BUSINESS MANAGEMENT TOOLKIT
It’s often a struggle to balance the growing operation with the front‐office responsibilities. Please use this guide to help with staff development, improve customer service, encourage innovation among your teams, make better hires and improve sales. Share this guide with managers, supervisors and anyone in your organization who may benefit. Page 1 of 16 Employee management 10 Tips for building an entrepreneurial culture where employees can truly thrive. By Michael Houlihan and Bonnie Harvey We all know today’s companies need to be more nimble, more innovative, and more entrepreneurial, and that this shift begins with employees. Don’t we? Yes, we do. By now, so much ink has been spilled on the need for employee engagement and empowerment that our eyes glaze over when (yet another) expert starts in on it. What we don’t know is how to effect the culture change that needs to happen—especially when the organization we lead is already set in its lumbering, bureaucratic ways. The good news is there are some very specific steps you can take that will start the reaction shifts in your culture. It won’t happen overnight but it will happen. You just have to take the right actions. We know how to create engaged, empowered employees because we’ve lived it. We started Barefoot Cellars in the laundry room of a rented Sonoma County farmhouse and grew it into America’s No. 1 wine brand. We were able to do so because of our dedicated employees. Today, we teach corporations how to establish and strengthen entrepreneurial company cultures. In our book, “The Entrepreneurial Culture: 23 Ways to Engage and Empower Your People,” we explain how we kept the spirit of entrepreneurship alive in our company. Here we present tips excerpted from The Entrepreneurial Culture, on how to create an entrepreneurial culture at your organization. Hire for hustle A great way to separate the entrepreneurial thinkers from those who aren’t is to place a special emphasis on hiring people with a sense of urgency; people who can and will move quickly; people who don’t always have to be told what their next step should be. In other words, don’t hire solely based on someone’s technical skill set. You can always teach that. You can’t teach the other stuff—and that other stuff is what will make the difference between an average company and a great company. At Barefoot, we called that “other stuff” hustle. And we devised a few methods to use during interviews to figure out who had hustle and who didn’t. For example, we would sometimes ask candidates to go out and get us some waters. We would watch to see if their actions were deliberate, determined, and focused, or unstable and slow. Another great way to judge hustle is to give them some homework. During the interview, give candidates a verbal run‐down of the position, your company’s challenges, and your expectations for the position. Then, have the candidate send you a one‐page summary on a deadline. This will tell you volumes. Don’t skimp on training Many companies approach orientation like it’s a formality. New employees are ushered in, given a quick tour of the office and a rundown of the benefits offered, and then they’re expected to get right to work. Well, this minimalist approach to training can have some counterproductive consequences, especially where judgment, relationships, and potential are involved. Being thorough with training will take more time, energy, and maybe even money on the front end, but the long‐term benefits of making sure your people know not just the “whats” but also the “whys” of their jobs will be worth it. Professional development is an essential part of attracting and keeping the best talent. People want to stay with companies that care enough to invest in them, not just via their salaries, but by helping them Page 2 of 16 develop the skills that will help them build their careers. If you’re not providing this kind of training, rest assured, they will move to a company that provides it. Use performance‐based compensation When you have a compensation plan based on an hourly rate, you’re paying for attendance, not production. Regardless of how much they do or don’t accomplish, your employees will have an “I was there; pay me!” attitude…and can you blame them? However, while running Barefoot, we learned that performance‐based compensation is better for everyone: you, your employees, and your company as a whole. Here’s an example of how we made performance‐based compensation work: If someone sold 100 cases in April 2000, and 100 cases in April 2001 (these numbers are unrealistically small for simplicity), their commission would be the same in both years. But if they sold 10 percent more—110 cases—they would get $1 for every case over that 100, or $10 more. If they sold 20 percent more in April 2001—120 cases—they would get $2 per case for every case over 100. Not just $1 for cases 101‐
110 and $2 for cases 111‐120; they would make $2 for each case over 100, or $40 more. They didn’t just get higher pay for additional growth; they got the boost for all the growth. It kept multiplying. So, 30 percent more—130 cases—would earn $3 times 30 cases, or $90, and on up. We created a pretty radical pay system at Barefoot for a simple reason. Barefoot was a small company that needed to sell large quantities of merchandise, and we couldn’t afford unproductive people. Basically, our compensation system meant that producers couldn’t afford to leave, and non‐producers couldn’t afford to stay. Meanwhile, we constantly attracted new go‐getters who were willing to bet on themselves. Get out of their way When your company isn’t able to meet its goals, your first inclination might be to blame your employees for being unable to execute. But you should take a look in the mirror before doling out blame. That’s because often, leaders who want to blame their employees for not executing are actually using a leadership style that