How to deal with awkward client conversations: A survival guide

Awkward client conversations are adding to the pressures on accounting and bookkeeping firms in the post COVID-19 world as they also face workplace trends such as ‘quiet quitting’ and ‘the great resignation’. We look at some of the issues confronting companies while psychologist Clare Mann offers advice on how firms can act to make life better for themselves and their clients.

Difficult conversations are a cornerstone of professional services, but research shows accountants and bookkeepers often avoid them.

The State of client engagement in the US report, by client engagement and commerce platform Ignition, conducted with research agency YouGov, found that unrecovered out of scope work (also called scope creep) costs accounting and bookkeeping companies an average of $76,636 in the United States every year.

The cost of putting off awkward conversations with clients, especially over out of scope work, unbilled hours and late payments may be deeper and more serious than many realize.

Ignition’s research shows that large numbers of accountants and bookkeepers said their mental health and that of their team’s has suffered as a result of avoiding or delaying awkward client conversations. And the knock-on effects of the COVID-19 pandemic are likely to be making such problems worse for companies.

Emma Crawford-Falekaono, Managing Director of EMEA at Ignition, says: “The last two and a half years, with the COVID pandemic, and now moving into an economic downturn, has put the stress of having to navigate dealing with pay overages on advisers. We’re all human and asking a business that is struggling financially already to pay more for the additional services that you have been providing is a difficult conversation to have.”

She adds: “It’s the first time many of us have experienced a global health emergency for a lengthy time period like that. It fatigued a lot of people in the profession.

However, continuing like this is not sustainable, Emma Crawford-Falekaono says. “The fact is you need to keep the lights on, keep your staff employed, pay them and support their families. Yet you also need to make sure your clients are still in business, because if they close down neither they nor you will be in a position to navigate through times of adversity.”

Guy Pearson, co-founder and CEO of Ignition, says that when awkward client situations arise, the fight or flight response kicks in, according to experts. He says scientific research into the consequences of avoiding awkward situations has found that, “Those who addressed the awkwardness were able to establish a ‘sense of social harmony’ and connection with others. Those who avoided it? They magnified and extended the negative impacts of the awkwardness.”

Impacts on staff from avoiding or delaying having awkward conversations with clients

The global trend of fewer people training to join the profession was already hitting firms even before the pandemic and the causes for this are not hard to find: surveys of accountants globally regularly report stress, lack of training, poor advancement opportunities and low job satisfaction are among the key alienating factors.

The urgent need for companies to address both the profession’s image and its workplace environment were highlighted in ManpowerGroup’s 2022 Global Talent Shortage Survey. The reports said that globally, banking and finance roles, which include certified accountants, are in the top seven hardest to fill positions, and are expected to be in second place in over 40 countries in the near future. These pressures add to the need for companies to address awkward client conversations sooner rather than later and not delay having them.

In an effort to better understand some of the pressures on firms, and how to better deal with awkward conversations and trends that may be related to them, such as ‘quiet quitting’ and ‘the great resignation’, we spoke to psychologist and communications trainer Clare Mann.

The costs of a stressful workplace and a poor work-life balance on mental health include burnout, disengagement, sick leave and staff turnover, Clare Mann says. Recent phenomena such as ‘quiet quitting’ and ‘the great resignation’ are also putting additional strain on practices that are finding new recruits harder to find.

While many accountants and bookkeepers told Ignition’s State of client engagement in the US report that avoiding or delaying awkward client conversations has contributed to the problems of poor work-life balance already facing the profession, such as high levels of stress and burnout, Clare Mann says avoidance of conflict is common to everyone.

She adds: “It's important companies recognise this human element in avoiding confrontation. We can make jobs streamlined with cloud computing platforms and technological systems to improve job performance, but ultimately it’s a relationship between adviser and client that will be based on performance.”

Learning to listen and give feedback on what you’ve heard is an important habit to develop that will ease stress points with clients and staff, Clare Mann says.

In the State of client engagement in the US, 34% of those surveyed cited lack of skills to negotiate with the client, and 33% said lack of confidence to confront the client as reasons for delaying awkward conversations.

