Good customer service can offset poor fund performance to the extent that it could keep clients from defecting to other managers, Greenwich Associates reports. In a study of fixed-asset management firms, Greenwich found the client termination rate of managers with poor performance but above-average client service was 8%, 9% and 17% over the years studied, compared with 14%, 18% and 23% for poor performers with below-average customer service. The study shows that firms with below-average client service capabilities lost $150 million or more for every $1 billion in assets under management than managers with above-average customer service. Rodger Smith, a consultant with the research firm, notes that the study suggests that “asset managers with effective client service efforts are able to extend the grace period that clients give [poor performing managers] to turn things around.” He added that, according to the study’s findings, “After two years, firms with superior client service held on to more of their accounts, while managers lacking robust client service capabilities began to lose them – fast.” Interestingly, client service appears not to play a factor when asset managers produce above-average investment returns.