104 How Accountants Should Lean Into Client Feedback

Nothing gave me sweaty palms when it came to running an accounting firm quite like asking for client feedback. I went the whole spectrum from I'm going to be honest, do I even care if you're not happy with me, can you just leave to actually the other end of the spectrum and like caring and listening and trying to get constructive feedback. So we're going to talk today about NPS Net Promoter Score. There's right ways to do it, there's wrong ways to do it. I think the way 80% of people do it. More than that, I think the way 95% of people do it today, it's pretty useless. So let's talk about it. Come on in. Water's warm. And let's talk about how likely you are to recommend this podcast to a friend. Okay? NPS NET Promoter Score. You've seen it. You encounter it in the wild a lot. It's the 0 to 10, how likely are you to recommend our what we do whatever product usually to a friend. And they kind of became, I don't know, I feel like maybe a couple of years ago I saw a ton of people talking about them for accounting firms and they were kind of the in vogue, edgy thing to do there for a while that the cool, progressive firms were doing. I think we've, we've maybe bounced back to. They're helpful like within certain contexts, like the devil's absolutely in the details. And you know this, if you've ever gotten that pop up on a mobile app that says, how are you enjoying this thing? And if you give a crappy review, it says, we'd love to hear your feed feedback. If you give a good review, it says, please give us a good review on this whatever app review platform. Right? So any sort of client feedback here has to be done very carefully. Otherwise you're just, I don't know, fooling yourself into something that isn't actually constructive and, and at worst actually just creates work and noise and not anything meaningful. So I want to talk about like, what I think the right ways and the wrong ways to do this are first just kind of setting some context. If you're not familiar with this one. So Net Promoter Score, like, the beauty of it is it's just this one single metric. Super simple. You're not asking that much of a customer. You're not putting like a big web form in front of them saying, how could we have done XYZ better? You can certainly do that. But the beauty of MPS is it's just a single number and they can submit anything from 0 to 10. Now some services like obfuscate that to be a poop emoji to a trophy emoji or you know, 1 to 5 or whatever you want to call it. But the traditional yardstick and MPS was 0 to 10. And if you're coming in at 9 or 10, those people are what are called your promoters, the most likely people to recommend you to someone else. If people are coming in at 7 or 8, they're what's called the passives, the ones who are kind of meh and everything six or lower are not likely to recommend and are your detractors. And oh, but if you're like me and you went into accounting because you don't like conflict and you'd rather talk to a computer than deal with hard things, then the whole notion of getting feedback, it all feels very personal. And I think most people don't do this just because it scares them. And as a result we can actually hide behind well, I don't care if they don't like it, they can just leave. When the reality is maybe we just don't want to have that hard conversation or aren't, I don't know, willing to come to terms with the fact that maybe we could have done something better. But this is not to me as linear as did I do good job? Did I do bad job? Many of these things and how happy someone is with you and what you do is also about like how well aligned are you to serve the problems of this particular person. We've talked a lot about how not everyone feels pains for the same things in the same ways. And oftentimes the person who's complaining about your bill, it's not because you didn't do a good job or because what you do isn't valuable. It's maybe there wasn't valuable enough to them and to the problems that they have. So ultimately the best thing we can do is be even better for a more specific set of problems. So this NPS wallet can feel like very one dimensional and linear. The reality is behind the scenes, I think there's a number of things that are impacting how people score this stuff. And like a basic example is like, what if I do accounting for people and we roll out this like, hey, we're going to start doing this sort of high level week over week cash planning for you and we're going to send that over for the clients for whom cash management is super, super hard. They're going to be like you the best. Thank you so much. Just made my Life much easier for the people for whom that's not a problem. They're going to be like, I don't really care about that, but sure, knock yourself out. I guess. So not everybody has the same problems to solve, which can introduce noise into this. But the fact that you have that feedback loop is still super, super valuable because I want to know both did the member of my team do a stinky job this month and is Tim not a great fit for me? Like I want to know both of those things. And so there may be like it may be worth if somebody leaves you a negative, doing a more granular breakout of like, how did Steve take care of you versus how do you feel like we're actually solving your meaningful problems? Like maybe there's a more granular version of that that is opted into once they give you a detractor level rating. But the biggest issue I see with MPS scores is in the actual implementation of how they go out. And