is keeping people from getting things done. Do you find it difficult to delegate important projects? Do you refuse to let their work see the light of day until you’ve personally reviewed it, leaving them twiddling their thumbs until they’ve received your feedback? Do you insist on running every new idea through legal before letting an employee pursue it? Are you a micromanager? Be honest. Do you engage in any of these behaviors? If so, it’s important to stop, step back, and show your people that you trust them to make important decisions and do important work. When you do, you’ll give your team the freedom they need to help move the company forward—and you’ll free up a lot of time and energy for yourself, too. Delegate effectively There’s a misconception that many leaders simply refuse to relinquish control of any of their tasks or projects to one of their subordinates. But often, it isn’t about control at all. Many leaders want to delegate, but they don’t want it to look like they’re just dumping unwanted tasks on their employees, or they don’t feel they have the time needed to train an employee to do a task. Here’s the first step to take when it comes to delegation: Start handing over those tasks and projects that your employees can do or can almost do without your input. Trust their expertise and trust that if they really hit a wall, they’ll come to you. Everyone has a unique set of skills, abilities, and talents. Often, your people will have firm—and sometimes surprising—ideas about what they’d like to take on. Page 3 of 16 We’ll never forget when one of our front desk employees suggested she work in accounts receivable. We were surprised because this was the department that collected money owed to Barefoot, sometimes by people who, let’s be honest, preferred to stall. Turns out she had done similar work for her parents’ insurance company. Her insight, along with the fact that she was hyper‐organized, understood people, and was charming, allowed her to excel in her new position. Within months, accounts receivable was humming, and pretty much everyone who owed money seemed unusually good about paying up. Let information flow freely Some companies use information as a type of currency—the right juicy piece of info can buy you lunch, help get you a promotion, bring kudos your way, or be traded for other valuable information. The flipside of this, of course, is that in large siloed organizations it’s completely normal for one department or division to have no clue what the others are up to. Instead of a “need‐to‐know” policy at Barefoot, we advocated a “know‐the‐need” approach. Your people are full of intelligence, ideas, and passion—you just have to unlock those things. So do whatever you can to engage your entire team and keep the information free‐flowing. Of course, the most important way to achieve this is through transparency. And that means being transparent about the bad stuff, too. You may be tempted to keep bad news and problems to yourself. Don’t. Be honest about the challenges your company is facing and ask the entire staff for solutions. You’ll probably get them. Don’t wait for perfectly sunny conditions To create a culture where entrepreneurial thinking can thrive, you must make sure everyone understands that great ideas are always welcome. Then, give your employees the freedom to move forward on projects, even when conditions aren’t exactly sunny. The truth is, if we had let our “we’ll be ready whens” dictate our business decisions, we’d probably still be wannabe winemakers. When we launched Barefoot Cellars, all we had was a laundry room to use as an office, a bank account that was running on fumes, and no knowledge of our industry. And yet we gave ourselves the freedom to take the leap. We knew the risks, but we believed in what we were doing, so we went for it. You have to give your employees the same benefit. The truth is, conditions will never be perfect for any idea or initiative. Instead, you need to settle for “mostly sunny with a chance of showers” or even “light drizzle,” and plan to get a little wet. Keep in mind that if your employees don’t ever feel comfortable enough to share these ideas or launch these projects, your company will definitely never benefit from them. Never waste a perfectly good mistake Most leaders look at mistakes as something to be avoided, and as a result, they pass that sentiment down to their employees. But the most innovative, agile companies embrace mistakes. When you move from a culture that punishes mistakes to one that embraces them, your employees will have the freedom to take risks, and that’s where entrepreneurial thinking leads to great innovation. When an employee makes a mistake, you want a culture that encourages him or her to learn from the mistake and change what led to it rather than a culture that encourages him to fear punishment and sweep that mistake under the rug. You want an environment where employees can acknowledge mistakes, take responsibility for them, learn from them, and then move forward. I can’t stress enough how very important it is to investigate how and why an error occurred so that the faulty procedure or process can be fixed. That’s why Barefoot made sure employees weren’t afraid to make or report Page 4 of 16 mistakes. Basically, our approach to mistakes was to say, “Congratulations. You found a new way to screw up, and that’s a good thing. We didn’t know that this could happen, but now that it has, we can keep it from happening again.” Once you’ve figured out why a mistake happened, resolve to stop playing the blame game. Instead, encourage your employees to aim their focus on what they can do to prevent the situation from reoccurring. Ask, “How would I like it?” Relationships have never been more important. A great way to ensure everyone at your company is committed to building strong relationships is to constantly ask, How would I like it?, otherwise known as the Golden Rule for business professionals. Regularly ask yourself the following questions and answer honestly—even if it’s uncomfortable:  Would I want to work for an employer who treated my labor as a commodity, trying to see how little I would work for? Or would I prefer an employer who sees people as assets, rewarding them for performance and acknowledging their achievements?  