As accounting and tax professionals, you’ve probably faced many awkward conversations or done your best to avoid them. Whether it’s human instinct, or a way to dodge conflict and not damage client relationships, it seems perfectly reasonable. But doing so has proven to not only affect many bottom lines, but also your mental health and well-being.
A recent Ignition survey confirmed this reality, with more than 500 accounting and financial professionals from the United States, Australia, and the United Kingdom weighing in on the impact felt from avoiding awkward client conversations. The results may be startling to some, but will certainly resonate with many of you.
Here’s a breakdown of those results, how they’ve impacted those in the accounting and financial world, and what solutions you can implement to survive and grow.
Shying away from awkward conversions—Why and how?
When it comes to professional services, awkward conversations are bound to come up, and it’s clear that you’re mostly doing your best to avoid them.
In fact, 89 percent of survey respondents said they have delayed or avoided having an awkward conversion with a client, with two-thirds saying they did so in an attempt to maintain or improve the client relationship. A third of respondents cited reasons for doing so as a lack of confidence to confront clients, not having the right information when it comes to the agreed scope of work, and not having the skills needed for client negotiations.
In addition, a whopping 94 percent of respondents said chasing clients for late payments was the most common client situation—something that happens almost once a week. And the next most common situation is 90 percent saying they didn’t bill the client for out-of-scope work.
The impact on accountant and tax professionals
While these common concerns and reasons may seem valid, they’re taking a toll on your bottom line.
Professionals who said they weren’t billing for out-of-scope work are costing themselves more than $6,300 dollars each month, or more than $76,000 each year. This financial hit is showing up all over the profession.
According to the survey, two in five professionals who avoided or delayed awkward conversations said it resulted in loss of potential income for their business, with 35 percent citing cash flow pressures as a common reason. Even more startling, one in five had to shut down their business because of profitability issues.
Beyond the financial toll felt by professionals, perhaps the most damaging result has been the burden placed of your health and well-being.
Due to these awkward conversations, 40 percent of respondents said they’ve seen a negative impact not just on their own mental health, but also that of their team members, causing staff overworking and low morale. What’s more, about a third of those surveyed said they have taken sick leave from work, and a troubling 30 percent have even resigned, due to a rise in workload and stress levels.
Steps and strategies for handling client conversations and growing your practice
If the survey results are any indication, avoiding or delaying awkward client conversations is costing your practice a lot of money, affecting team performance and retention, and placing a personal burden on some of your mental health and well-being.
To lessen these detrimental circumstances, your firm must be willing to embrace new ways of working and leverage technology to grow. Pursue automation and transform how you run your firm. Doing so can knock down the barrier of awkward client conversations and propel you to long-term growth.