so I think probably the most common thing that happens is one of two things. Probably the most common accounting practice application is maybe you get to the annual renewal, you send them a little survey, hey, how did we do? And you collect that number and it's, it's not mandatory at all. And you get like 10% of people to respond, right? Like if that like you get a very small number of people who will respond. And it's worth acknowledging that while there are weirdos who will go out of their way to ruin your day, most people are, are like conflict averse like me. And if you're an accountant, probably you. So if it's like opt in and it's not a thing that they have to do, you're probably just going to hear from either end of the spectrum. So the person that's super pod that something went sideways and the people who absolutely love you and that's better than no information. But it's in no way like a complete snapshot of how happy they are with how happy everybody is with your firm. And so in accounting practices this probably is something that like goes out once a year with the renewal or something like that. In tax practices, I think the normal thing to do here is after the tax return is complete, you may be asking for a review and an NPS score or the real big brain among you ask them for an NPS score and then if they give you a good score, then you ask them for the Google review, right? And I think there's a number of products that kind of manage this workflow for you. Hey, I Wanted to tell you, this episode is sponsored in part by the lovely folks at Copilot. Oh, you know what keeps me up at night? This is probably going to trigger some of y'. All. What if you move your whole firm to a practice management system. You train the whole team, you move all your organizational data there, you train all of your clients on how to work with you in the client portal, and then you don't like it or they stop developing it or something like that. You know how sticky these things are and what a mountain it will be. To retrain your whole staff, that's one thing. But to retrain all of your clients and say, hey, just kidding, we actually want you to come use this system over here now. Yes. Sorry about that. Let me tell you, you know, a solution to that is to separate your client experience from all the systems that you use to manage your firm. Right. Think about it. So, Copilot, one of the things they do really well is they are just laser focused on the client experience. They just want to be the client communication layer. And why I can appreciate that the value of that is it gives me the power to change all the paperclips and bubble gum and strings behind the scenes that are holding everything else together. So if there's a super cool new AI this or that that's going to do my work better for me, I can pull that in without having to change the client experience. Pretty darn good argument for the apps that are just that, client communications layer, right, Copilot? You've probably heard me talk about it before. A super flexible client portal layer where you can, like, customize what each of the clients see and even embed stuff from other apps into that portal experience. To learn more about Copilot, check out the link in the show Notes. Hey. This episode, it's sponsored in part by the fine folks at ClientHub. Thank you, ClientHub. Hey. Last week on Tales from the Hub, super smart accounting firm was super pumped about ClientHub's new vision for how AI gets pulled into the product. They're calling it your firm on GPT. And let me tell you, super smart accounting firm. They just joined the beta program for the new email functionality. In a word, they're blown away. Client Hub now connects to email. Platforms like Microsoft and Gmail will pull those emails into the system. They'll take long email threads and summarize them in one click and even take a reply and change the tone of that reply to make it just right before you hit send. Pretty cool. And that is Just the email integration feature. Client Hub is working on a bunch of cool AI stuff. You want to be part of that pilot program? Taste the rainbow. Get on board. Check out the link to Client Hub in the show notes. I've actually had a number of people ask me like what the best app is to use for MPS stuff and I don't know, there's so many of them, I don't know. What one you use makes a huge difference or at least not as much of a difference as how it is implemented. And you definitely don't have to overthink it. Like any form builder will handle this just fine. What's more important is, is how it's implemented. It's hard for me to get into like recommendations of specific bits of tech and it's why you virtually never see me like actually using a piece of tech and like logged into it on my YouTube channel and stuff like that is to do a tool justice requires like complete comprehension and understanding of everything that tool does. And the reality of doing that for a bunch of different tools, like that's just a massive, massive undertaking. So there's certain times where like that investment, like maybe it is worth it. But for me most of the time, like if I'm just publishing a YouTube video, that would be like an astronomical amount of work to like get a deep understanding of those tools. And then my fear would be like, oh, did I just not know this or not know that about tool A or tool B. But I would say don't overthink it. It's more about the implementation of how you actually build it into the workflow. And that is the big thing that I think most people miss is it absolutely has to