How to have hard client conversations during a crisis

CPAs can employ a four-step approach in difficult circumstances.
By Samantha Mansfield and Tamera Loerzel

The economic shockwaves emanating from the COVID-19 pandemic have rocked the millions of American small businesses that constitute the core clientele of many accounting firms. Business owners now more than ever need advice they can trust to help make the often difficult decisions that will determine the ultimate fate of their enterprise.

As trusted advisers, accountants are ideally positioned to have these conversations. Doing so will require courage — both in broaching difficult topics (such as layoffs) and delving into the emotions (both the client’s and yours) this crisis has generated.

Your clients need guidance to move from a place of fear and uncertainty to one of hope and anticipation. The following four-step approach can help you initiate and navigate the sometimes tough conversations your clients need to have.

Step 1: State your commitment

Open the conversation by sincerely communicating your concern for your client’s physical, mental, and financial well-being. Empathy is a powerful tool to connect and earn trust. By being empathetic, you give your clients the space to share concerns they have been too afraid to admit to partners, staff, family, or friends.

If your client seems stuck in a hopeless state of mind, advise him or her to focus on the future. Futurist Daniel Burrus says, “Dwelling on current reality reinforces sameness. Dwelling on future goals reinforces action.” Help your clients share what they would like to see happen in the future, and leverage that knowledge to find agreement on the mutual purpose and desired outcome of the conversation. In other words, find out their goals so you can show the client how you can help.

Step 2: Explore the crux of the issue

Have the courage to ask tough or awkward questions even if you do not have set answers. Make the questions open-ended and then listen to the answers for cues (and clues) about where to take the conversation to reach the crux of the issue and begin developing a solution.

Discuss short-term strategies and also speculate about what the “new normal” will be when the economy opens back up — and what that may mean for their business. For example, you might ask:

  • How will decisions for the short term affect the client’s reopening of their business in the coming weeks or months?
  • What investments need to be made for the long term?
  • How viable will the pivoted business model be post-virus crisis? What is needed to accommodate changes in consumer and societal behavior?
  • What are your retirement plans and how do they factor into the decisions that need to be made?

You might need to ask a question multiple times (often in multiple ways) to get the full story. For example, it can be emotional to consider layoffs or furloughs, so the initial responses to a question about them may be that they are not options. As you prepare updated budgets and look at sales forecasts, you may need to revisit the question of whether furloughs or layoffs are needed. You may not get the complete answer initially because your client might need more time to mull over the implications or do further research.

Also, recognize that clients may begin to feel threatened by the feelings of vulnerability your questions create; emotions such as sadness, anger, or fear may begin to surface. If your client begins to withdraw by getting quieter, shutting down, negating the issue, or becoming aggressive to get you to back off, go back to the first step and remind them of your commitment to help them through this situation to maximize or protect their business and finances where possible.

Let them know that you are a safe zone, free of judgment, and you’ll face the ugly challenges — and upside opportunities — together. Doing so can help them come back to the place where they can share honestly and candidly with you, so that you can explore possible actions and steps toward a potential solution. Be prepared to take a break and reschedule if the client seems too upset to be productive.

Step 3: Analyze the data you’ve gathered

During this time of great uncertainty, it is extremely important to separate the facts from the stories that clients may be developing in their minds and subsequently telling you. Lean on your financial systems, data analytics, outside sources, and critical-thinking skills to get an unbiased view of the current state of the business — and its future projections. Know that you may not have the answers to all the challenges or opportunities clients present to you in that moment. Almost no one had a plan that anticipated a global pandemic.

Be transparent about your next steps and whether you need to give what you’ve learned more thought. Consider if you need additional information that the client cannot provide. If you do, explore outside sources to obtain that information. Options include consulting with colleagues, talking to other advisers your client has, or conducting further research to ensure you are developing a thorough set of recommendations. Taking these extra steps can help ensure that you have the information to propose a solution that the client can act upon.

Step 4: Deliver solutions to the client

Through the various questions, research, and conversations with your client, you will likely have a few options to explore. It can feel easier to come back with recommendations that do not reduce revenue, affect team members, or pause investments, but your job is to help each client confront reality and make sometimes difficult decisions. When you are faced with this, convey the same empathy and courage you demonstrated initially and:

  • Confirm the facts of what you heard from your client and the additional data you were able to uncover. Look to see if anything has changed.
  • Present your ideas and share how you came to those options or recommendations. Include expected impacts and outcomes you foresee with each option.
  • Discuss pros and cons of each option and any other considerations that can impact the client’s decision.
  • Be open to changing your approach as you listen and gain new information from your client.

Once your client chooses a path forward, develop a plan with specific action items to support their decision, including steps to get started, who should own or give input on the various steps, and contingency plans for when things change. Agree on how to follow up and help your client see the plan through, such as scheduling check-ins for built-in accountability. You’ll need to continually reevaluate your plan with business and societal conditions changing so rapidly. Be prepared to adjust the plan as often and as much as needed.

Your clients need your help to chart and navigate their course through the COVID-19 storm, and you are poised to do so by balancing your analytical thinking with care, compassion, and empathy. When you engage in these courageous conversations, you and your clients will make better decisions and be stronger when you emerge on the other side.

For more news and reporting on the coronavirus and how CPAs can handle challenges related to the pandemic, visit the JofA’s coronavirus resources page.

Samantha Mansfield is a Michigan-based consultant, public speaker, founder of Samantha Mansfield LLC, and a contract consultant with ConvergenceCoaching LLC. Tamera Loerzel is a partner of ConvergenceCoaching LLC, a leadership and management consulting and coaching firm. To comment on this article or to suggest an idea for another article, contact Jeff Drew, a JofA senior editor, at Jeff.Drew@aicpa-cima.com.

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