Is loyalty hurting your business?

 

When I ran my own business I was proud of the fact that I cared about the people who worked for me. I gave them every chance, treated them fairly and looked after them.

I found out that one of them had been more than a little devious. He was a salesman, on the road all the time, visiting the office perhaps once a month. I had weekly reports on his activity and phone calls during the working day, and he was generating what appeared to be a sensible prospect list.

Somehow, the prospects never quite turned into sales. When I eventually let him go I discovered that he had actually been working for another business whilst claiming to work full time for me.

Looking back, I could see when this had all started. He had worked for me for about 18 months by the time I let him go – or more accurately I had paid him for 18 months. I think he was not focused on my business for perhaps 3 months.

I liked Derek and he was a really professional salesman. His initial results were so good I had him “buddy” one of the other sales guys for a few days.

I didn’t see the fall-off in performance until too late. I was suffering from misplaced loyalty – I thought he would come good again, but my delay and inaction cost us money.

Working with clients I often see the same problem. What is clear to me, as an outsider with no relationship to the individual, is clouded and obscured to the business leaders by their loyalty.

Sometimes it is not an individual in the business but a supplier you’ve worked with for years.

In every case you need to separate the emotional connection from the business need and do the right thing for the business.

If you don’t act, you are not doing good. You may be doing severe damage – perhaps even putting the business and all the others who rely on you at risk.

Weigh up all the facts and make the business decision.

 

Actions speak louder than words

 

In business it is important to remember that only a part of your message comes from your words, whether they are written or spoken.

You may have a company mission statement that refers to customer service and support, and create web content that talks about world class customer service.

Perhaps you have a statement that talks about continuous improvement, but do you actually have a system or process that supports the statement?

Internally, perhaps you have something in the induction program that refers to every team member being valued and part of the family?

In each and every case if you don’t follow through with actions to support those words they become worse than meaningless.

Your statements are promises.

You promise to provide a level of service and support, you imply that you value your customers and will “go the extra mile” to help them.

You promise to your customers (and your team) that you will improve the products or services.

You promise to make every new employee welcome and create a family atmosphere.

If your actions don’t support your words, you are breaking your promises. When you break a promise, you sow the seeds of mistrust. If you can say one thing but do another, why should I believe you next time?

If you say something – whether it is verbal, or on your website, or perhaps in a proposal – make sure you do it.

That means that sometimes you will have to say no, and disappoint the other party. No, Mr Customer, we cannot do it that quickly. No, Mr Customer, we don’t support that feature.

Say what you mean, and do what you say you will. Your customers and your team will respect and respond to it.

 

Bad Weather shouldn’t stop you

They say there’s no such thing as bad weather only inadequate clothing.

I walked the dog one morning in a howling gale and with heavy rain driven on the wind, but I was wrapped up warm with hat, boots and gloves.

In your business if you are properly prepared for whatever events are coming your way then coping with those events is easy.

What if events catch you unaware on the other hand?

That would be like going out in that howling gale in a t shirt, shorts and flip flops. Some people might enjoy it, but most of us would not (the dog wouldn’t care either way as long as she got her walk!)

What events might catch you out and what can you do to prepare for them?

Markets
If the market you serve – or the market your customers serve – is going through a down-turn, or seems likely to do so, does your business plan reflect that? It’s all very well taking last year’s numbers and adding a bit, but if in the meantime the market has taken a turn for the worse your plan is probably unrealistic.

If the market is picking up and there is more business out there, does your plan (and do your sales targets) reflect that or are the sales team getting an easy ride?

Forex

If you do business in multiple currencies, do you have a plan for exchange rate movements or are you just hoping for the best? At the very least you should be hedging your exposure but I’ve always preferred natural hedging, where your income and expenditure are matched by currency, whenever possible.

Customers and Suppliers

If your business is dependent upon any one customer or any one supplier, you should have a plan to secure your position, but also a plan to minimise your risks.

Throughout your business think of the external risks, seek to minimise them and develop a plan to cope should the worst happen.

Get the right people

 

Several of my clients are recruiting at the moment, and I’ve been helping frame their thinking as part of the process.

Sometimes, all you really need to do is to hire someone who can carry out the same duties as the person who has left, but actually that is fairly rare.

Think of recruitment as an opportunity for you and your business to learn.