be built in to your clients workflow. So if you have a set of requests that goes out every single month, if you're an accounting practice, or if you have a set of requests that go out as part of the process to prepare a tax return, the only way, I mean it's, I guess it's worthwhile if only some people do it. It's better than nothing. But far and away the most worthwhile version of this is the version of it that is mandatory. If I need 10 things from you to close your books every single month, this need to be thing 11, like I need to get that from you every single time. And the only way that this figure isn't ultimately skewed by the people that did it and the people that didn't do it is if everybody has to do it and it's just part of the process. I think that can be cumbersome if you're asking too much of them. But to just ask them to give a single rating, I don't think that's bad. The other value of. And this is a little easier in a, in an accounting practice than a tax practice. The other value of asking them for that every single month is equally important to the absolute number are trends in the number. So if we swapped out Tina for Tracy on, you know, this client account and things are trending up, awesome. If things are trending down, maybe we need to have a conversation. If you think about all the way that our teams are incentivized and what sort of things we need to be reviewing with them on a recurring cadence and even going as far as how compensation is set, you want to talk about a blind spot. How much do your clients enjoy working with this individual? Like, that ought to be a pretty big driver right now. As with literally every single metric, it is far from a complete metric. As we talked about earlier, there's going to be a lot of times where maybe people are detractors because of your firm strategy not being right or wrong, but simply not aligning with what their needs are. And that's a management issue. That's not an issue of the person on the account. That's your job to better align the problems that you solve with a more specific type of person. But that being said, if I've got 10 team members, like, how nice that person is to work with, how attentive they are, how courteous they are, that's probably the single biggest driver of what that MPS is going to be like. People just want to be listened to and feel like they have your attention. And buddy, it is not a super high bar in this space. In my opinion. Like, people just do not get phenomenal experiences at accounting firms for whatever reason. But in order for this to be a useful metric, it just has to be part of the process that the client is required to do. If you're on a tax practice, how do you get that thing on a recurring basis? At the very least, you get it every year. The problem there is, if you're doing it like during the tax intake process, what are they actually reviewing? Like last year, maybe it's a mandatory step when you are collecting 8879 or something. If you're in the US on the month end close, I think I would probably be asking them like the very first question, how did we do last month? And ask for a number. But until it's A mandatory part of the workflows that you set up for your clients. I don't think it's like a truly representative figure. And the ultimate value of this metric is for managing alignment with your staff. And if there's any noise in that metric that will make that inaccurate, like you totally take the steam out of that actually being a useful tool. So when it comes to alignment and how we manage our teams, in fact, somebody. Where was this? Maybe it's a YouTube comment. I was talking about how I my general disdain for dashboards and how I don't want one more thing to manage. And they shared how a dashboard is actually super helpful for their team to keep like their kind of collective project responsibilities on track. And I actually really like that. I think that was a good contribution. When it comes to the alignment of you and your teams, it's something we generally don't put numbers to enough. And a lot of our frustrations with our teams and people not using quote, unquote, common sense and executing to your expectations just come from different incentives and not being aligned on what priorities are. And that is like the highest and best use of an mps, I think is as a driver for alignment on just how much we're going to prioritize, like the client experience and how we care for our clients and how to identify the people that need help before it's too late. And we've all had those client relationships where like we thought everything was fine and they were a long term client and then all of a sudden they surprise you and they're going to go somewhere else and you're like, wow, I didn't see that one coming. And sometimes it's just a matter of no longer being the right fit. Other times it's a question of like, there was actually more going on there than you realized. And I would rather known that sooner than later. I have kicked myself before losing clients like that when I think a more proactive like meta conversation once a quarter with that client probably would have prevented it. And like we struggled with what are the right times to like discuss the state of the union? Like we do an annual renewal, but to be totally honest, like, I'm pretty stressed out of my mind when I'm doing annual renewals because they're all happening at the same time. It's toward the end of the year when we're super busy, slash I want to be on holiday. So one thing we struggled with was where and when do you make the space for