Management

I hesitate to open this post with words like “in this tough economic climate” or “in times like these,” because what I’m going to share with you today are things that every small business owner can use regardless of the business climate and external circumstances.

In fact, if you implement these three things in your business, the current economic situation and other external factors become a non-issue in your success.

The first of these three things is Clarity. You must have complete clarity about your business goals, you must be perfectly clear about your ideal target market and you must be completely clear about how your product or service can benefit your client.

This clarity is not only for your sake, but for the sake of every prospect looking at your website or reading your ad in the local paper. When you are clear about what you do and who you serve, the prospects can easily determine if they are a match for you. read more

To care for anyone else enough to make their problems one’s own, is ever the beginning of one’s real ethical development. Felix Adler

One day last week I was sitting in a small conference room is Moscow waiting to give a speech. In walks this guy with an unnatural shade of blonde hair and big smile. I said to myself, “Self, this really looks like Richard Branson.” My self said back, “It is Richard Branson.” So we got to talking because you never know when you need help retrieving lost baggage or upgrading from coach! He asked me if I’ve ever flown on Virgin. Me being the Global Services United Airlines customer that I am, I told him that I never have, but “If the Richard Branson is asking me, I guess I will have to.”

At that point, he got on his knee and starting polishing my shoes with his jacket. Ironically, on my United flight over to Russia, the lights didn’t work properly so the whole cabin was either lit or unlit, but people couldn’t make a seat-by-seat decision. For this inconvenience, if I filled out a form (which I think I lost), United was going to give me 10,000 Mileage Plus miles or a $150 credit on a future flight.

This got me thinking about customer service, so I’m providing you with a chapter of my book, Reality Check, that explains the Art of Customer Service.

1. Start at the top. The CEO’s attitude toward customer service determines the quality of service that a company delivers. If the CEO thinks that customers are a pain in the ass, her company will provide lousy service. If the CEO thinks customers are treasured assets, it will provide great service. If you’re not the CEO, either change her mind, quit, or learn to live with mediocrity—in that order.

   I’m pretty sure you can check this box off at Virgin.

2. Put the customer in control. The best customer service happens when management enables employees to put the customer in control. Th is requires two leaps of faith: first, trusting customers to not take advantage of the situation; second, trusting employees to make sound decisions. If you can make these leaps, then the quality of your customer service will zoom; if not … well, there is nothing more frustrating than working for a firm that cops the attitude that something is “against company policy.”
3. Take responsibility for your shortcomings. Companies that take responsibility for their shortcomings garner good customer-service reputations because they have acknowledged that the problem is their fault and their responsibility to fix. Most people understand that “shiitake happens,” but it’s aggravating when companies deny that the problem is their fault and responsibility. Th at’s when you hear people say, “It’s the principle.”
4. Don’t point the finger. This is the flip side of taking responsibility. For example, when a computer program doesn’t work, vendors resort to finger pointing: “It’s Apple’s system software.” “It’s Microsoft’s application.” “It’s Adobe’s PDF format.” A great customer-service company doesn’t point the finger; it figures out what the solution is, regardless of whose fault the problem is, and makes the customer happy. As my mother used to say, quoting Eldrige Cleaver, “You’re either part of the solution or you’re part of the problem.” (By the way, as a rule of thumb, the company with the largest market capitalization is the one at fault.)
5. Don’t finger the pointer. Great customer service companies don’t shoot the messenger. It could be a customer, an employee, a vendor, or a consultant who’s doing the pointing. The goal is not to silence the messenger, but to fix the problem so that the messenger never has to bring that message again.
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Unfortunately, talent is not enough. Success in the workplace (and in any industry) comes down to successfully communicating your strengths. Forget PR and word-of-mouth, your career (and the success of your “product”) is 100% your responsibility.

There was a fascinating experiment conducted by a team of journalists at the Washington Post. The team set off to find out “Can one of the nation’s great musicians cut through the fog of a D.C. rush hour?” They took Joshua Bell – arguably the most famous living violinist in the world – and placed him in street clothes and a baseball cap within a DC Metro station during the morning commute [see the YouTube video of the Joshua Bell Experiment here] . Bell was also given one of the most expensive violins in the world – one worth millions and normally kept in a museum. He was asked to play some of the finest classical pieces ever written.

And so, as thousands of DC residents passed through the hallowed halls of the L’enfant Plaza Station on their way to work, Joshua Bell played his heart out.

Of course, this story ends with a startling (but not surprising) realization: Over the 43 minutes that he played, only a few people stopped to listen – and most of those who were asked about the music after passing through the hall failed to even notice. Alas, creative talent of the most extraordinary kind will go unnoticed if not communicated properly. Had Joshua Bell been placed next to a sign proclaiming “World Famous Joshua Bell, After Playing for The President Last Night, Plays For You This Morning on a Multi-Million Dollar Violin,” maybe people would have stopped?

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Which are you? Are you sure?

A freelancer is someone who gets paid for her work. She charges by the hour or perhaps by the project. Freelancers write, design, consult, advise, do taxes and hang wallpaper. Freelancing is the single easiest way to start a new business.

