The article was written by Revett Eldred who founded, built, and sold Minerva Technology, a successful multiple award-winning system development business. He is an advisor to StartupSoft.com
Like every entrepreneur, you like to feel that your company offers quality products and/or quality service. It’s part of what drives you to start and run your business.
But no matter how hard you try to please everybody, there will come times when you just can’t. You will have unhappy customers; you will have unhappy employees. So expect both – hopefully not too often! – and learn a few tips on how to deal with them.
Unhappy customers
Customers can become discontented for two reasons: either your product or service failed them in some way, or their expectations were out of line to start with. Either way, in their mind you have dropped the ball, and they expect you to fix the issue, whether that position is reasonable or not.
Here’s what to do if things go south.
Get the facts. Realize that the issue may have been building over a period of time, even though it has only recently come to a head.
In the customer’s eyes, the issue may have arisen quite suddenly. But the reality may be that it has been building over a period of weeks or months. Do a little homework before you deal with the customer and find out what are the facts of the problem. You are more likely to come to a satisfactory solution if you are pre-armed with the facts.
Listen. Before you go nose to nose and start arguing about whose fault things are and who caused what issue, take some time to allow the customer to let off steam and to let you know why he is upset. Start the process of reconciliation by listening. If possible, meet the customer face to face. If not, phone or Skype. But never try to resolve satisfaction issues by email or messaging.
The customer will likely want to vent. Let him! Don’t interrupt, don’t try making suggestions, don’t apologize or keep apologizing, don’t argue; just keep quiet and listen. Make sure you truly understand what his issue is; don’t jump to conclusions.
Take notes. The customer will likely refrain from making wild accusations if he sees you noting down points he brings up. And you can refer back to them later on when you are building a plan to fix the problem.
Empathize. Put yourself in his shoes and try to understand why he is upset and what the ramifications may be. Has your mistake caused him some kind of embarrassment with his customers, his Board, his employees? Or is he just mad because he feels he has wasted his money?
Admit. When the customer has had a genuine opportunity to explain the issue to you and to get it off his chest, admit your error. That doesn’t mean admit to something you didn’t do wrong, it means accepting that in the customer’s eyes you have dropped the ball somewhere. Admit that the error occurred and agree with the customer as to what the error was.
Ask. Ask what the customer would like you to do! Don’t make any suggestions; as often as not what the customer expects will turn out to be less than what you would have been prepared to offer.
Don’t commit too soon. It is best not to commit to a solution during your first meeting with an irate customer. Better to summarize his complaints, agree what the issues are, make sure you understand what he expects you to do, and then ask for a day or two to see what you can come up with. If the customer has had a chance to vent and to state his desired remedy, he will likely be calmer in any subsequent meetings.
Develop an appropriate remedy. Even if you and the customer agree that the fault is 100 percent yours – unlikely, but even if you agree to that – find a way to repair or compensate for the issue that has the customer upset.
Even if you don’t think you have done anything wrong, remember that when a customer is unhappy he is likely to tell up to ten other people, but when a customer is happy he will only tell one or two. So you have to minimize the unhappy ones.
But the best way to handle complaints is not to get them in the first place.
There are two ways you can do this: manage the client’s expectations, and implement processes and procedures that ensure quality.
Manage expectations. Over-promising is easy to do in a competitive environment, but sooner or later it will come back to bite you. Avoid the temptation to promise more than you know you can deliver. Understand that a customer is dissatisfied when your product or service fail to meet his expectations. The higher his expectations to start with, the more likely it is that you will fail to meet them.
Do everything you can in the sales process to ensure that the client expects no more than you can deliver. Promise reality, not the sky. It is better to lose a bit of business than to gain it and find you are doomed.
Implement quality. Quality should be built in, not added on. All the wishing in the world won’t guarantee quality; you have to build it in. Study kaizen, the Japanese system of continuous improvement. Foster a culture of quality from the day you start your business. Talk the talk but, more importantly, walk the talk. Make sure that your every action, no matter how unimportant or trivial, sends the message to your staff that quality is the number one criterion in everything you do.
Most importantly, understand that just wishing for quality may help but won’t ensure it. You have to build in specific processes, measures, and procedures.
