Pursuing projects and not clients is a similarly destructive ethos. If a client is difficult to work with, cheap, or has unrealistic expectations or does not appreciate your work, they should not be pursued no matter how high profile or interesting the project is. This comes back to the fundamental tenet of serving and building the right relationships. If your business development is about chasing projects and not building relationships, you will always be competing for every project. If you build trusted relationships, you will compete less, differentiate yourself more easily, win more awards, and be more highly regarded overall because your clients will be your advocates in the marketplace.
“It is Okay to Take a Loss or Break-Even to Win Work” or “Pain Now, Profit Later”
This is poisonous thinking. During the Great Recession, many firms struggled to remain in business and retain staff, creating a hostile low-bid environment where the goal was to keep staff utilized. But this faulty logic has persisted well after the recession, with firms believing that to take on loss leader projects can “win work in new markets, with new clients, or gain projects for the portfolio.”
Here’s why that rationale is flawed:
On a systemic level, this leads to continued undercutting in bidding by many firms, and self-inflicted downward fee pressures in the marketplace that impact all firms at all scales. A brand cannot suddenly go from “high-value and differentiated” to “generic and low-cost” and back again in the client’s mind: when you compete on fee, you erode your brand and differentiation in a way that is difficult to come back from. Seldom do clients react well to having costs raised on them after the first or second project. A client who was taken on at a loss usually stays at or near a loss for all projects thereafter or is immediately lost when fees are raised.
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