aren't coming in and the income isn't rising proportionately to how busy everybody is. And next, over servicing makes it much harder for you to raise your prices, because let's face it, if a client gets accustomed to these free extras from you, then why on earth would they ever want to pay for it in the future? So it becomes very difficult, almost impossible for you to have a price rise conversation. And of course, the overall impact on your margin and the morale of the agency basically makes it tough to grow. And as I said, there's a disconnect between how busy everybody is in the agency and how much Money is coming in the door. Now, the issue with over surfacing often starts with both us, and particularly with the client not being clear as to what a standard service is, I. E. Something that is included in the fee that they're paying for you. And what is an extra, that is a task that's beyond the scope of work. So it's super clear that not only are you clear about when you're doing an extra, but you're articulating that to the client as well. So they understand that on this occasion you're doing this for free, but in the future you may well charge them for it. So let's just dig into some thoughts around how to stop over servicing. So, first of all, and probably most importantly, you need to make sure that you are setting really clear scopes of work and boundaries up front with your clients. So you want to specify exactly what is included in a project, and you want to make sure that your client agrees and signs up to this. But also so do your team members so that they don't just jump when the client asks them to. And you also want to make sure you're really clear about your service levels. So, for example, don't always reply to clients immediately if your agreed response time is half a day, because if you always reply immediately, then when you don't because you can't, then the client's disappointed. So you want to get clear boundaries around the scope of work and also the service levels. Secondly, you want to politely redirect requests that are outside of the scope of work. So you might say this piece of work falls outside of our current agreement, but I'm happy to do it for an additional fee or I'm happy to quote you for the additional work. Thirdly, you want to educate your clients on what is their responsibility. So you also want to be clear about what you will and you won't handle. You know, you need to remember that this is a partnership, not an imbalanced customer supply relationship. And a partnership means that they have to do their side of things in a timely manner, as well as expecting you to. Fourthly, I think you need to regularly remind your clients about the scope of work in your monthly reports and your monthly meetings, and then just revisit this and the boundaries periodically, especially if you starting to see them get a bit blurred. And then the next thing is that you want to learn how to diplomatically push back and say no. Now, I think most of us think there are only two answers when a client says, can you just do this extra thing? And we always think the answer is, yes, we can, or reluctantly, no, we can't. But the reality is that there are five ways of pushing back to a client and five ways of responding. So you can say, yes, we can do that, you can say, yes, we can do that, but not until this date. You can say, yes, we can do that, but we need to swap something else out that we had agreed was in the scope of work. You can say, yes, we can do that, and this will cost you this much money. And of course, lastly, you can say, no, we can't do that. Now, there is a sixth one here, really, which is where you could say, we could help you get that done, but we need to outsource it to a partner. So make sure you understand these five or six ways of responding and so does your team, so that you're not always immediately saying yes to a client's demand, but actually considering it before you respond. Okay, so let's sort of wrap this up by talking about some tips around making this shift so that you can move away from that sort of 30, 40% over servicing back down to a more realistic, manageable 10 to 15%. So the first one is really, really intrinsic in all of this, and that is make sure that you find the right clients in the first place. We all know that when we find a client that isn't in our core niche and maybe doesn't fit our ideal target customer avatar, that they are really difficult to serve, they don't really understand us, we don't really understand them. And in order to do a decent job to keep them happy, you invariably end up massively over servicing them and it creates all the stress in the agency, as I've already talked about. So this starts off by making sure that you are really selective about finding your ideal target customer who not only fits in your niche, but also understands and values the work that you're going to do for them and understands their part in the whole process and is willing to pay a fair fee. These are your ideal target clients and it doesn't matter about anything else. If you get that bit wrong, everything else I've talked about today just won't work. Second of all, be really selective and conscious about when you decide to go above and beyond the contracted work. Determine what extras, what freebies you're going to do, whether they are truly adding value for the client or you're just rescuing them because they haven't done their part of the deal, and then get the conversation internally about write off rather than over servicing and make it clear to your clients that when you do an extra for free that a it's seen as an extra in their mind and B they understand therefore that you may well charge them to do that same thing in the future. Then third, diligently track your time that you're spending on non contracted extras. If you start to quantify how much of your capacity is being drained by this, it will really help you keep a handle on it and give you black and white indications of how much time you're spending over servicing. And of course when it reaches more than 15% for a client, you need to do something about it. Number four is to develop a referral or a partnership network of other specialists that you can handle requests to that are outside of your core scope, but nevertheless you're keeping it in your network, which means you're protecting your clients. And finally apply those five ways I said of saying yes or no to a piece of work. And also you might want to consider developing a sort of premium price service with additional fees for example for faster turnaround. I had to renew my passport this week so I had to send my old passport back and I sent it signed for and guaranteed delivery in order to be sure that it got there quickly. And I knew that it got there. And of course I had to pay quite a lot more for that expedited guaranteed service than I did if I sent it second class. And so consider applying the same thing to your business. Now if you make all these small shifts both in terms of practical ideas but also in terms of changing your mindset and getting this common language in your agency, then you're going to be able to focus on high value work with clients that respect you and you're going to be able to manage your over servicing, which ultimately means you're going to be able to drive growth within your agency whilst also maintaining really strong respectful relationships with your clients. So there's a lot I've covered in today's episode and I hope it's giving you some food for thought. And do make sure you've signed up for the next Agency Accelerator Live. The link is going to be in the show notes. And of course, if you enjoyed today's episode, please make sure you've hit the subscribe button. And please do consider leaving a review on Apple Podcasts because that helps the algorithm show the podcast to more people and it means I can help more people. And obviously I love hearing from you guys as well. So please do leave a review. But other than that I will see you next Thursday for the next episode of the Agency Accelerator podcast, Sam.