As a leader, am I open and honest with employees about where the company stands, what challenges we’re facing, and what I want?  If I were a vendor and had two clients, one who treated me with respect and dignity, and another who viewed me as a necessary evil (and maybe even thought I was a huckster or trickster), which one would get preferential treatment? With which would I share what I know about their competition?  Would I buy from a company that treated me like a pain in the neck if I had a problem with their product, or would I prefer to buy from a company that thanked me for bringing my concerns to their attention? At Barefoot, we believed that customers look for overall value when buying a product, not just a low price. That’s why we turned down opportunities to cut costs and labor many times. We felt that these measures (which touched on everything from packaging to pricing to the wine itself) would reduce the customer’s perception of Barefoot’s quality. It’s also important to keep in mind that no matter what industry or field you’re in, the most critical decisions you’ll make as a leader will be shaped by your attitude toward your employees and by how that attitude affects how they treat people outside the company. So make sure the question, “How would I like it?” is never far from your mind. Say, thank you Making gratitude part of your culture plays an essential role in creating employees who feel empowered and engaged. In truth, you should be saying thank you to everyone you come into contact with through your company. Everyone, from employees to colleagues to vendors, will respond positively when you say—or better yet, demonstrate—your thanks. But let’s take a moment to focus on a type of thanks that can really make or break your business. The gratitude you express to or withhold from your employees. When your employees work hard on your company’s behalf, they deserve your thanks and appreciation. Don’t take them for granted. Make sure your people know that you have noticed their efforts and that you’re grateful for their knowledge and help. In return you’ll gain their buy‐
in, loyalty, enthusiasm, and over‐and‐beyond efforts. Acknowledgment and validation of stellar performance breeds more of it. Despite the chaos and uncertainty, this is a time of extreme opportunity for companies that recognize the value of entrepreneurial thinking. It is by far one of the greatest competitive advantages for companies today, and not just at the top of organizations, but at every level, from the bottom up. When you get your employees to think Page 5 of 16 like owners, it will solve the biggest problem in business right now: lack of engagement. Once they see the difference they can make, everything will change. They’ll be excited to be part of the process. Sales techniques Use the P.L.U.S.H. process methodology to drive sales away from price and toward value. By Chuck Reaves In the history of recorded time, no customer has ever said, “Your price is too high,” and meant it. Even though it is the most frequent objection that salespeople hear, the price objection is not valid. So, when the customer mouths the words, “Your price is too high,” what are they really trying to say? It can be one of a number of things, such as: “I don’t perceive the value to be higher than the cost.” “I don’t see any difference in your offering and your competitor’s.” “I don’t think my problem is as expensive as your solution.” You will notice that the word price does not appear in any of these responses. There are two ways to sell: value‐added selling and commodity selling. With commodity selling, the customer assumes all offerings are the same and so the sale defaults to the vendor with the lowest price. In value‐added selling, the customer perceives there is a difference between the offerings and makes their buying decision on cost, not price. Customers will perceive this differentiation when the sales professional has done their job. The only relationship that exists between cost and price is an inverse relationship. The item with the lowest price tag typically costs the most. As an example, you can purchase a shirt for $40 or for $8 – which costs the most? The price difference is obvious but which one will last longer, look better, feel better, etc.? Sales is a science, not an art. As such, successful selling follows a process. In quality terminology, this is known as standard work. Even though every salesperson is different and every customer is different, there are still measurable steps your salespeople can follow that will drive the sales process away from price and toward value. There are five principles behind a successful value‐added sale. As a memory aid, these steps follow the letters in the word P.L.U.S.H. When used effectively, you can overcome or even eliminate the price objection. What would it be worth to you to never hear the price objection again? P – positioning Begin by talking to the right person. Many purchasing agents use price as the primary differentiation so who else could you sell to in the client’s organization? Identify the person or department that will benefit most from what you are selling and sell to them. The purchasing agent may have been given the buying criteria from someone in another department. In that case, the buyer may not understand what they are buying well enough to alter the criteria – even if when what you bring to the table is better. Find the right person and then ask the right questions. Page 6 of 16 L – listen It is amazing what people will tell you, it is amazing