Entrepreneurs use money (preferably someone else’s money) to build a business bigger than themselves. Entrepreneurs make money when they sleep. Entrepreneurs focus on growth and on scaling the systems that they build. The more, the better.

The goal of a freelancer is to have a steady job with no boss, to do great work, to gradually increase demand so that the hourly wage goes up and the quality of gigs goes up too.

The goal of the entrepreneur is to sell out for a lot of money, or to build a long-term profit machine that is steady, stable and not particularly risky to run.

The trap is simple: Sometime freelancers get entrepreneur envy and start hiring other freelancers to work for them. This doesn’t scale. Managing freelancers is different from being a freelancer. Managing freelancers and saving the best projects for yourself gets you into trouble. The cash flow gets you into trouble. Investors don’t want to invest in you because you can’t sell out if you’re a freelancer at heart.

If you’re an entrepreneur, it is impossible to succeed by using your own labor to fill the gaps. That’s because your labor is finite. It doesn’t scale. That’s because if it’s a job only you can do, you’re not building a system, you’re just hiring yourself (and probably not paying enough either).

The solution is easy. If you’re a freelancer, freelance. Figure out how to do the best work in your field, the best work for the right clients. Don’t fret about turning away work, and don’t fret about occasional down time. You’re a freelance for hire, and you need to focus on your reputation and the flow of business. Find partners if you like but keep the cash flows separate.

If you’re an entrepreneur, don’t hire yourself. Build a business that works, that thrives with or without you. It might not be good for your ego, but it will be good for your bank account.

Whatever you do, don’t mix em up.

When the Iphone first came out, there was a “honeymoon” period when the product was just so revolutionary that people overlooked simple necessities like good reception. But after a few weeks, reports started coming in about poor reception and frequently dropped calls. Months passed, and then Apple finally came out with version 2.0 of the software. A noticeable feature was “a reduction in lost calls.” Another interesting change in version 2.0 was the icon for the reception indicator itself.  Yes, they fixed the problem, but Apple also wanted people to SEE a visual representation of the difference. So, they made a SLIGHT variation in the way the reception “E” and “3G” indicators look. Most people didn’t notice – but those who were most annoyed with their previous reception probably did.

Just as war-torn countries and embattled companies need to see a fresh face in leadership in order to regain trust, sometimes customers need to see visual change to believe intrinsic change. As leaders of small businesses, we must realize that fundamental improvements are often not enough. To visually communicate a change, we must place ourselves in the shoes of the skeptical. How can you make visual tweaks to embody the changes that are made under the hood in your company?I asked a few seasoned leaders for tips, and they shared a few suggestions: read more

1. Call every customer and thank them for the business. Ask if they’re happy with the work you’ve done. Ask if there’s anything you can do to improve. Don’t do the all in one day. Do five a day, with enough energy and time to show that you really mean it.

2. Show up. Show up when you make an appointment, show up at the right conferences. Show up in the local paper, issue press releases.

3. Make time for the first two by immediately ceasing to attend any event designed to connect you with struggling small business people in your community or industry. Stop connecting online or offline with people who whine but never deliver new business. Be ruthless.

4. Offer every one of your employees a huge referral bonus on any friend or acquaintance they bring to your business. Even if you don’t make any money on these first sales, it will create momentum.

5. Start a blog. Use it to tell the truth about your industry. Highlight your competitors who do a great job, expose the pitfalls that uninformed customers often face.

6. Keep a journal. Write down every single thing you do in a day to get new business. Watch the list grow daily. read more

My wife’s small business, based on accounting and tax prep services, is entering its third year.

1) We operate on a tight budget, stretching the earnings from the previous year’s tax rush… always holding back a chunk for tech upgrades during the Christmas sales season. This year we’re expecting our “nest egg” to go farther than ever. Operating on a budget and holding a reserve has always been a gem of financial wisdom, so nothing new there.

2) With some less stable businesses going under we’ve found a fantastic upgrade to our location, just in time to make the move before the next rush. Staying fiscally sound and looking for opportunities to grow in this environment can open up a hidden growth potential.

3) A bit of psychology can help as well. Right now we could be poised on the brink of certain economic doom, but there’s little proof of that. So the glass could just as easily be half empty, and if we are confident that our “T’s” are crossed and “I’s” dotted, then we should also behave confidently in our daily business practices, and let the forecasters rail on about doom and gloom… while we maintain the daily chores to build sound businesses upon solid business practices.

For ultimately they are forecasters, and we are business owners. We will tell the tale, our actions will decide the outcome. If we call the game before the rain, we may just squander a perfectly good game, for what might have been. Or we could be ready to play ball when the time has come, and play the game of our lives.

Pump up your marketing spend in a recession, some experts argue. Slash expenses, including marketing, say others — after all, there’s less business to be had. But neither approach gets it right. The best strategy is to cut your marketing spend in some areas - but increase it in others.

Learn the smart way to decide where to place your precious marketing dollars from Knowledge@Wharton, the Wharton School’s online business journal, in this conversation with Wharton marketing professor Eric Bradlow.

 

 Knowledge@Wharton interview with Eric Bradlow: Play Now | Play in Popup | Download