How to Manage Client Expectations

Managing client expectations is one of the most common problems you’ll face in business, whether you’re an independent freelancer, a small business owner, or you work for a Fortune 500 company. Excellent customer service includes managing client expectations. When you know how to manage client expectations, you can operate more profitably and maintain your sanity. Not only that, but you’ll have more satisfied clients because they’ll have realistic expectations about the relationship with you.

Expectations with clients are most effectively managed when it’s done early in the relationship, for example during the client onboarding process.

Establish Clear Communication from the Onboarding Process

At the beginning of your client relationship, ask lots of open-ended questions to understand what the client wants, needs, and expects. Insist on clarity from the client from the very beginning of the relationship. If the client isn’t clear on what they want, you’ll never be able to satisfy them. Successful client relationships are based on clarity by both you and the client.

Set Goals, Limits, and Expectations

A lack of communication from you or the client creates space for misunderstanding. You’ll create stronger business relationships and improve client retention when you and your clients agree in advance on goals, limits, and expectations.

Set Clear Deliverables

What are the expected deliverables and the timing for each? Anticipate scope creep and be clear about how that affects billing. Also, be clear about what you need in order to meet deadlines.

Be Honest

Be upfront about costs, deliverables, operating practices, points of contact, and every other aspect of the relationship. Do your best to avoid surprises, especially unpleasant ones. While you’re preparing your proposal or contract, seek input from your leadership team and front-line people to minimize the possibility of overlooking an important point.

Establish Regular Communication

Once the relationship has been established, consider setting a weekly or monthly phone call to discuss what you’ve been doing on the client’s behalf. (Okay, I’ll admit that many clients won’t be able to get on calls like that. In those cases, send a simple, easy-to-scan email that summarizes the preceding period’s work.)

Be Clear About Boundaries with Clients

Know your own limits. How much time can you devote to each client? Understand the difference between explicit and implicit SLAs. Your explicit SLA is what’s written in the agreement between you and the client. The implicit SLA is what the client actually expects, based on past experience. An example of an implicit SLA is when a client has developed a one-on-one relationship with one of your engineers and bypasses your ticketing system to deal directly with that engineer. Since the client has always been able to go directly to that one engineer, they expect to continue doing so. Your explicit SLA might specify that clients use your ticketing system or go through a dispatcher. The implicit SLA, based on the client’s past experience, however, is that the client gets a dedicated engineer on-demand. Other boundary issues include when it’s okay to call and when to expect a call-back. Additionally, it helps to define what constitutes an emergency before one occurs.

What to Do When a Client has Unrealistic Expectations

It’s always best to head off unrealistic expectations before they surface. You’re responsible for ensuring that the client understands the relationship. Don’t make any assumptions about what the client expects. Spell everything out in a written agreement. Recap phone calls and meetings in an email immediately after the call or meeting. In the next paragraph, I’ll introduce a good-better-best pricing structure which includes a mechanism for dealing with unrealistic expectations and scope creep.

Establish a Good-Better-Best Pricing Structure

A three-tier pricing model is a great way to submit proposals to prospective clients. It’s also a great way to manage existing clients. You can label the tiers Silver, Gold, and Platinum or some other label that’s appropriate for your business, such as Megabit, Gigabit, and Terabit. You assign specific types and amounts of work to each tier. You also assign clients to a tier. When a client wants something that’s not part of their tier, you can offer to move them to a different tier or customize their existing tier for an additional fee. It’s the same when you have to address scope creep. It makes for an easier conversation and better understanding between you and your client. Author Mark Stiving’s book Win Keep Grow covers this concept in-depth as part of his discussion of subscription pricing models. It’s well worth a read, especially for MSPs, ISPs, and VARs.

Cheap, Fast, or Quality?

There’s a saying in the coding world that goes like this: Cheap, fast, or high-quality? Choose two. You can’t have all three. Clients, of course, want all three, but you simply can’t do it.

Stronger Business Relationships

You’ll build stronger business relationships when you follow these tips to manage client expectations: Establish clear communication, document conversations, insist on clarity, establish boundaries, and consider a three-tiered pricing structure. Managing client relationships can be challenging, but when you do it well you and the client both win!

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