Referrals are the life blood of any business, and a steady stream of prospects coming from referral partners should be the most plentiful and predictable means of obtaining high quality clients. After years of working with recruiters, small business owners, attorneys, and allied health care professionals, I’ve observed a pattern of inconsistency and unpredictability in the number of referrals they receive from these relationships annually. I’ve also noted that after implementing one simple practice—a periodic performance audit—there was a significant uptick in the reliability and total amount of referrals coming in. Something curious also happened as a byproduct of its implementation: the level of service (on everyone’s part) eventually improved as well. Let’s dive into the first aspect of this process.
It goes without saying, a multitude of factors come into play when someone decides to recommend you professionally: your fees, your flexibility, your availability, the caliber of your service, the depth of your professional knowledge, your personal integrity, and the quality of your relationship with the individual who is recommending your services.
Even if you score highly with respect to these aspects, the competitive nature of today’s marketplace makes it impossible to guarantee your position as the go-to referral partner for any given person or business.
You can, however, slant the odds in your favor, by increasing your contact with the professional with whom you’re attempting to build a solid referral relationship. You can drop by their office on a regular basis. Add them to your newsletter. Offer to shadow them (or to be mentored by them) so you can learn more about what they do and how they do it. Keep them in the loop by sending them client reports, documenting the progress of individuals who sought you out based on their recommendation. And of course, offer lunch-and-learns at their facility which they can, in turn, offer to their best clients as a form of a special bonus or gift.
These time-tested activities each have proven track records of driving up the total number of referrals obtained over the course of any given year. However, when I asked my clients to generate data on how long the referrals pour in, following interactions with their referral partners, an erratic pattern revealed itself. After each referral-generating contact, there was a noticeable uptick in activity, but invariably, the stream slowed down within 6-8 weeks, and sometimes dried up altogether.
After hearing the same report from my clients over and over again, I realized there was a step missing, and that’s when the idea of a performance audit came in. I’ll borrow a concept from the healthcare industry to give you the basics of how it works. Most individuals in healthcare do an initial screening to assess the condition of their new patients. A physical therapist, for example, might screen new patients for range of motion, postural alignment, grip strength, joint pain, numbness and tingling in extremities.
Such screenings serve to diagnose issues and to inform a course of action, but they also provide an invaluable baseline measuring stick for gauging and charting a patient’s progress, and will be referenced at regular intervals throughout their treatment. The same practice can be introduced to your referral process in the form of a performance audit—only with a twist: the initial purpose of the assessment is to audit your performance, not theirs.
Once you establish a formal referral partnership, you’ll want to schedule quarterly performance audit meetings with them throughout the year. (Here’s a link to a RefuseOrdinary article about the Referral Partner Cultivation Process.) Basically, it’s an opportunity to officially check in and have frank discussions about what’s working and not working, to improve the effectiveness of the communication between the two businesses, to brainstorm, to assess if the newsletters have been beneficial, and to review specific measurables.
The measurables are critical to the process. The numbers provide accountability as well as proof that you are actually doing those in-services, shadowing sessions, and client’s updates you agreed to provide. It also provides a means to adjust and reassess if they are effective, and how many should be slated in the future.
As an important side note, my clients often ask if they should measure and discuss the flow of referrals to and from each respective business. In some rare cases, this topic can be off-putting, wholly inappropriate, and unethical, particularly in the healthcare arena or when working with attorneys. It is, however, an important number you should track, to determine the effectiveness of the relationship. Bottom line, use discretion when broaching this, and any other topic, you wish to review and discuss.
When audit meetings focus on your process improvement, it’s only natural for your partner to want to improve their efforts as well. That’s the moment when the relationship moves to a deeper level. The quality of communication, the attention to detail, even the level of service provided to the clients referred all improve—predicated on the concerted effort each of you has to do right by the other. All together, this results in the number of referrals rolling through the door for each of you.
But how does this improve the consistency of the referrals? Conducting performance audits is an extremely nuanced process. Its success hinges on being genuinely interested in helping your partner grow their business by means of improving your interactions with them—and not the other way around. Once both parties have, in earnest, decided to mutually help one another, collective efforts become more strategic, coordinated, and streamlined, and have a greater impact in between each meeting. In doing so, it effectively pumps up the level and consistency of referrals over the course of the year.
Generally speaking, when it comes to making money, we’re usually looking out for ourselves—primarily. It might be counterintuitive to think about helping someone else grow their business by asking them to give you candid feedback on yours. Nonetheless, by approaching a referral partnership in this way, the referred clients will be the ultimate beneficiary of all the effort and subsequent improvements, yielding superior service from both you and your referral partner.
Not a bad way to make an honest living—for all concerned!
