A competitive world has two possibilities for you. You can lose. Or, if you want to win, you can change.
– Lester Therow, Management Professor
I recently had a client come to me and say: “You do great business. You are very responsive. But …”
The but was the client wanted a 20% discount on our professional rates. I was horrified because we hadn’t raised our consulting rates in 5 years. So, the client was asking for a reduction in professional fees. I hate these tough conversations.
What would you do? Walk. Tell them to stuff it. Accept the new conditions. This is one of those pivotal conversations you’ll have. What do you do? React. Respond. Or???
Well, my kneejerk reaction was: “stuff it.” Rational thought prevailed. I responded with: “OK.”
The reality was this particular part of our business had become commoditized. Lower client value. More competition. Lower billables were the result.
We changed our business model from low-volume and high margin to high volume and lower margin. That’s a reality for repetitive, low value added, and ultimately outsourceable work.
Life Lesson Earned: Respond. Don’t react to these requests. Think outside the situation. Frame your answer after proper deliberation about the business opportunity.