what people will give you if you just ask. The secret to successful selling is the ability to ask the right questions the right way in order to determine the customer’s real buying criteria. Most customers do not know what they want. They will buy something that is not the best solution for them and they do so based on their limited understanding of what they are buying. Can you keep up with all of the changes that are happening in your market, industry, competitor’s organization or technology? What makes you think your customer is keeping up? It’s virtually impossible for the human mind to ignore a question. When you use questions, you will engage your customer’s subconscious mind and make an impression. Stop talking, ask questions and listen. U – unique What really makes your product, service or organization unique? If someone asked you what made your product or service different, what would you say? If you were to use words like quality, service, people, etc. you would actually be commoditizing yourself. How many of your competitors are using those same words? Even though your service or quality levels are measurably higher than those of your competitors, using the same words they are using dilutes the value of the differentiation. What really makes you different? Ask your existing customers. S – solution Every trained salesperson has learned some aspect of solution selling. It is the backbone of most sales processes. In value‐added selling, sales professionals take it to the next level. They begin by asking some version of a common question: “What are the top three problems facing your business right now?” Seasoned salespeople have learned that the customer will rarely tell them what the problems are, even when they try. They will answer, with something like, “Our sales are down,” “Our attrition is too high,” “Our manufacturing costs are up.” None of those are problems. They are all symptoms. Something is driving their sales down and their attrition and costs up. The value‐added sales professional understands this. Rather than arguing with the customer – “Isn’t that really a symptom, Mr. Customer?” – and rather than offering a solution, the professional takes two more steps. The next step is to qualify the problem by asking the customer how and when the problem manifests itself. Then, the sales professional asks what the cost is for each manifestation. By the time this line of interest (not inquiry) is complete, the salesperson and the customer will have a clear understanding of what the real problem is and what it is costing. When the salesperson quotes their price, it is in comparison with the real cost of the problem it will solve. H – help Helping means doing everything the customer asks, and then some – and getting credit for it. Known as the “extra mile”, it is probably something your organization is already doing. Your customer may not appreciate your extra efforts because they do not know you are doing it. Brag about yourself. To overcome or eliminate the price objection, make sure you are talking to the right person, asking the right questions in order to show which of your specific differentiations are most viable for them. Then justify your higher price by quantifying your value. Keep your customer and earn referrals by going the extra mile. Page 7 of 16 Hiring tips
Seven tips for adding “A‐players” to your organization. By Richard J. Bryan Your business doesn’t run itself. The quality of your organization depends on the quality of your team—a motivated, energized staff is the key to companywide success. You want A‐players, those colleagues who contribute disproportionately to the advancement and profitability of the organization. In the same way that the Pareto Principle states that 80 percent of results come from 20 percent of your employees (based on research by the Italian economist Vilfredo Pareto in the early 1900s), your A‐players have a measurable impact on your bottom line. The Pareto Principle is often used in a sales environment, but it applies equally to a variety of different industries. If you can build a team of A‐players around you, then your job as a business leader or owner becomes much easier, as you do not have to deal with endless crises and can work more intentionally on developing the future strategy for your organization. So how do you find A‐players for your team? The funny thing about A‐players is that you can find them in the strangest of places. A few years ago, James was running a car dealership that was lacking in quality salespeople. He received a call from his wife while she was out shopping for strollers, and asked him to meet her at the store. “I want you to meet Louise. She has a great attitude and I think you’ll like her.” Ten minutes later he was walking into the shop to meet Louise. She was a class act and spent the next half an hour asking them lots of qualifying questions about their lifestyle. Once she had all the information she needed from them, she launched into a brilliant sales demonstration of various products. She was impressive. They ended up spending more than $1,000 in the shop that day and were absolutely thrilled with their interactions with Louise. James was particularly impressed by her enthusiasm, her energy and her ability to listen intently to their needs, and then repeating this information back when closing the sale. Too many sales people believe that selling is about talking, but in reality it is actually about the ability to listen to your customers so that you can truly understand their needs. A few days later James went back to her store and offered her a job. He was not sure that selling cars had been on her career plan, but to her credit she took a risk and joined the team the following month. Initially, Louise struggled a bit because she had no product knowledge, no customer base and was the only female on a sales team of 30 people. However, after continual support from James and the upper‐level staff and a combination of hard work and positive attitude she began to flourish. By the end of the year she was the top sales person at the dealership. Page 8 of 16 When you are seeking A‐players for your organization, don’t just look for skills and experience but start by looking for someone with a great attitude. Here are seven tips to help you find your own A‐players. One‐page plan Have a simple one page plan that you can share with future employees. This plan highlights what you have achieved as an organization during the past year and also what your vision is for the next three to five years. A‐
