Client Analysis: The Fun & Money Matrix

by Terri Lonier

The week between Christmas and New Year's is always one of my favorite times of the year. Clients are often on vacation, the telephone rarely rings, and I get a chance to dig in, clean up files, and reflect on the year's achievements while planning the year ahead. A few years ago, while analyzing my company's revenues and the projects I had completed during the year, I created a simple four-quadrant analysis tool that lays out very clearly for me whether to continue working with a client, and where I should focus future business efforts.

I've shared this tool with solo entrepreneurs in my seminars and workshops, and it's always a treat to see their smiles and the shift in their expressions when they realize what a positive impact this analysis can have on their own companies. So I've decided to share this with the larger solo community by posting it here online.

While there are many filters you can use to analyze clients, this tool is based on just two factors: Money and Fun. It asks the question: Was it worthwhile to work with this client, both from a professional and financial viewpoint?

Here's how the tool works:
The graph has four quadrants, based on two axes. The horizontal axis is money, moving from low to high, left to right. The vertical axis is fun, from low to high.

Think back on the clients you have served over the past year (or whatever time frame you choose), and determine into which quadrant each client would fall.

Quadrant 1 (lower left): Low Fun, Low Money
This is the worst quadrant. The work was not rewarding, either professionally or financially. These clients are scratched from your list.

Quadrant 2 (lower right): High Money, Low Fun
This work did not stretch you professionally, but you were well compensated. In the ideal world, you would not need to consider this work, but bills have to be paid.

Quadrant 3 (upper left): High Fun, Low Money
These clients and projects were fun, they stretched your capabilities, but the budgets were slim and there was little or no profit to be made.

Quadrant 4 (upper right): High Fun, High Money
This is the ideal situation. The work was challenging and expanded your skill set. The clients were appreciative, and you were well compensated. This is where you want to focus future marketing efforts -- to either do more work with past clients in this quadrant, or to find other clients who fit this profile.

In working with hundreds of clients over the past two decades, I've discovered that ideal clients are those who are enjoyable to work with and who appreciate your work. They offer projects that stretch your capabilities and compensate you well. Not every client fits this profile, of course. But unless you take time to analyze your past work and clients, you won't know where to invest your time, energy and financial resources to chart the best path for your business growth.

My goal each year is to work with clients who can keep me above the horizontal "fun" threshold. I don't mind doing some projects with limited budgets if they offer something else in return, such as the chance to explore new intellectual arenas or meet new colleagues. Granted, when you're first starting your business, you may not have the luxury to turn down paying work. But as your company matures, you will discover that where you focus your thinking (and marketing) is often where you will end up. Let the Fun & Money Matrix guide you in gaining clarity on what types of clients you want to serve in your solo business.

Copyright 2006 Terri Lonier. All rights reserved.
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