When to Walk Away from Bad Consulting Clients

Consultants are engaged to help clients make better decisions. What happens when the client ignores the advice they are paying you for? Eventually, you reach a point where you must decide: Do you continue to collect a fee—for nothing? Or do you cut your losses and walk away? It’s one of the toughest calls to make as a consultant, especially if the client is a large part of your book. But hanging around waiting for the client to wise up can cost you much more than the monthly retainer.

I’ve had a lot of clients, and I have walked away from at least three. I let go of the last one because their research was flawed. The problem(s) lay with the company, and doing more research when they already had a lot of it wasn’t the answer. They needed to implement past research findings and streamline some major organizational changes. Unfortunately, this happens too much in our industry.

Consultants Aren’t Hired to Validate Bad Decisions

The line between consultant and vendor is clear. The vendor does. The consultant thinks. He or she evaluates the market, challenges thinking, spots risk, and recommends action based on experience, research, and data. That recommendation doesn’t always get followed. Often the client has information they aren’t sharing or internal constraints that we can’t know about. It gets sticky when it becomes a habit. You are asked for a recommendation. Analysis is given. It is ignored. Predictable consequences ensue. Meetings are held to discuss why the marketing program isn’t working. Pretty soon, you go from consulting to making decisions you believe are wrong.

The Warning Signs

Clients have already made up their minds about what they want to do BEFORE they ask for your opinion. They don’t want advice. They want confirmation. They ignore facts that challenge what management believes is true.

Research is only valuable when we as executives are willing to listen to what it tells us. Political agendas win over customer insight. When marketing starts marketing to itself instead of the customer, you know it’s time to jump ship. Every poor performance is excused as an execution problem. Execution isn’t always the problem.

Sometimes the creative isn’t the problem. Sometimes the media plan isn’t the problem. Sometimes it’s the agency. But the strategy was wrong. Your client is recycling the same mistakes. Once, failure can be a good thing. But failing repeatedly using the same strategy and calling it experimentation is insanity. They are making you defend your recommendation. This should be your biggest clue. Now your reputation is on the line for something you don’t believe in.

The Retainer Can Become a Trap

Consultants have financial motivations as well. A hefty monthly retainer can make it surprisingly easy to rationalize staying on. You tell yourself: Perhaps they’ll listen one day. Perhaps the new project will be different. Perhaps a new executive will arrive and shake things up.

Sure enough, sometimes it does work out that way. More often it does not. Soon enough, monthly revenue can begin to quietly morph into what essentially amounts to professional hazard pay. You’re being paid to watch decisions you don’t agree with get rolled out. The trouble is that consulting firms don’t sell widgets. They sell judgment and reputation. And reputation is a lot harder to rebuild than revenue.

Bad Clients Consume Disproportionate Resources

The other expense you won’t find on any income statement is time. A difficult client can soak up massive quantities of senior attention. Hours are lost in extra meetings, presentations, revisions, explanations, and internal discussions about what to do about the relationship.

All the while, your good clients – the ones who are willing to partner, try new things, and respond to data – may be getting starved for attention. That’s an opportunity cost. The question shouldn’t just be: “How much revenue will we lose if we terminate this client?” It should also be: “What new opportunities could we pursue with the time we’re devoting to keeping this client from making bad decisions?” Perhaps that means signing a better client. Or working on intellectual property. Or bolstering the firm’s brand. Or spending more time with clients who actually value your advice.

Disagreement Isn’t the Reason to Leave

Consultants beware. Just because a client disagrees with you does not make them wrong. Healthy consulting relationships are built on disagreement. Often heated disagreement. The best clients push consultants. The best consultants push clients. Walking away should never be about ego. Walking away is about whether you can do your job effectively.

There is a big difference between: “We considered your recommendation and decided to take another approach.” and “We’ve decided what we’re doing. Build us a presentation explaining why it’s the right strategy.” The first is management. The second is theater.

Before Walking Away, Put Your Concerns on the Table

Breaking up should not normally be option A. Have the awkward conversation. Describe what you see. Point out what decisions you think are harming performance. Provide the evidence. Describe what needs to change for the relationship to continue to create value. And most importantly, be clear about the business consequences. Not: “I don’t like this strategy.”

But: “Given the customer research, performance data, and competitive environment, I think this decision greatly increases the likelihood that we will fall short of our objective. Here is why.” Let management decide. That’s what they are getting paid for.

There Is a Line Consultants Shouldn’t Cross

Consultants are not paid to manage their clients’ businesses. Executives are entitled to ignore their advice. But consultants are also entitled—and in some cases obligated—to stop wanting their names tied to the decisions that are made. Eventually accepting the client’s money to continue on says: I’m okay with this. Walk away when it stops being about the money and starts becoming a statement about who you are as a professional.

Your Reputation Is an Asset

One of your most valuable consulting resources is the ability to say: “I don’t think you should do this.” Clients don’t hire smart consultants to get PowerPoint decks, marketing plans, or meetings. They hire you for your judgment. Guard that. Because if every recommendation you make eventually gets turned into something your client wanted to hear when you first walked in the door, you’re not a consultant. You’re an expensive echo chamber. And sometimes the best advice you can give is the advice they don’t want to hear. Sometimes the best decision you can make for your consulting business is realizing they will never hear it—and moving on.

I have zero regrets about the last client I let go. They were making bad decisions and asking too much, including having me set up a research portal for them.

One of the assets of consultants is that they usually come with a LOT of experience. Clients need to use this experience to their advantage, not dictate directions. Better to ask “what if” rather than “Let’s do this…”