players are motivated as much by being part of an organization that has clear goals and aspirations as they are by salary and benefits. They want to be part of an organization that has a purpose. Think outside the box Don’t just look in the same old places for new employees. Think about looking outside of your industry for people with the right attitude and a track record of success. You can always train skills and product knowledge. Telephone screening interview Consider having a 15 to 20 minute telephone interview with potential candidates. This can save both parties a lot of time and expense before a more formal interview is arranged. Personality profiles Use DISC or another similar personality profiling tool to make sure that you have a good fit for the role you are seeking to fill. Different fields require their own unique brand of skills, such as high‐influencing personalities or levels of compliance. Watch the body language Always have another person interview with you and if possible get them to ask the questions, so that you can concentrate on listening to the answers given and also observe the body language to make sure that it is congruent with what is being said. References Always insist on speaking to a former boss for a reference. Sometimes it is not what is said about the candidate but the way in which it is said over the phone that can alert you to potential problems but also provide clues to the positive aspects of the candidate. Written references are usually very brief and not very helpful. Staff referral program Have a program in place that rewards existing members of staff if they recommend someone for a position you are trying to fill. For example, you could offer a cash bonus to your employees if their recommended candidate is taken on, and another bonus if the candidate is still with you and performing well six months later. This has the added benefit of ensuring that the new member of staff has a mentor looking out for them during their initial six months. Try some of these tips and see what works best for you. If you can surround yourself with a team of A‐players who have great attitudes, are motivated by achievement and are strong in areas where you are weak, then your role as a leader or business owner becomes far easier. You can concentrate on setting the future strategy for your organization while your team achieves amazing results. Page 9 of 16 Keep employees happy
When raises aren’t in the budget, try these strategies to keep your employees content. By William J. Lynott When the budget is too tight to allow the raises that you’d like to give, it’s important to understand how a little love can save the day. As far back as 1924 when the so‐called Hawthorne Studies originated, researchers began to understand that employee behavior is not dependent on money alone; far from it. In fact, job satisfaction and performance often depend heavily on factors that have nothing at all to do with money. And nowhere is this more important than in labor‐intensive businesses. Of course, reasonable pay is the foundation of job satisfaction and productivity, but it cannot do the job alone. Despite all of the studies on the subject over the years, motivating employees is still far from an exact science. Each person has his or her own set of reasons for working and they are as individual as the person. Here are five things that you as an owner or manager need to know to improve the motivation and thus the performance of your employees. Self‐esteem Every human has a powerful need to feel respected, to be accepted and valued by others. This need is felt in every aspect of a person’s life; and nowhere is it felt more strongly than in the workplace. From brain surgeons to salesclerks, the craving for self‐respect and recognition is so strong that it can dominate and control employee behavior and performance regardless of financial considerations. The work of an employee who is left with no reason to think that her boss respects and values her contribution is almost certain to fall well below her potential. Lack of recognition preys on the susceptibility of many workers at all levels of our workplace hierarchy who are starving for self‐respect. Failing to supply it provides a perfect setting for the loss of initiative and lowered work. One of the simplest and most effective ways to develop and demonstrate sincere interest in your employees is to learn something about each one, including such simple things as the names of spouse and children, hobbies or special interests, and then following through with a little conversation that shows you remember them and are genuinely interested. Employee equalization Favoritism, or even the appearance of it, can be a deadly enemy of positive employee attitudes. An employee who feels that he or she is the victim of favoritism is likely to develop an unseen grudge that can silently but effectively damage your business. Make a constant effort to show appreciation to your staff in a fair and equitable manner. Any indication that you regard one employee with more respect or appreciation than any other is a certain path to negative employee morale. While it’s not always possible for you to avoid regarding some employees more highly than others, Page 10 of 16 allowing that feeling to become obvious to others is