Rain Making Problem #16: When You Can’t Give Back

(This post in another in our series of Rainmaking Problems. We invite your comments on this problem and would also welcome any problems you would like to s to get comments form other readers.)

An attorney, whom I will call Larry Polonisen, has sent in the following problem, one common enough in networking and well worth reflecting on.  How can he continue to take, if he has nothing to lend?  What would you do?

Hello, I am a faithful reader of your blog.

I have a suggestion for a post there (which I need to frankly admit is also a request for free advice).  The question is what to do when a contact gives you a couple of good referrals of business, and makes known (appropriately) that he expects referrals in return, but such reciprocal referrals are unlikely to ever happen (for lots of reasons not the least of which is that other better sources are in line for reciprocals before this person).  

The choices seem to be 1) tell the referral source that reciprocals are very unlikely, 2) actively search for things to refer, 3) assure the person (honestly) that if something comes along that can be referred to him it will be.  The first choice seems good in the abstract but horrible in the real world as it likely cuts off a referral source.  The second is again great, except that there is a higher priority for any referrals in this area and also because I get hardly any of matters in the referrers area (or I would be in that area myself).  The third seems the best, but if nothing gets referred, the referring lawyer ends up feeling taken advantage of.

I suppose that there might be a fourth choice (at least in my jurisdiction) is to offer the referrer a (legal) referral fee (perhaps coupled with the explanation under alternative 1).  What do you think?

Thanks very much.  I enjoy and use the information on you blog.

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15 Responses to “Rain Making Problem #16: When You Can’t Give Back”

  1. David Rockett Says:

    ‘Larry’ points to a problem I’ve had with formal Networking clubs (BNI…) — I simply would not refer someone I like to some of the members! I don’t trust them and would not/do not do business with them. So how do I refer to them, even if I know they like me and my work and will/do refer to me? A similar situation arises with multiple CPA and atorney referral sources. I would not use them all for various reasons, but DO get referrals from them. Thus far I’ve settle for a hand written/stamped/addressed thankyou notes — and perhaps coffee, lunch, or a small gift card… Better ideas????

    David

  2. Ford Harding Says:

    David

    When someone gives us a referral in expectation that we will return the favor and we have no intention of doing so it is:

    1) Awkward to tell them
    2) Disingenuous to continue to accept the referrals.

    That’s Larry’s problem. I have given referrals to people who buy me dinner in return. Without meaning to sound ungrateful, I travel and so eat out a lot. A nice dinner is not why I gave the referral. I gave it to help the client, first and foremost, and second to establish a referring relationship with the service provider. If he or she can only give a dinner in return, I think it totally sufficient. If the person could make a referral but won’t and doesn’t want to tell about it, I feel a bit used. So, what is one to do? That is the question in this post.

    Thanks for reinforcing it. What do others suggest?

    Ford Harding

  3. Judy Rosemarin Says:

    It has been my experience that outstanding networking is based on mutally beneficial relationships. Referrals, if they are truly based on a satsifying relationship, are not “strings” that guarentee an immediate quid pro quo.

    I have hosted senior networking groups for over 16 years, in New York City, and never once is there an expectation that every one, every time needs to offer up a referral.

    Networking is more than just referrals, folks. It’s about gathering information; marketablity, feasablity, learning about trends, uncovering needs, discovering the needs and nightmares of others.

    Become a ferret for the people who are fretting and you will see how useful networking can be. Net net, authenticity counts.

  4. Steve Shu Says:

    I have used the last option outlined by Larry:

    “I suppose that there might be a fourth choice (at least in my jurisdiction) is to offer the referrer a (legal) referral fee (perhaps coupled with the explanation under alternative 1).”

    With respect to describing alternative #1, however, I usually play this one a bit soft if I can. As opposed to shutting the spigot off immediately, I try to explore the space in terms of describing what kind of business I do in depth, understanding the business collegue’s services better, etc. with the end goal of seeing whether there really is no opportunity for me to reverse refer in the business colleague or provide something else of value. Ideally, I want to make the person that has referred me into an engagement also happy. At least for the folks I’ve dealt with, they seem to be ok with having open discussions.

  5. Ford Harding Says:

    David

    Rereading my earlier response to your comment, I felt that I should add that I have been on both sides of this one. My previous comment was meant to show the lead giver’s point of view, because it hadn’t been described. As the receiver, it poses a tough problem.

    Steve

    Your phrase “or something else of value” may contain something more of value to this conversation. Care to elaborate?

    Ford Harding

  6. Ford Harding Says:

    Judy:

    I agree completely, but if someone is hoping for leads–with no quid pro quo or expectation of immediate referral–and you believe you can’t or you won’t refer them business ever, what should you do?

    1) Go on accepting, without explanation
    2) Explain and hope for the best
    3) Something else

    Ford Harding

  7. Ian Brodie Says:

    I’m a little intrigued that the referrer made it so clear that he expected something in return. I may be misreading the way you described this – but that sounds quite forward and transactional to me.