like those meta conversations about the engagement and how it's going and what their needs are. Because if you're managing large engagements, it's certainly more than once a year. And it led to us losing some clients that I wish we didn't lose. But I think actually the MPS would have got out ahead of it if we were better about managing it. I can tell you what our biggest blocker for MPS was. I didn't want to add yet another MPS tool. And honestly, I. I think you probably shouldn't. What I didn't have and what kept us from leaning into this was I didn't have a super lockdown request system that I could incorporate this into. So I could plug in an MPS tool and blast that out to like 2,000 email addresses. But what's that really gonna tell me when 30 people respond like, do I really know anything more now than I did before? So, like, my struggle was I didn't have a rock solid way to like, make that a required thing that somebody has to provide to me, I mean, that's an advertisement for the value of cloud practice systems and why you need a solid request workflow. But if you think of all the different ways that we need to like, measure the success of our team members and how they're incentivized and all of the things that you want to be aligned on, like, we. I think we did an episode in the past around commission based compensation, and I am 1000% for like metric based compensation because I was always a high performer. And I think high performers are inherently penalized in a traditional hiring system. Like, growth is usually like fairly inelastic relative to how quickly a high performer can grow and output much more of their peers, pick up the slack for peers, which is like just the most frustrating thing, right? When you're operating at a level that's higher than your peers and you end up paying the price for that. And so the more we can tie comp back to what, like actual quantitative things that we're all aligned on, the better. So obviously I think production just has to be one of those things. Like there's gotta be in that total calculation, there has to be revenue as a factor. But for me, probably the two biggest factors are MPS and revenue. I've actually heard Brandon hall talk about this. I think they use MPS in their kind of employee feedback loop because it's pretty hard to BS an MPS number. You know, like, hopefully your clients are being honest there. But an NPS is one of those things that kind of covers a lot of things. This episode is sponsored in part by the Fine Folks at Cloud Accountant Staffing, do you hire accountants? Bless your little heart. Not the best part of the job in my opinion. Not something I ever enjoyed. Well, listen, you can build your accounting dream team with talented offshore accountants in the Philippines that work 100% full time for your firm. Their accountants aren't freelancing or contracting for multiple firms. They're all yours. They work exclusively for you and are incentivized to stay with you and your team long term. They're not gonna get swiped. Cloud account staffing is 100% dedicated to the accounting industry and founded by a former accounting firm owner that understands your business, knows your pain points. They had to hire some accountants and they said, you know what, we're gonna build our own pipeline in the Philippines, gonna pull in some super talented people and then open that up to other firms. Basically that's the story. I've been talking about a lot about staffing, building more resilient staffing pipelines for your firms. I had staff in the Philippines like totally red pilled me to like, oh geez, like we need to globalize the way that we get our work done. Check these folks out. Link in the show description cloudaccountantstaffing.com again, like there's always going to be noise in any metric. Like maybe they're bent out of shape because you increase their fees and that's not reflective of, you know, the account manager who maybe isn't involved in that at all. But ultimately the best yardstick for higher teams performing the ways that you ensure alignment on different things. Like surely MPS has to carry a pretty heavy weight there right now. Useful things you can do with this besides either raking your team members over the coals or giving them a promotion and a company car is being more mindful of or at least being more aware of who your champions are. Like, who are the people that absolutely love you. We've talked about just trying to get more comfortable with asking for referrals from your best clients. The type of people who fit the, the profile of what you want to do more of. I think the fact that we don't proactively ask for referrals, as long as we don't do that, I think our business will actually trend in the wrong direction because oftentimes we're doing kind of like low value or discounted work for certain types of people and those become the most likely people to then refer you to their friends and they come in the door with this fee expectation that is not at all what a new client coming in the door would normally come in at. But yet we feel this almost responsibility to people who we are referred, like we're supposed to be thankful for that referral, even though it's not a great fit for you. And to me, the only way to sort of turn this on its head is basically proactively go after referrals from the clients for whom you are a great fit who are super dazzled and paying you top dollar because you're solving really painful problems for them. Proactively going after those referrals while not necessarily taking referrals from the rest of your client