Climbing the pyramid of client relationships

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What role do you play with your clients? Yes, you’re their benefits advisor, but are you also their “trusted advisor?” That, after all, is the pinnacle of business relationships.

Think about your relationship with your clients. How would you define it? And more importantly, how would your clients define it? Let’s consider the possibilities:

The most basic client relationship is that of vendor. It defines where a product or service provider falls in the customer’s supply chain. A vendor responds to RFP’s, provides quotes, accepts service requests and take orders. Vendors frequently work to provide superior service and see that as their key differentiator.

Clients, however, expect great service from their vendors, and the vendor must offer it just to “get in the game,” while over time, the products and services the vendor provides become viewed as commodities. A vendor relationship is reactive and tactical; not strategic. As a vendor, you are not on the “inside” as different options are evaluated and the decisions get made. Having a solid vendor relationship with a client is nothing to sneer at, but is this the type of relationship to which an adviser should aspire?

Moving up the pyramid, a more desirable relationship to have with a client is that of a credible or authoritative source. Advisers who achieve this type of relationship have already proven themselves to be very reliable vendors whom the client can count on to be responsive. They are proven commodities, if you will, whom the client may involve in certain tactical decisions. They may be asked to assist in evaluating new products or service offerings and help determine which carriers or vendors receive the client’s business. An adviser is likely to receive referrals from this type of relationship, and many top-flight benefits advisors find themselves in this position.

Further up the client-relationship pyramid, an adviser may assume the role of problem solver or counselor. This represents a deeper and more permanent relationship with the client, and the adviser is likely to participate in some of the client’s strategic planning. Presumably, the adviser has pertinent knowledge about the client’s business issues and the current industry and human capital management challenges it faces. The adviser is pro-active in presenting the client with new strategies to support their business operations, has direct ties to multiple parties within the client’s organization and access to the “C” suite.

Given this close-knit relationship, the client is liable to call on the adviser to assist with drafting an RFP and vetting the respondents and their proposals. The adviser may also be brought in to assist with the negotiations, and the client generally views the adviser as a valuable business asset.

Life at the top
At the top of the client-relationship pyramid is the role of trusted advisor. When an adviser achieves this status, the client’s senior officers will take the adviser into their confidence, openly discussing their business issues as they seek the adviser’s counsel. They view the adviser as a business consultant whose input can save them precious time and money.

The adviser helps the client assess the state of its business and proactively offers solutions to potential problems—in some cases before the client even knows that the problem exists. This is a privileged position that often insulates the adviser from direct competition, since no-one else can match the adviser’s standing and inside knowledge of the client. For the adviser, these relationships tend to be enduring and highly profitable.

So what kind of client relationships do you want? What actions will you take to move up the relationship pyramid? Advisers really need to give this serious thought, since the type of client relationships they cultivate will shape the nature of their business.

Have you lost clients? Did you respond to RFPs but fail to win them? This may have had little or nothing to do with your technical knowledge about benefits or your insurance expertise, and more likely had a great deal to do with the type of relationships that you’ve cultivated and how your clients perceive the value that you offer.

To climb the relationship pyramid, first focus on understanding your client’s business issues, and the appropriate benefits solutions will logically follow. Work to make you interactions with the client as consultative as possible and concentrate your energies on becoming a trusted advisor.

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