a serious management failure, one that almost certainly will exact a costly penalty. Safe working conditions Personal safety is one of those instinctive human needs that rank near the top of our subconscious concerns. Management must take reasonable precautions to protect employees from workplace harm. One of the most obvious demonstrations of this concern is an on‐going and visible effort to make certain that all equipment, electrical and mechanical, is in good working order and is checked on a regular basis. Another working condition that can affect employee attitudes is cleanliness. While a nursery is obviously not a hospital environment, an on‐going effort to maintain reasonable neatness and cleanliness in the workplace demonstrates a respect for those who spend their working hours in it. Non‐cash incentives A recent report by the research firm McKinsey & Co. on motivating people strengthened the importance of recognition and non‐cash incentives in the workplace. In particular, the report points out that non‐cash incentives (including sincere praise and recognition from immediate managers) is often a stronger motivator than traditional incentives such as bonuses and stock options. This is of particular importance to small businesses operating on tight budgets. Non‐cash awards can include such obvious things as a fruit or flower basket, or dinner out with the boss. The only limit is your imagination. Not to be forgotten, however, is the one often suggested as the most important of all – praise and recognition from the boss. None of this is to suggest that money in the form of wages isn’t the heart of positive motivation, only that money alone is not likely to inspire the kind of motivation that brings out the best of performance in your employees. Respected leadership A serious disincentive for employee motivation generated by some owners is failing to accept the blame when something goes wrong. A reputation for always putting the blame on others is a management deficiency that will eventually cause employee unrest. Being in charge means being willing to take responsibility for whatever happens on your watch. In any business, the owner’s behavior, actions and attitudes establish guidelines for employees. “If a leader wants to build an atmosphere that promotes positive motivation, he or she needs to discuss problems with employees in a private setting. If he wants people to work hard on Fridays to get ready for the coming weekend, he needs to stay late himself. If he wants courteous employees, he must offer courtesy to others. In short, the person leading the company must display the behavior he or she wants others to emulate,” says Sally Mounts, president of Auctus Consulting Group in Washington, Pa. Page 11 of 16 Steps for innovation
Implement these seven solid steps to encourage innovation in your operation. By Neal Thornberry Everyone says they want innovation in their organization, but when an ambitious employee offers it to a CEO, for example, the idea is often shot down. Senior leaders often miss the value‐creating potential of a new concept because they either don’t take the time to really listen and delve into it, or the innovating employee presents it in the wrong way. Innovation should be presented as opportunities, not ideas. Opportunities have gravitas while ideas do not. Use these seven steps as a template for innovation. 1. Intention. Once the “why” is answered, leaders have the beginnings of a legitimate roadmap to innovation’s fruition. This is no small task and requires some soul searching. I once worked with an executive committee, and I got six different ideas for what innovation meant. One wanted new products, another focused on creative cost‐cutting, and the president wanted a more innovative culture. The group needed to agree on their intent before anything else. 2. Infrastructure. This is where you designate who is responsible for what. It’s tough, because the average employee will not risk new responsibility and potential risk without incentive. Some companies create units specifically focused on innovation, while others try to change the company culture in order to foster innovation throughout. Creating a culture takes too long. Don’t wait for that. 3. Investigation. What do you know about the problem? IDEO may be the world’s premier organization for investigating innovative solutions. Suffice to say that the organization doesn’t skimp on collecting and analyzing data. At this point, data collection is crucial, whereas brainstorming often proves to be a waste of time if the participants come in with the same ideas, knowledge and opinions that they had last week with no new learning in their pockets. 4. Ideation. The fourth step is also the most fun and, unfortunately, is the part many companies leap to. This is dangerous because you may uncover many exciting and good ideas, but if the right context and focus aren’t provided up front, and team members cannot get on the same page, then a company is wasting its time. That is why intent must be the first step for any company seeking to increase innovation. Innovation should be viewed as a set of tools or processes, and not a destination. 5. Identification. Here’s where the rubber meets the road on innovation. Whereas the previous step was creative, now logic and subtraction must be applied to focus on a result. Again, ideas are great, but they must be grounded in reality. An entrepreneurial attitude is required here, one that enables the winnowing of ideas, leaving only those with real value‐creating potential. Innovation without the entrepreneurial mindset is fun but folly. Page 12 of 16 6. Infection. Does anyone care about what you’ve come up with? Will excitement spread during this infection phase? Now is the time to find out. Pilot testing, experimentation and speaking directly with potential customers begin to give you an idea of how innovative and valuable an idea is. This phase is part selling, part research and part science. If people can’t feel, touch or experience your new idea in part or whole, they probably won’t get it. This is where the innovator has a chance to reshape their idea into an opportunity, mitigate risk, assess resistance and build allies for their endeavor. 7. Implementation/Integration. While many talk about this final phase, they often fail to address the integration part. Implementation refers to tactics that are employed in order to put an idea into practice. This is actually a perilous phase because, in order for implementation to be successful, the idea must first be successfully integrated with other activities in the business and aligned with strategy. An innovation, despite its support from the top, can still fail if a department cannot work with it. Dealing with tough clients
