QuestionAnswered step-by-stepTopic 1: CLIENT’S WANTS What do Clients Want? The key to growing a…To

QuestionAnswered step-by-stepTopic 1: CLIENT’S WANTS What do Clients Want? The key to growing a…Topic 1: CLIENT’S WANTS What do Clients Want?The key to growing a successful firm has much to do with keeping a firm relevant to the changing needs of the clientele. Hence, understanding the challenges your clients are facing is important if you want to be seen as a business partner and provide tailored services which are valued by the client. Recent IFAC SMP Global Surveys have identified that when asked about the challenges facing their SME clients, 75% or more of respondents rated seven of the eight challenges as a moderate or greater challenge. Top challenges facing SME clients included economic uncertainty, rising costs, competition, and difficulties accessing finance.Table 6.5 What clients want   Result Quotation1. Accessibility “Be available for me, whenever, wherever.”2. Initiative “Come up with ideas that will help me and my business.”3. Timeliness “Be in the present, stay current with me, not focused on the past.”4. Comprehensible advice “Relate to me in ways I can understand.”5. Client choice and control “Give me options, let me choose.”6. Improved relationship “It’s more than just a transaction.”7. High level of expertise “Practitioner has specialist knowledge.”Q1. Explain briefly what is meant by “what do clients want” in topic 1. 1.1b Does Your Client Understand You?Key Performance Indicators (KPIs) are important for every business, and the practitioner is well placed to explain the financial indicators to their clients. KPIs based on the Profit and Loss Statement are usually of interest to the client. For example, a discussion of the break-even sales point or the safety margin will typically attract interest from the client. Another approach might be to translate ratio analysis for your client. Explaining a ratio brings it to life. Consider the current ratio: the calculation is “current assets/current liabilities.” Traditionally we would describe this in terms of “2:1,” or “two times.” This might be meaningful to the accountant but it doesn’t necessarily make sense to the client. Q2. Explain briefly what is meant by “does your client understand you” in topic 1. Client Relationship Management Key IndicatorsPeople    Staffing Number of full-time equivalents (FTEs) Number of employeesClient-facing staff Number of FTEs (with client- facing responsibilities)Percentage of total staffing Number of FTEs with client-facing responsibilities Client-facing staff as percentage of total staffWe want this to increase as we improve our client relationship cultureRevenue per FTE Firm’s billings divided by number of FTEs Indicates revenue per FTEFirm’s aim is to increase this over timeNetworking meetings attended Number of meetingsattended Indicates intention of team to proactively market the firmTo be tracked regularly and compared againsttargetMentoring hours Number of hours Indicates number of hours team members have been mentoredTo be tracked regularly and compared againsttargetProductivity    Work in progress $ Value Indicates how much time is recorded on timesheets yet to be billed to clientEmphasis should be on recording time which the client will appreciate in the completion of their work  Client Relationship Management Key IndicatorsWork in progress (WIP) Age (WIP Days) Indicates how long work has been in office and inprogressEmphasis should be on reducing WIP days, thereby improving turnaround times for clientAccounts Receivable Age (Debtor Days) Indicates how long clients take to pay their accounts A very good indicator of client satisfactionAlso a good indicator of our internal follow-up andcontrolWrite-offs Write-off ($ value) Indicates time charged, but not recoverableFirm takes decision not to invoice client, and writes it off WIPEmphasis to be on reducing write-offs. Time charged should be of value to the client, and therefore billableProfitability    Net income percentage Net income as percentage of total firm’s billings Indicates profitability of firmIndicator of capacity of firm to reinvest in people and client servicesLabor as percentage of revenue Labor costs as percentage of total firm’s billings Shows employment costs as percentage of billings Indicates if too many non-productive staffServices    Services utilized Number of services utilized (#) Indicates number of services utilized by clients Indicates depth of client relationshipEmphasis to be on increasing the range of servicesutilized  Number (per annum) of additional services taken up by existing clients Indicates additional services taken up throughoutyearEmphasis to be on increasing the services utilized by each client  Number (per annum) of new services introduced by firm during year Indicates new services introduced throughout yearEmphasis on continuing to introduce new services to clientsPositions firm as innovative and creativeFirm may deliver the service, or it may come from an alliance partner  Client Relationship Management Key Indicators  Revenue ($ per annum) from new services introduced by firm during year Indicates revenue value of new services introduced Important to separately identifySpecific costs can be allocated against revenue to determine gross profit contribution  Number of unsolicited client contacts made during week Indicates how spontaneous and proactive you are. You need to be!Increase this number  Number of hours spent on non-charged client-related initiatives Indicates time you invest in your clientsA number to track, not necessarily increaseCaution: don’t be excessive on this. You can’t do everything for free!  Number of proposals for new or additional services delivered during month Indicates success of marketing new or additional servicesEmphasis is to increase this until target levels of service utilization are reachedClient service    Client ratings Excellent (%) Satisfactory (%) Unsatisfactory (%) Measure client satisfaction with regular surveysProvides feedback on firm performance and client perceptionEmphasis should be on continual improvementDisputes Number of disputes Client disputes. Track the nature of the dispute and dollar impactGoal: no disputesExtra service activity Number of occurrences Track non-standard service and assistance provided to clientsOver and above normal service levelsEmphasis is on increasing this activity on ongoing basisClient referrals Number of referrals Number of new clients referred to the firmIndicates if existing clients happy with service levels and experienceClient seminars Number of seminars Indicates number of seminars heldTo be tracked regularly and compared against target in marketing planQ3. What are the CRM Key Indicators, give at least 5 and explain on your own words.  Four Types of Mass Customization There are four types of mass customization to note: Adaptive customization – standard but customizable products that customers alter themselves.Cosmetic customization – standard products presented differently to different customers (e.g. personalizing backpacks with customer’s name).Collaborative customization – a customized product that results from individual customer dialogues, identifying which product offering best meets their needs.Transparent customization – a customized product or service offered without the customer necessarily knowing about it (e.g. personalized treatment at a hotel based on observing and remembering preferences). Q4. What are the four types of mass customization to note? Briefly explain and differentiate with each other.Arts & HumanitiesCommunicationsMarketingCBA MM3210Share Question