“When you have a meeting, check back that what you’ve heard is what was actually meant,” she says. “You can’t negotiate till you challenge, clarify and confirm what was intended. So often this is not done. People come away from meetings with assumptions about what’s been suggested or judging other people, or feeling other people are judging them, and it causes all sorts of problems.”

Having clarity about what it is you’ve agreed to do will provide a firmer foundation for your future relationships than a beginning based on misunderstandings, she says.

The workplace was already evolving following more family friendly policies that began to be introduced around the world in the 1990s. This encouraged better work-life balance, particularly for women and parents. One of the aims of such policies was to ease the kinds of pressures and burdens that can lead to mental health problems and cause hiring and retention problems.

Clare Mann questions whether these policies are actually being delivered as intended across the accounting profession, while she says not having awkward client conversations may make them harder to implement because of the additional pressures this puts on teams.

“Lots of companies have work-life balance policies,” she says, “but the internal culture may not reflect them. Are staff really able to use them, or are they just for people the culture deems ‘flimsy’ simply because they use the policies? For example, is a new mom in a company with family friendly policies working 15 hours a day without complaint because that’s the unspoken ethos of the firm and using such services means they’re self-selecting not to be on the promotional ladder? If so, then that’s just paying lip-service to these reforms.”

Creating a healthy work-life balance promoting staff wellbeing is, she says, important for companies if they are to be productive and to retain and attract staff.

Francesca Deery, Global VP, People and Culture at Ignition, echoes this sentiment. “Recognise the pressures and expectations have changed… While the workplace has changed in a post-COVID world, where businesses have more readily embraced flexibility, the flipside is that work is no longer so boundaried.

“Therefore, work and non-work time has increasingly blurred with people working from home and having access to their emails and work messages well outside business hours. With this reality, businesses really need to empower employees to create and hold boundaries between work and non-work time, and have this role modeled unapologetically by business leaders,” she says.

Preparing for the peak times so there is less pressure in the rest of the year will help reduce the anxiety levels, she says. While there will be stressful and anxiety-inducing dates in the calendar when the adrenaline and fight or flight responses people experience are likely to be more noticeable, these should not be the norm.

“Society’s expectations have changed, especially after COVID,” Clare Mann says. “The long hours culture, of starting at 7am and finishing at 8pm, is a type of modal behavior, and it’s easy for people to slide into it a culture that dictates this.”

Many people aren't solely money driven when it comes to changing their job, says Clare Mann. It’s also about the culture. She says this includes having poor relationships with peers and bosses, which are major contributing factors for why people may leave in this scenario.

She says that improving your workplace environment is becoming increasingly important for practices to boost their efforts to retain staff and increase productivity.

She says having enough downtime is also important because many accountants and bookkeepers are living on fight or flight. Stress is a constant factor in many people's lives and burnout is on the rise.

“Things like encouraging people to take breaks, instead of working at desks all the time, which has plagued us for so many years and catches up with us, can make all the difference. We know performance suffers if you don’t take breaks but it has to be led by example from the top,” says Clare Mann.

Having at least seven hours’ sleep every night is also important. As studies show, staying awake for 17 hours is akin to having a Blood Alcohol Concentration (BAC) of 0.05%. Not enough sleep is mostly due to life-style, she says. “And also there’s evidence there is greater potential for conflict as the sleep deprived person is unable to correctly read the non-verbal communication of others,” she adds.

The physical space your staff inhabits is just as important as the mental. “I spoke to a client in the office and thought he was at home,” Clare Mann says. “He was on comfortable cushions, surrounded by plants, but it turns out it was a space in the office. He told me he used to think it was a bit naff but now he doesn’t. If he’s got to spend 10 hours a day in the office, he needs a space to regroup and let the creative juices flow.”

She adds: “You’ve also got to make time for training… You can’t put personal development on a portal and leave people to it, because they will put it off to the end of the year and do it just to get the ticks in the boxes. This is not because they’re lazy, it’s because they haven’t got the time.”

Clare Mann says the key to good mutually beneficial relationships with clients is regular clear communication. It can be tricky telling clients they need to pay more for services, so she recommends an approach sometimes known as the ‘good news-bad news-good news’ sandwich.