There is far more to this than can be covered in a brief article like this. Take the time to learn. Google kaizen – there are numerous articles and videos that will get you on the right path. Read almost anything written by the late Dr. W. Edwards Deming, the father of total quality management (a phrase he hated!) No matter what business you are in, quality can be built in if you do it right, and do it right from the start.
Unhappy staff
Your business is more than just a way to make money. It is your baby. You conceived it and brought it to life. It is a matter of pride as well as a company. You live it, you sweat it, you dream it, you worry it.
But to your staff, no matter how loyal they are or how long they have worked for you, it is a job. If they enjoy what they are doing, and if you are paying them well and treating them fairly, they will stay with you. But to them it is always just a job. If they stop liking it, they can look for another job elsewhere. If they think they are underpaid, they can look for a job that pays more. If they don’t like any aspect of their work for you, they can find something better.
So you are vulnerable from the start when it comes to keeping staff happy. And to compound your woes, more and more jurisdictions are implementing more and more restrictions on how you can treat employees – how much to pay them, how much vacation they must be given, how much notice they must be given if you need to terminate their employment, how much maternity/paternity leave they must be given, and so on.
It is therefore cheapest in the long run to pay and treat staff as well as you can. Here are a few simple guidelines.
Pay as much as you can, not as little as you can get away with. It is far more expensive to hire a new person than to keep the one you already have. If you are paying as much as you can, and if the employee knows it, they are unlikely to demand more. If they leave to work for another company, so be it: they are obviously worth more to the other business than to yours.
The sweetness of a salary increase rarely lasts longer than a couple of months, so it is better to give a small raise every three to six months than a big one annually, even if the amounts involved are identical.
Involve the staff in planning, quality control, marketing, and generally running the business. Make sure they know what the business is trying to do and be, and what their role is in that. Delegate quality management to the people who actually do the work. Give them time and authority to identify and implement improvements.
Be open, be honest. In my company we used to have monthly noon-time staff meetings at which the company provided lunch. First, people ate. Then we would publicly introduce and welcome new staff. Then we would summarize the previous month in terms of successes and failures we had experienced. And then I would present a summary of the company’s books: income statement, balance sheet, cash flow report. I not only presented the numbers, I explained them as most employees have no idea what the significance of most accounting numbers is – the difference between cash and revenue, for example. Presenting numbers like this was often criticized as being dangerous as it meant that virtually any of our competitors could easily find out how well or badly we were doing. But what it did was cement in the minds of all staff that we really, truly did trust them to the extent that we shared with them our most private data. That was a very powerful message and was part of the reason we experienced less than half the staff turnover of our competitors.
Remove roadblocks. Nine times out of ten, an unhappy employee feels that way because either they are not getting on with their boss or they are frustrated by red tape and what they perceive as dumb requirements. If the problem is their boss, make sure that boss has the training, support, and temperament to be a good boss, and make sure – this one is critical – that they subscribe to and believe in the culture of the company. You can’t just promote a worker bee and expect them to be a good manager and leader. They need to be given the tools for the job, which includes training. Is it expensive? Yes. But it is much cheaper than having staff turnover.
Remove the red tape. It will surprise you how quickly what you think are simple, logical procedures can turn into bureaucracy, even in the smallest and most nimble of companies. Silly rules proliferate with surprising speed and have a negative effect far in excess of their importance. Look for them, root them out, and prevent them from being reintroduced.
Leave your door open. All staff must feel free at any time to come and talk with you if something is on their mind. An open door to your office is a subtle way of letting them know that now is OK. A closed door tells them that you are working on something that cannot be interrupted. As long as your door stays open most of the time, your staff will respect your private time and will learn that they can talk to the boss when they feel the need.
Listen.But wait. Just as with an upset customer, the first thing you have to do with an upset employee is listen. Hear them out. Ask leading questions. Listen between the lines – they may not want to come right out and say what is troubling them, particularly if it is a matter of personality clash. Ask what they would like you to do. Promise them only that you will look into the matter further and get back to them within a day or two. Then do your homework. If appropriate, talk to others who might be involved.
Get back together with the unhappy one, listen some more, and then suggest whatever solution you may have come up with. As with anything else in business, be prepared to negotiate. And always be prepared to walk away, which may involve suggesting that the employee might be better off looking elsewhere for a job. No, you don’t want it to come to this, but there will be times where it is the only solution.
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