Understand 7 tough client types and how to win them over. By Andrew Sobel You’re a master at the work you do. Unfortunately, you’ve got one client (or maybe more than one) who’s so hard to deal with that you can’t get to a place where you can prove your value. Sound familiar? It should. From time to time, we’ve all struggled with a client who seems indifferent, constantly questions our judgment, or calls our cell phone demanding attention on a Saturday night. Early in my consulting career, I had a client who became downright abusive. When we first met, he was relaxed, confident, professional, and even charming. But underneath that veneer he was a mean‐spirited tyrant. As time passed, he became ever‐more demanding and even vicious. One day, I walked into his office with a three‐page memo I had written to summarize our conclusions. He noticed a typo on the second page and began angrily yelling at me. “This is shoddy, unprofessional work,” he shouted across the table, his eyes bulging and face turning red. “How could you show this to me? This is totally unacceptable!” His rant continued for a full minute. I had no idea how to handle it. I was only 28 at the time and I felt utterly trapped in the project. And while this is an extreme case, difficult clients are everywhere, and most of us will, at some point, have to deal with them. The good news is you can often connect with these people and even turn them into loyal fans. Sure, there may be the occasional need to fire a client, but for the most part, you can salvage the relationship. It’s just a matter of mastering some basic relationship rules and putting them into practice. Here are seven types of tough clients you need to be aware of and the strategies for dealing with them. The insecure client These clients are unsure of themselves and it manifests as them being unsure of you and nervous about failing or looking bad. They are difficult to work for because they micromanage you. They find it hard to trust outsiders and won’t let you build relationships with their boss or other executives in their organization—they keep you for Page 13 of 16 themselves. Insecure clients may also have difficulty trusting you to do new and different things for them, and they review your work over and over. The Prescription: Build more trust and reduce their perception of risk. This means investing in more face time, reassuring them about your product or service delivery, showing them what you’re doing at key stages of the engagement, increasing communications, and demonstrating utter reliability and consistency. Convince the insecure client that you should go together to see their boss, so that you will also have a relationship with him or her. Explain how this will ultimately help them and the program you’re working on together. You need to frequently reassure this type of client and give them a sense of control. The boundary pusher Clients like this perceive no boundaries around you and your work. They will call and email you at all hours of the day and night, expecting an immediate response. They don’t distinguish between something that’s truly important and urgent and an issue that’s just a simple “to do.” They invade your personal life and leave you feeling swarmed and even overwhelmed. The Prescription: It’s best to explain your boundaries at the very start of the relationship, especially if you suspect this may become an issue. Say (or write), on workdays, we respond to emails within four hours unless it’s clearly urgent, in which case we’ll get back to you within the hour. If something comes up over the weekend, unless it’s an emergency, we’ll respond Monday morning. If you didn’t set clear boundaries early on—or if you did, but the client is ignoring them—you can still alter their behavior without direct confrontation. Simply answer the email you get on Saturday on Sunday night or Monday morning; or, write a one‐liner back that says, “Steve, I’ll respond first thing Monday when I’m at my office.” Also, regularly prioritize with your client. Just say, “Mary, right now my priority is getting that analysis that we discussed in shape. Can this wait until Thursday?” The do‐nothing client There are some clients who just never move ahead and get things done. You meet with them, you talk, you agree on next steps, and so on—but then, nothing. This is more of a frustrating client than a “difficult” one. In fact, you might have a very good and pleasant relationship with a do‐nothing executive. Still, you need to produce, and that requires the client to move ahead. The Prescription: Explore what’s behind your client’s inaction. Is it insecurity and fear (see type one)? Are they hemmed in by a boss or another executive who is blocking them from taking action? Do they work in an organizational culture that is risk averse and prizes survival above all? There are many different reasons why a client doesn’t act, and you need to diagnose why so that you know how to address the inaction. Ask yourself if you might be able to work with them to reassure them about your approach—perhaps even having them talk to