Going to a client and bluntly saying they need to give you more money may not go down too well. Instead, Clare Mann says, you give the client alternating layers of news. So begin, for instance, by saying something like it’s been great to see the project develop, that they’ve done a great job, however you’re now putting in more hours than agreed and need to charge more if this level of input is to continue while explaining they’ll still be getting the great level of service they’ve been having.

While technology cannot solve all problems, Clare Mann says it has the potential to lead to greater staff engagement and can help alleviate some of the stresses and strains of working life for accountants and bookkeepers.

Online collaboration platforms that allow people to escape from ‘email hell’ and contribute more collaboratively on projects are one way to create the sense of inclusivity. “People need to spend time on the business and not just in it,” she says, “so people need to sometimes stand back and recreate, to find better ways to do things.”

While collaborative platforms exist, Clare Mann says that looking beyond off-the-peg solutions can boost staff engagement. “Are there better ways to be creative? Because people commit to what they’ve created. So rather than saying, ‘hey, here’s your new interactive work system’, you can reduce stress and downtime by including people in creating this interface: include the PAs, the operations people, and get them to review and create the systems that will make it better for them.

“And if you can create better systems that will alleviate stress, then you will have more time to speak to your clients,” she says.

The State of client engagement in the US highlights many of the difficulties accounting and bookkeeping professionals face in having awkward conversations with clients and how these can have wide-ranging impacts on their staff, their clients and themselves.

While no one is saying that adopting more automated systems will completely rid you of the stresses in your daily lives, they can help you manage the pressure points and take some of the pain out of chasing up late payments or flagging up additional work that needs to be billed.

Daniel Gertrudes, CEO and Founder GrowthLab Financial

Emma Crawford-Falekaono says: “We want to automate more of the mundane or repetitive tasks, because business is all about the people and you can’t automate a trusted adviser relationship. You can put tools in place to make things easier or drive more clarity, but if there’s a change in scope it needs to be identified early on and you need to have that conversation quickly rather than thinking it’s something you can adjust later on.

But she says: “This is not about an automatic flag that sends someone a bill because they want more done. It’s about giving the adviser the tools so they can sit down with their client face-to-face and have the conversation about what the client actually needs and values before the conversation becomes difficult.”

And Joshua Lance says that forces beyond a firms’ control are making change inevitable and technology can help them adapt and build better workplace cultures for staff and clients. “Firms for too long have had the notion it’s normal to work 80 hours during tax season, but a lot of employees are now wanting a better experience. ‘The great resignation’ and ‘quiet quitting’ are signs of this, and the way the market is right now, staff can take their pick of whenever better opportunities come along.”

He says that technology will help with areas like capacity planning, which will ease the pressure on staff. “If companies use technology to do what it’s good at, handling the basic data and compliance issues, then the people can do what they’re good at, which is using the data to do a better job for the client. They’ll also be better able to see when things are going out of scope and negotiate with the client about that. When this happens, it means our clients' needs have shifted and changed and we need to shift and change alongside them.”

Carl Reader, Ignition’s Head of Accounting (EMEA) and Joint Chairman at d&t Chartered Accountants, says technology can help in three important areas. “The first area is by avoiding avoidable events. Systems flag events coming up, such as revenue dips in a quarter’s time, which helps you to know what’s coming, rather than your bank balance dips significantly more than expected.”

A second area, he says, is admin tasks such as creating letters of engagement and ensuring they’re in line with your regulatory needs and the client details are correct. “This eliminates one of the fears at the back of your mind. You can show it to your Institute and/or regulators at the touch of a button and show compliance.”

The third area is simply the knowledge everything will happen on time, such as by organizing client payments via direct debit mandates and ensuring client information is accurate.

The key to managing an out of scope request is having processes and solutions firmly in place, so you feel confident about renegotiating any additional work or pushing back on your client’s request, if you need to.

Which is why, to help address the issues of confidence and expectation setting, and to show how automation can assist with improving client relationships, Ignition has produced a free on-demand webinar for you to watch.

The good news for firms looking to improve client relationships is that there are tools and resources that can improve existing client relationships, and help future ones get off to a good start. For more information, watch the online demo.