    If the other guy is “on the ball” he should realise that you will already have established referral relationships with other similar service providers to him. His strategy should be to figure out how to dislodge your other referral partners (who, I assume are also referring to you) or get in as an additional partner – rather than just assuming you will be able to immediately reciprocate. If he simply refers more to you, that could lead to replacement of one of your existing partners. Or perhaps he can offer services in a niche that others can’t – that would lead to referrals for that niche initially – and then perhaps more over time.

    It’s also worth bearing in mind that while you might not be able to refer the same volume back to him; that may still be OK in his eyes – he may get “more” from each referral if they result in large pieces of work or longstanding relationships. I find, for example, that accountants are often able to refer more volume-wise to lawyers – but that a referral to an accountant often gives them them a client for life rather than a one-off transaction.

    I know it feels uncomfortable, but I’ve found that if you gird your loins you can begin to have a straight discussion with the referrer about what you can feasibly do for them. You can clarify your current position and have a creative discussion about what might work for them and how you could have a productive relationship. You might find there are things you could do for them, or different types of referral (for exampel to other introducers) that may be just as valuable. You can’t figure this out on your own – you need to talk to them.

    Ian

  8. Ford Harding Says:

    Ian:

    These are all good points. Imbalance in the ability to help between two network contacts is a complex subject, as you suggest. I suspect that someone senior to Larry in the firm is directing where referrals go. Larry is trying to build his practice, but doesn’t control referrals to the kind of firm that is giving him leads.

    I endorse the kind of frank discussion you mention. Sometimes it takes three or four meetings with a person to figure out how you can help them. The demonstration of a sense of urgency and obligation to give back in some form the help a person receives is one of the things you look for in a network contact. If they don’t have that sense at some level, they usually don’t make good contacts. We must show it to those who help us. I can be infinitely patient with someone who tries to keep the help-giving mutual. It’s when they show no sign of trying that I begin to look elsewhere. Your response reeks of sincere effort. That’s one of the things that makes you a good networker.

    Ford Harding

  9. Ken Lizotte Says:

    I agree with those who feel referrals should not be quid pro quo. That only strains the relationship and the referral itself. I have people I constantly refer to yet who NEVER refer back to me, yet I keep referring them. I also get referrals from folks who constantly refer others to me. You just have to go with what’s natural and have the attitude that karma will take care of everybody. Once you try to break the karma chain and FORCE things, the system breaks down. Take the referrals and don’t worry about it.

  10. Ford Harding Says:

    Ken

    Thank you for this comment and its clear statement of your approach to networking. I too have people I give referrals to and get none in return and I don’t believe you can force things. Still, my approach differs from yours-I do look for some sign that the other person recognize that I, too, need some help in making my way through the world. I would feel uncomfortable taking the leads if I felt I was less than clear about my limited ability to give leads back. That doesn’t make me right or you wrong, and I appreciate your putting your approach in a comment.

    Ford Harding

  11. Mark Buckshon Says:

    There are other elements to this issue besides the perception of respect and the need to fairly acknowledge your situation. It is the unstated but obviously important element: How well do you serve the referred client, and how much feedback do you and your referred clients provide to your referral source?
    I think nothing makes a referring individual feel better than hearing from the prson he or she referred the “wow” report — how great the new service provider is. This essential fact (besides enhancing good will with the referring person) also provides him/her with real value — because now he is likely to be even more trusted and respected by everyone involved.
    Quid pro quo is part of the story (and a valuable one, of course), but feedback and your own great work often provide the referring person enough value that direct reciprocation isn’t that essential to the story.

  12. Ford Harding Says:

    Mark:

    The client’s best interests must always come first and, as you say, when well served as demonstrated by the praise given by former clients are the most important motivation when choosing whom to refer. In many cases that is all one needs to get. It is not, of course, the only reason people network. There is one thing that makes me feel better than a wow report from a client about someone I referred. That’s getting a referral from that person, too. The best networkers, in my experience, are biased towards helping people and give a lot without any expectation of return. But they are also savvy about their giving to increase the chances of a return. Yes, there is a calculated element to this, but it isn’t mercenary, devious or totally self serving. It’s business, even enlightened business.

    Good to hear from you.

    Ford Harding

  13. Steve Shu Says:

    Ford,

    Regarding my reference to “something else of value”, I dunno. Have to get creative here. I have in the past sponsored tables at private economic forecast luncheons for my clients. I set it up such that the referrer would have an opportunity to meet some of my other clients in the same context with the clients that the referrer brought me into. Thus, while I’m not necessarily giving the referrer a direct referral, I’m giving him an opportunity to develop rapport with some people that spend consulting money with me and make his own case.

  14. Ford Harding Says:

    Steve:

    That’s a helpful example. Thanks.

    Ford Harding

  15. Ford Harding Says:

    Larry sent this note to all who commented:

    Ford,

    Thank you for posting my prior email for discussion. I truly appreciate all of the helpful comments and suggestions that you and each of the commentators provided. They were very helpful and I anticipate making good use of them.

    Once again, thanks to you and each of the commentators.

    “Larry”

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