Re-Thinking "Cross-Selling": 4 Steps to Better Client Service & Increased Revenue

Sit in the boardroom of any professional services firm and you’re likely to hear the term “cross-sell”.

More times than not, you’ll probably hear it in a discussion related to how to do it better—because it’s likely not happening effectively.

In many firms, “cross-selling” is a much sought-after but often unrealized hope for firm leadership. Everyone wants to have it, but few do it effectively.

Of course, the idea behind "cross-selling" is simple: Generate more revenue by selling multiple services within the firm to a single client.

If a client is a tax client, cross-selling would mean they also purchase audit, or forensics, or ERP services.

There’s a reason so many firms struggle to do this successfully and I believe it can be corrected.

Today, I want to share why the common approaches to cross-selling don’t work, the foundational mindset shift that needs to happen, and how firms can take the idea of “cross-selling” from a hope to reality.

The Grim Reality for Most Firms

I didn’t come up with the phrase but I’m a believer in the saying, “Hope isn’t a strategy”.

Yet, if you look at the way many firms approach “cross-selling”, they’re essentially relying on hope.

• “Cross-sell” initiatives inside of firms typically include things like:

• Creating cross-sell mandates

• Adding cross-sell to balanced scorecards

• Running campaigns within the firm

• Hoping that cross-selling will ‘organically’ happen

• Assigning sales reps to canvas clients looking for opportunities

From my experience in the CEO chair of a Top 10 Accounting & CPA firm, these types of strategies don’t work.

New mandates are put in place or annual campaigns are run without moving the needle in a significant manner.

The average number of services per client typically remains very low.

It’s a shame because clients could benefit greatly from firms getting this right.

So what needs to change? Well, it starts with a simple, but critical mindset shift.

It’s Time to Eliminate the Term “Cross-Sell”

The core reason firms struggle to implement the idea of “cross-selling” is because of the term itself.

It’s an internally focused idea.

It describes what we, as a firm, are going to do and reflects how we, as a firm, are going to benefit. No wonder that approach doesn’t work!

Rather than looking at “cross-selling” as something we are going to do, we need to shift our focus to the service value we provide for clients.

What are they going to get? How will they benefit? How can we, as service providers, add additional value?

Isn’t every professional services organization’s goal to maximize their service value to their clients? It should be!

And if so, wouldn’t it make sense to deliver multiple integrated solutions to help clients in a variety of ways?

It does to me…

It’s called “professional services” for a reason. It’s about getting back to the foundation of serving our clients and helping them accomplish what’s important to them.

Will we, as a firm, benefit from providing integrated solutions to clients? Of course! Likely, the firm will generate more revenue. That’s a result, though, not a strategy.

Continuing to push internally to “cross-sell” isn’t going to deliver the results that firms are looking for.

It starts with shifting the focus away from our internal goals and focusing on the client.

Making Integrated Services a Reality

Whether you are a firm leader or an aspiring one, here are 4 things that you can do to create an environment where providing integrated services becomes a reality:

1) Ask the question, “What aren’t we providing?”

Some of the best professionals I’ve ever worked with were intentional about identifying what they weren’t doing for their clients.

They compared to other clients and thought about what else they could do to provide value.

Of course, it’s simple in theory, but I rarely find it executed at a high level.

It takes intentionality to slow down, pull yourself out of the work, and rotate your lens to see what additional opportunities exist to add value to your clients.

This is the basis of great service. It’s called professional services, remember?

2) Build integrated services into your strategy.

I’ve said it before and I’ll say it hundreds of times in the future…

All roads lead to/from strategy.

The best way to align people to delivering integrated services is to ensure it’s part of your firm strategy.

Define what’s expected.
Document it.
Distribute it.
Enforce it.

That way, if a partner or team member is against leveraging other internal departments to serve a client, they are off strategy. Plain and simple.

And being off strategy is unacceptable.

3) Be aware of the behavior you are incentivizing.

Many firms, especially smaller ones, are built on a sum-of-the-parts model.

Partners build their individual book of business and the firm revenue is produced as a result of the aggregate of those books.

I refer to that as a vertical organization.

While that may work for a time, if firms want to grow and enable scaling, they have to become horizontally integrated organizations.

Horizontal organizations are made up of their parts.

Each practice is treated as a business and all practices collaborate to provide more value to clients and more revenue for the firm. That’s the foundation of meaningful growth.

The #1 thing that gets in the way of creating a horizontal organization is the way people are rewarded.

Good luck creating a horizontal organization if your compensation structure and incentives are built to reward individual performers or practices.

As a leader, you might have to take a hard look in the mirror and be willing to re-write your incentives to reward new collaborative behavior. Structure dictates behavior.

Telling people to “cross-sell” isn’t going to cut it. People have to be rewarded accordingly.

4) Leverage technology to identify and act on opportunities.

While technology can’t do everything, it’s often much more effective than humans at analyzing large amounts of data and identifying trends.

So use it to your advantage.

I recently became an investor and strategic advisor for Propense.ai, a technology company using AI to analyze a book of business and identify opportunities to provide integrated services to clients.

Remember how we talked about the power of identifying what services you aren’t providing a client? Well, you can use technology to do that for you.

Now you’re building an engine to ensure identifying and delivering integrated solutions is part of your process.

You are no longer relying on hope as a strategy.

The Bottom Line

The traditional view of “cross-selling” simply isn’t going to work in the future. In fact, I’d argue it hasn’t worked for a while.

That’s why so many firms are left scratching their heads on how to implement “cross-selling” programs that actually work.

It’s time we change our vocabulary and approach from “cross-selling” to delivering integrated services.

As a professional services organization, you will benefit greatest if, and only if, you are focused on providing additional services to your clients that align with their goals.

The firm of the future will get this right and likely never get stuck on how to enforce “cross-selling” again.

With intention,
Alan D Whitman