another client. Can you help them manage the stakeholders that may be getting in the way? Can you increase their sense of urgency by illustrating the costs of not acting? Also, ask yourself if the problem or issue you’re addressing is truly an urgent, important one. Maybe the client’s priorities have shifted. If so, you need to know that so you can help the client accomplish something that does provide value. Page 14 of 16 The know‐it‐all This client thinks they know more about what you do than you and is constantly telling you how to do your job. They give you way too many suggestions in areas that are really outside their expertise. They are overly directive. I’ve had clients, who themselves were terrible at group facilitation, try and tell me how to facilitate a training workshop. I’ve had others try and impose their own models for client loyalty, having just hired me to give them mine. The Prescription: Reestablish your respective roles. If gentle rebukes don’t work (“Through many years of doing this, I’ve found this is the most effective approach…”), you have to put your foot down with a Know‐It‐All client. Confront them. Tell them they have hired you because of your expertise and experience, and that they need to give you the proper berth to exercise it on their behalf. Twice I have had to say to clients, “When you buy a Mercedes‐Benz car, do you tell the salesman that you want to travel to Germany to inspect the production line and make suggestions to them about how to assemble your car?” Then I’d say, “I didn’t think so, because you know Mercedes is a great brand and understands how to make cars. Similarly, you need to let me do my job for you and not advise me on my own expertise.’ In both cases, the client laughed and backed off.” Mr. or Ms. Aloof Some clients treat you like a vendor and resist all efforts to build a real relationship. They are often very professional and can be perfectly pleasant when you’re with them. But it’s a purely arm’s‐length relationship, which seriously limits how much you’re able to help them achieve. The Prescription: Learn more about the client’s agenda and help them accomplish it. You may not truly understand their priorities—their underlying needs and goals. What’s important to them right now? What are they trying to accomplish this year? Everyone has a hot button—have you discovered what it is for this executive? Once you do, you’ll be in a better position to help them and go “above and beyond” the letter of your contract. Also, try and find out how your client views the relationship. It may just be that he or she feels the relationship is perfectly fine and doesn’t need it to be anything more than what it is. And that may be good enough for now. The insatiable client This client feels the work is never, ever good enough, and they also micromanage you—although for different reasons from the Insecure client. Their behavior can absolutely wear you down. You never feel like you’re succeeding. These people have carping, critical personalities and can’t give out compliments—who knows, maybe they grew up with overly demanding parents themselves! The Prescription: Carefully calibrate expectations at the beginning of each engagement or transaction. IT firms have “service level agreements” (SLAs)—maybe you need to go deeper into specifics around the type, quality, and format of your output for the client. Don’t become overly needy about getting compliments and positive feedback. This is a client, not your spouse, and as long as you’re doing a good job and achieving the agreed‐upon goals, you shouldn’t worry about getting a constant stream of praise. Page 15 of 16 The tyrant They have personality and emotional issues and treat their people—and perhaps you—terribly. Everyone who works for them hates them. Who knows why someone acts like this? There are many possible reasons. The Tyrant could be a good‐hearted person who happens to have an anger management issue, or they could be genuinely mean—like my client from years ago. The Prescription: If the client is nice to you, but tyrannical with their team, you may be able to coach them and influence them to change their behavior. Unless you’re specifically in a coaching relationship, however, they may not be open to that kind of personal feedback. If the client is treating you or your colleagues badly, consider moving on. Life is too short to spend time in abusive relationships, be they at work or in our personal lives. Occasionally you may be able to have a frank discussion with a Tyrant that results in improvement, but generally if bad behavior is that extreme, the person will not be able to hide their true colors forever. In summary, when faced with a difficult client, you should consider these four steps: 1. Assess. Diagnose why the person is acting that way. What’s behind the behavior? 2. Make an action plan. Identify remedial actions you can take to address the underlying dynamic (e.g., if a client is micromanaging you because of insecurity, what steps can you take to build greater trust?). 3. Confront. If appropriate, confront the client with their behavior (e.g., point out that they are second‐
guessing your expertise and experience and ask them to stop). 4. Finally, fish or cut bait. Decide what your boundaries are, and if you’ve really had enough, move on and focus on more fruitful relationships. You won’t need to fire a client often, but doing so can be extremely healthy, not only for your business but for your own sense of self‐esteem and well‐being. Just knowing you have a plan to deal with difficult clients can bring a huge sense of relief. Relationships may feel complex and mysterious, but, really, they’re subject to some pretty simple rules. When you learn them, and put them into practice, it can shift your work and your career to a higher level. __________________________________________________ QUESTIONS? Contact Editor Kelli Rodda at [email protected]. Page 16 of 16