Referral dependence, defined
Referral dependenceis when an agency's new business comes mostly from people recommending it, with no system behind it. Tim Kilroy's observation is that agencies grow on delivery excellence and referrals, so positioning, offer design, sales process and outbound never become systems. When referrals slow, every gap surfaces in the same quarter.
The fix is not to stop taking referrals. Referred clients tend to stay longer. It is to add repeatable sources so a slow referral quarter is not a crisis.