Comments

  1. says

    Excellent article and advice. In my experience, the nice thing is that most times the top 20% clients need even less maintenance than the bottom 20% which weigh a small business or a startup down. So, may I add the concept and the complimentary thought of “firing your bad clients.” …and that, can be/is a constant process.

    What’s your thought on that Ian?

    Ky Ekinci
    Co-Founder
    Office Divvy ™

  2. says

    Hi,

    very good idea to challenge this well repeated Mantra – it is right up there with the 80% fail rate in first 5 years of business.

    My own experience is that 80% of turnover comes from the small percentage of clients that made the biggest purchases, however in my business it is absolutely crucial that these top 20% clients churn. Our custom software development service is designed to automate 80% of a major operational problem for the next 6 years – and we focus on your well mentioned medium-sized clients, therefore this is often the only thing we do for them. So if they have to buy the same amount of work the next year, something is wrong! In fact, for us its rather that the next client is the new top 10% client by default.

    This wasn’t always the case, 4 years ago it seemed that 80% of turnover comes from 50% of clients, but at that time I hadn’t figured out that the solution needs to be quite long lasting.

    HTH, Jochen

  3. says

    Thanks Jochen – that’s exactly what I found with transformation consulting. if your clients needs another business transformation next year you’ve done somethign wrong!

    Sometimes there were lots of little spin-off implementation projects. So the churn cycle was abotu 3 years. But there was healthy churn nonetheless.

    Ian

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