To become a successful rainmaker, you need to think about not who you know, but who knows you and who trusts you enough to send business your way. If it were simply a matter of who you knew, you’d find new referral sources simply by meeting new people. But it takes time to become sufficiently known so that the people in your universe, your clients, professional colleagues, business associates and friends develop enough trust and confidence in you to send their referrals.
Since you don’t have unlimited amounts of time to allot to client development efforts, and since all referral sources are not created equal, it’s important to have some criteria to determine in whom you should invest valuable time.
Create Two Tiers Of Referral Sources
There are at least two tiers of referral sources. The top tier, as distinguished by Dan Sullivan, creator of the Strategic Coach, is your ‘Top Twenty Percent.’ These are referral sources that consistently and frequently send you your highest quality business in terms of the types of issues and people you most enjoy working with. Expect to receive a steady stream of cases every year from this group. Maximize your client development efforts by spending the most time developing it.
The second tier is what Sullivan refers to as your farm team. Just as baseball teams keep an ever growing group of players in the wings hoping that with time and training a percentage of them will live up to their potential and be promoted to the big leagues, you want to nurture a farm team of secondary referral sources.
Your farm team, which is somewhat larger than your top twenty, includes other professionals you’ve known casually for the last couple of years, the financial planner with whom you play golf and the corporate counsel you sit next to at the bar association meetings. These candidates need to be developed so that they know you, like you and trust you. Expect to receive an occasional file from this group because your relationship is still evolving.
Identifying these two groups of people is critical to a firm’s growth. If you apply the Eighty/Twenty Rule to your referrals, you’ll find that 80% of your referrals probably come from the small number of people on your Top Twenty Percent list. It’s likely your firm owes its existence to a handful of people who know you, like you, and have faithfully sent you clients over the years. Since most firms don’t advertise in any significant way, the very survival of your firm is tied to the continuing good will of these people.
The best marketers regard their referral sources as friends and make a serious effort to sustain and deepen these relationships over time. Have you invested time and energy in getting to know your referral sources as human beings, over and above your business relationship? Have you befriended their staff? Do you know their spouses or families?
Rate Your Referral Sources
For an eye-opening experiment, analyze your referral sources using the ‘Top Twenty Percent’ approach. Using two sheets of paper, list the names of those you think are in your Top Twenty and your farm team. Next to their names, indicate the type of referral source: are they attorneys? CPAs? Former clients? In-laws? Then, assess the level of the relationship you have with each one by writing ‘high rapport’ or ‘low rapport’ next to his or her name. (You have high rapport with the person if you are very friendly, enjoy each other’s company and talk about more than business when you get together.) Next, indicate whether or not the person has “high potential” or “low potential” when it comes to sending you future business. Finally, estimate and list the amount of money that each person’s referrals amount to on a yearly basis. If you don’t know the exact amount, have your bookkeeper research these figures for you.
When the exercise is complete, you’ll have two lists that clearly illustrate your most valuable relationships. The people on your Top Twenty list with whom you have a high level of rapport and who send you your best business are the most valuable in terms of friendship, trust and referrals and they should be treated accordingly. Put them into a maintenance rotation, which means that you should contact them at a rate appropriate for the relationship, whether it’s two or three times a month or two or three times a quarter. Continue to build upon the rapport that already exists.
For those with whom you have a “low rapport” but who have great potential, cultivate them a little more aggressively based on their receptivity, availability and ability to generate work. Invest time and energy into developing your relationship with these people because as your rapport with them grows, so will their trust and interest in sending you work. Add them to the list of people you lunch with on a regular basis, or invite them out for dinner or to accompany you to community or charity events.
With 40,000 new attorneys graduating every year, competition for referrals is rising. If you haven’t thought about your referral sources as valuable assets, take a look at the two lists you just created. One good referral source can send you thousands of dollars worth of business every year, and hundreds of thousands over the life of your practice. Their referrals have probably kept you in business in the past and may make all the difference to your future.
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