base, saying, you know, we're actually at capacity. We're only taking like very select types of clients right now. That's totally okay. Like, that's totally a fine thing to say. And I honestly think if you don't say that, like, referrals can genuinely pull your business down. At worst, at best, they're a lateral move. They're more of the same. Like by definition. Right. Even if you just had a normal distribution of who's recommending your firm, it's a sidestep. It's more of the same, which for most of us isn't actually what we want. Every time you bring in a new client, I would love for that to be like, ahead what to the right in the better part of the normal distribution. Because I don't get excited about just doing more for the sake of doing more. I get excited about doing more better. So when you get those NPS scores back and maybe you've got a hundred clients and 20 of them, like, absolutely love you, it's worth doing the work of going down the list and saying, why do they absolutely love us? What are the painful problems that we're solving for them? Because oftentimes there's little nuggets in there that maybe you aren't aware of. That's how we stumbled into our. Some of our best pains to solve for was doing it unwittingly for a client and then absolutely loving us. Like, we did some different off the wall stuff. Like at one point we were managing like a payroll and benefits user and a slack. And any of the employees could message us with questions about like what was on their pay stub. And we had benefits integrated with gusto at that point. So they would ask us questions about that and we would point them to resources and that sort of thing. And at the time, this company had like basically one sort of operations person where all those questions went to. Took her an outrageous amount of time to answer those questions. Oftentimes she just passed those questions through to us and we would then answer it for them, like through her. And instead we said like, hey, what if we just have this user? We're going to charge you Honestly is a pretty hefty sum to handle all this stuff directly with the employees. But this ops person was super valuable and they needed more of her time. Well, when we offered to just like, hey, like, we'll charge you a little more, but do you want them to just come straight to us and we'll answer the questions, they were like, oh my gosh, yes. This saves us from having to answer. Hire another person who doesn't really know how to even address these questions right? Or what are you going to do? Hire an HR professional? Like, there were small businesses saying we're going to do that. So they were jacked. And when we realized that, we're like, okay, this is actually a pretty painful process problem for this type of business. You don't have anybody that really has this expertise and you normally have a person who's sort of the liaison to our firm. What if we could just like give direct access? Honestly, in many ways it's easier for us because we don't have to play telephone through this other person. And it completely removes this person who's usually in a very trusted role from having to do that job. And that person's time is super valuable. And this was honestly just kind of a throwaway for us. But when we did it and then had follow up conversations with the client, they were like, we are so in love with this. Thank you so much. And we ended up pushing that out to other clients and like, they were super pumped about it too. And if we hadn't been having a conversation with them, a more meta, like engagement conversation about like how tickled they were by that, we wouldn't have known. And we never leaned into MPS's as much as we should have because we just didn't have a good way to lock that down. But that's the sort of thing that you really want to find as soon as possible. Those super painful pain points that you can solve in a scalable way. Those are huge opportunities to build a more profitable firm. Like, nothing gets me more excited than those things where I'm like, oh man, I didn't realize this was so painful for them. I can totally add another person to the offshore team and we can do this for a bunch of people and they'll pay top dollar for it. So I think beyond just how well is my team serving this client. I think NPS scores can actually be super helpful for finding those people who absolutely love you and then being able to go deeper and say, like, why do they absolutely love us? Is it things that we just sort of, of, I don't know, didn't realize were super painful for them? Is it something different that we're doing for this person, not doing for other people? Like that. That reflection, I think, makes you more self aware about what you're doing for clients that they're excited about. And when you think about that like value chain of all the things that you deliver, oftentimes there's things in there that we sort of just give away that we don't realize the client assigns actually a ton of value to. We'd love to hear your experience on MPS scores. Have you figured out a good way to like build that into your workflow? I think a request best system within a practice management system seems to me like the best bet. And most of them have like little form builder types of things where you could absolutely build a 0 to 10 or 1 to 5 stars or whatever that looks like. You could just set that up as a request just like everything else that goes out to the client. But if you got any big brain wisdom on MPS scores specifically, please do share in the comments and I'll see you in the next one. Bye.