Recessions spark bullying behavior in the business world, so it’s important to dust off our childhood memories. Remember? If the smaller kids didn’t figure out how to stand up to the bigger kids, the taunting escalated.
A tight economy can invite your customers to assume that you have too little money and are desperate for their accounts. Long term customers can demand way too much. Have you established the “line in the sand” between what constitutes great customer service and your company being abused?
If your company has been distributing a line of products for the past several years, the manufacturer may presume that you can’t handle change or won’t take a risk when the economy is soft. Do you need to ask your Controller to generate a few scenarios and contingencies before you negotiate this year’s contract? If you don’t, the manufacturer could think they can demand even more restrictive terms. They may not have executed an acquisition and paid good money for your company, but the manufacturer will certainly own you.
We know that the financial world has been shaken over the past few years. Some community bank shareholders may be a little nervous these days and reluctant to make loans. Some loan committees are making unreasonable demands so it’s important for business owners to shop around and compare rates. You may need to politely remind bankers that their loan/deposit ratio matters and they need your business.
David Friedfeld, the President of Clear Vision Optical, recently shared his insights about “TAKING A STAND” when he was a guest on my weekly online peer-to-peer-to-peer talk show, The Growth Strategist™. Log on to www.business.voiceamerica.com or www.TheGrowthStrategist.com to download the interview first broadcast on June 22, 2010.
Do you believe the premise that customers don’t want to be asked a bunch of questions these days? If you believe that assumption, when a customer places an order for twice as much product as they usually do, your salesman should just process the order, enjoy the little bump in the commission on the order and say nothing.
What if the customer was preoccupied, distracted, or in a hurry and simply made an error when s/he placed the order? Your company will be delivering too much, which ties up inventory and wastes money and time. The customer may become annoyed or may even jump to the conclusion that your salesman was trying to get more money from them (“pull a fast one”).
What if the customer recently landed a big new account? When your salesman doesn’t observe a change or congratulate the customer, your company seems less informed about its customer accounts or disinterested in their businesses. AND if your salesman doesn’t inquire about the customer’s business, your company misses an opportunity to learn what other products that customer may soon need.
Believing this assumption also leads some companies to not even offer to provide the needs assessment step of their normal process. The customer must know what he/she wants, right? They called to buy a specific product. Let’s not waste their time or seem like we just want more of their money. Let’s just provide what they ask for, right? WRONG!
You could be underestimating your value to your customers. Skipping the needs assessment step is often a disservice to your customer and your company. Many customers need more help thinking through important decisions during slowed economies…not less. Your customer could just buy a product online if s/he didn’t value interaction with you.
It’s easy to say you are your customers’ “partner” during good times. If your working relationship is so weak that a slowed economy means you would be reluctant to ask questions, share stories, solve problems together, and find ways to attract business for one another… are you really your customers’ partner?
The absolutely horrible oil spill in the Gulf still hasn’t been capped. Federal and state deficits continue to deepen. The phrase “new normal” has replaced “recession” to describe the economy. It seems to be Europe’s turn to have violent demonstrations. Haiti is still reeling from its earthquake. Wars lumber on in Afghanistan and Iraq. North Korea and Iran flex their muscles. Unemployment levels remain high. Credit card companies raise interest rates and reduce lines. Every family feels the impact of cancer, diabetes, heart disease and/or strokes.
You don’t want me to continue this list, right? Why?
Many of us shut down (freeze) when we see or hear too much bad news. Other people become angry and focus on blame or retribution. It can feel like “road rage without cars.” Some folks become depressed, withdraw, and lose hope and creativity.
If you assume that this dynamic doesn’t affect you…why would you be immune?
The sense of helplessness spills over into most organizations. These days, it takes longer for even the brightest controllers to prepare financial reports and even longer for them to come up with meaningful recommendations. Board members of associations who are “in denial” refuse to reduce the number and scope of projects despite dramatically shrinking revenue. Teachers’ unions demonize governors who obviously must reduce commitments to lifetime pensions and benefits packages.
Instead of wishful thinking, take an honest look at yourself, your decision-making team, your employees, your vendors, etc. If you can’t see signs of anger, withdrawal, blame or depression, consider the possibility that you are more in denial than anyone!
Try openly discussing the impact of negative news and helpless feelings. It pays to be intentional and deliberate to help everyone around us move beyond anger and depression. If you do not have the requisite education or training to help your team, consider bringing in an industrial psychologist to help your team…and YOU. (I can refer you to good resources if you need them.)
If you are considering expansion of the board of directors of your privately held company beyond the CEO and a few owners, you already realize that a variety of factors are involved.
Reflect on the reasons you are considering an expanded board. Was the company facing a stubborn plateau? Are there chronic, recurring problems? Does executive leadership lack sufficient experience to take the company to the next level? Do the owners seek accelerated growth? Will the ownership change within the next few years? Are complicated succession issues involved? Is the company expanding or diversifying its products/services, target markets or geographic reach? Are you interested in trying dramatically different approaches like acquisitions, franchising, or venture capital? Who you need depends on what skills and insights you already have and where you are headed.
Pause before you just invite a retired industry executive (who may bring yesterday’s ideas) or your CPA (whose advice you can already access) to serve.
People who serve on boards and invest in continued learning are often active in the National Association of Corporate Directors. NACD provides research, conferences, courses, chapters, a database and a certification program. Some executive search firms (head hunters) can help identify qualified candidates. Make sure you ask how their database is developed.
It can also pay to observe the behavior of members of nonprofit boards. There is typically a core group of board members who are the “stewards” who do what is best for the greater organization. They have made a long-term commitment and aren’t self-absorbed or self-serving. They ask helpful questions while conveying respect for the executive leadership and staff. These core board members clearly understand how money works and take their fiduciary responsibility seriously. Even if they are known for a specific area of expertise, they can also take a holistic, balanced view of important decisions. Is that exactly what you need?