Perhaps you can recruit someone from a larger company, who will bring with them years of learning and experience. There will be things that they are used to that don’t work for you and your business, but there may well be ways of working and procedures that they know and you can adopt or modify to improve your business.

A similar raft of knowledge can come from someone who has worked outside your industry. What they don’t know about your business is often made up for by the external view.

These are the people who are like an annoying toddler, they keep asking “Why?”

Why do you do that? Why this way? Why not the other way?

They will challenge your processes and procedures as part of their understanding, and they may just shed some light on things that have evolved but are no longer really fit for purpose.

The second part of successful recruitment is to think of the person you need for the future, not just for today. That’s especially true for businesses that are growing, but applies to all. The world is changing, business is changing and people need to adapt.

The final part of successful recruitment is the induction program. If you’ve chosen the right people and they have the knowledge and skills to challenge the established ways, will they have the opportunity to do so – will your culture permit it?

The first 100 minutes, the first hundred hours and the first 100 days are useful milestones to think about your induction program.

 

Do you make enough time?

 

Many of my clients are not very good at training and developing their staff, but to be fair that was also true throughout my career in the corporate world.

I remember being sent on a management training course after my promotion to lead a team, but that it was almost a year after I started in the new role that I went on the course. I’d made my mistakes and learned on the job!

I also remember it was a residential course in London, so we took advantage and the family had a couple of days touring the sites. My son must have been about 8 when he asked me what I had been doing that day and I was able to truthfully reply “playing with Lego”

Why wouldn’t you train your staff? There are no good answers, only excuses. Not enough time, it’s too expensive and so on. It’s not seen as a priority for the business so gets pushed to the bottom of the to-do list.

There’s an old joke about a conversation between the finance director and the managing director that goes:

FD “What happens if we train them and the leave?”
to which the MD relies “What happens if we don’t and they stay?”

It’s not just the time on the training course though. If you don’t put into practice what you have “learned” you haven’t really learned anything. You may have had an entertaining time (any trainer worth their salt will have made the sessions fun) but that’s all.

That’s a lot like the bookshelf in many offices, groaning with business tomes from the great and good, most of them unread. Take a look around your office – I know I have a few and I am sure you do to. My speaking colleague Nigel Risner calls the phenomenon “shelf development”

If you don’t take time after the training to put it into action, you wasted your time and money. If you don’t read and absorb the lessons from that book, you wasted your money.

 

People do business with people

 

I was at a funding event recently where one speaker talked about how investors decide to invest – or not to invest.

It has very little to do with the financial forecasts, or the potential return.

It has everything to do with the people. Investors will not invest in businesses if they don’t like the people involved.

Many years ago I worked with a venture capitalist who told me they would rather invest in a great team than a great product. The great team will fix the poor product and the poor team will break the good product.

When I am advising clients who are entering into corporate transactions – buying or selling businesses – I always stress the personal aspects. You won’t sell your business to someone you don’t like, or at least get along with. You certainly won’t buy a business unless you like the people involved.

When a customer buys from you they are making an investment. That’s partly financial – they exchange money for your goods and services – but more importantly it is an investment of trust. They trust you to provide goods / services that meet their needs.

That’s part of the reason why it is so much easier to sell to a past customer than it is to sell to a new prospect. The past customer, at some point, trusted you. With a prospect you have to establish that trust. With the past customer you have only to re-kindle the relationship.

Do you have a sales and marketing mix that helps create the trust that prospects need to move forward? Do you have the testimonials from people like them? Do you have relevant case studies?

Does your sales team focus on creating the relationship?

 

Management by expectations

I’ve always been a great believer in people. I don’t think many people set out to fail in their jobs, or set out to fail to complete a task or a project.

I do think there are a lot of managers who find it difficult to let go. They insist on telling their team what to do – sometimes in great detail – and quite often forget to tell the team why they are doing something.

The worst of these are the managers who forget to communicate altogether, so that the team carry on doing what they have always done. The fact that the boss wants them to do something else passes them by – the boss didn’t tell them, he expected the team to be telepathic!

You might be thinking “That would never happen here” but what if you go into a board meeting at the end of the day. You have a detailed and somewhat heated discussion in the board meeting and agree to do something different. You leave the meeting to find everyone has gone home for the day.

That night, your mind is buzzing, working out all the ramifications. The following morning, you have worked out a plan and you stride into the office & start issuing instructions.

