You don’t have to be a parent to gain an insight into the relationship between children and adults. We all started as infants, grew into small children then eventually into young adults and finally reached “maturity”. So we can always view the situation from that perspective and still recognise the way in which it typically evolves.
So, just recall how it felt to grow, to develop curiosity then impatience and probably finally frustration that you had “outgrown” the need for parental control and guidance. You wanted to be independent. Not every life experience is the same of course, but please humour me while I explore the analogy in the context of business relationships.
If you are setting up in business it often starts with the chance to work with one client with whom you had a previous business connection, or with other small businesses that need your product or service. They may feel a natural affinity with you because you are both growing but are both still relatively small companies.
Over time, the relationship will be affected by both your fortunes and theirs. The balance and harmony between you can be disrupted. The client may represent a decreasing proportion of your total business and become less important, or they may grow to the point where you can no longer satisfy their requirements. Managing those relationships and recognising the changes that naturally occur are business management skills very similar to those required by parents.
What happens when the “baby” who you’ve helped to grow finally becomes a dominating figure and increasingly demanding? There may be a time in a business relationship when you must encourage the client to fly the nest as you can no longer support them financially. In other words, there is a mismatch between your economies of scale (or budgets and resources) and theirs. Equally, as a result of your research and development, your products or services may have a market value which the “legacy” client may no longer be able to afford. They need to find a more suitable home!
Without wishing to sound heartless, and whilst accepting that customer relationship management is vitally important, the fact is that supplier/client relationships do change over time. It is better to anticipate the changes and to be proactive in retaining control over your position, rather than having to react to an emergency when you suddenly see revenues drop!
In some cases, strategic opportunities arise from the growth of a major client. Their plans may involve you taking on more responsibility in order to support them and to reinforce the mutual dependence. That may include a decision by you to invest in new equipment, machinery or people. You may need to train employees with new skills or adopt different systems, processes and procedures. There is even the possibility that the client could make a take-over bid for your company. To pursue the analogy, I suppose that is a bit like your child offering to pay off your mortgage and provide for your retirement!
In conclusion, the need to stay tuned in to your client’s feelings and intentions is critical if you are to continue to enjoy their loyalty and affection. As you would with family members, you only want them to leave if or when it is in their interests. If that happens, you will at least be able to take some of the credit for their success!
We help clients to manage their business relationships by bringing people together at live events.