The team weren’t in that meeting; they weren’t part of the debate. You’ve changed direction and they don’t know why or where we are all going!

An alternative management strategy is to manage by setting expectations. You focus on the outcome, not the tasks that might lead to the outcome. The team working for you have a series of goals. They know what you are expecting, and it is down to them to make it happen. You are empowering them to get on, use their brains and skill to get to the desired outcome.

If you couple this management style with supportive language and actions “Let me know what help you need to achieve this” you’ll really engage the team and get fantastic results.

 

What do you want to happen?

When you have a meeting, or you send an email, or perhaps you are having a telephone conversation it is helpful if there is a clearly defined purpose.

It is really easy to fall into the trap of re-running the same management meeting every week. Those meetings spend too much time looking at what happened last week and very little about what is going to happen / what will be different this week.

It’s easy to send an email that can best be summarised as “for information only – no action required.” You have spent time creating and crafting it, then the recipient has to take time to read it – and will probably respond, so that you know they have read it, and you have to read their response.

It is easy to pick up the phone and have a nice conversation with a prospect, but all too easy to finish the call without moving the prospect closer to becoming a client. Yes, you have to build a relationship, but that doesn’t mean that each and every conversation should not have a purpose above and beyond building the relationship.

With your regular meetings, make sure that you have a 30/70 split so that at least 70% of the meeting is spent focused on the things you can change, not the history you cannot change.

Before you send that email, think about what you want the recipient to do, what action you want them to take. If there is no action required, is the email necessary?

Find a reason to call, something that adds value to your prospect. They will welcome it and you build a stronger relationship. Have a plan for when your prospect falls of the prospect list or converts to a client. You can spend a lot of time talking to people who will never become clients or customers.

Act with purpose – you will get a whole lot more done!

 

Get clear on your strategy

Over the last few weeks I have helped a number of clients get some more clarity over their business model and their strategy for the future.

This is such a fundamental area for business success. Without that clarity, you cannot determine what your organisation should look like in 3 or 4 years, you cannot determine where to allocate your resources or even how to approach your market.

We are all told we have to have an elevator pitch, so that when you are in the lift with your ideal prospect you can tell them what you do in the time it takes to travel between one floor and the next.

There’s a fundamental flaw in that thinking. Your prospect does not care what you do. Your prospect cares about the result you deliver for their business.

It really doesn’t matter that you write wonderful software, or that you sell the best engineered widgets. What matters is how that software helps your customer or client, what gain they get from deploying it and what pain you are taking away. It doesn’t matter that you manufacture the best widgets, what matters is that you help your customer produce his product that relies upon those widgets.

Take your current marketing information, from the elevator pitch through all your brochures, leaflets, proposals and your website and highlight every time you see the words “We or I” and change them to you. (It’s known as weeing all over the page when you have too many we’s)

Now look at those statements that have a “you” replacing the “we”

See if you can respond to the statement with “so what?”

See if you could put that statement on your competitor’s website and it would still be true.

You may find you have some work to do so that your customer or prospect cannot answer “so what?” and that may take you right back to the fundamental reason why your business exists!

 

Sometimes we get it wrong

Sometimes we get it wrong and when we do there isn’t much choice we have to go and apologise.

It might be that you jumped a little too hastily at somebody when they gave you some bad news, but if you don’t apologise the following day or even earlier if you can you create a sense of resentment and a real problem for the future

They say it takes a big man (or a big woman) to apologise but actually I think you just need to be honest. Say “I made a mistake” and move on.

You’ll have the respect of the other person – they will respect your openness and will tell everybody else. Your reputation won’t be damaged by that momentary slip of your attention or that unwarranted reaction. Your reputation will be enhanced by the recognition from your team that you are big enough to say

“Sorry guys I got that one wrong”

If you don’t admit the mistake the team know that you made a mistake they know that you reacted hastily and your reputation is diminished. The level of trust the team will give you is reduced and if you’re not careful the team will stop sharing with you and you will lose out.

There’s no protection or face saving in hiding from the facts.There’s no point pretending to the customer that everything will be fine, when you know the delivery will be late or the project will over run. They won’t thank you for avoiding the issue and giving them a nasty surprise.

In the same vein, if something has gone wrong with your department or your area of responsibility, tell the boss – sooner rather than later.

Honesty really is the best policy