The late Joan Rivers was reported to have told her daughter (paraphrased), “You get to be a pain in the ass in direct proportion to the value you bring to someone.”
Since starting my business over 2 decades ago, I’ve been extremely focused on ensuring I only do business on MY terms. After all, what’s the point of owning a business if you’re going to let everyone else (employees, clients, competition, etc.) dictate what you can and cannot do? Seems like you ought to just get a job and have one boss instead of dozens.
But as much as entrepreneurs crave freedom and give it as the #1 reason for starting a business, being “stubborn” and unwavering on the point of doing business on YOUR terms is not a popular one. A well-known marketing guru who I shall not name recently told the audience that after you get above 5 employees, you work for them, not them for you.
I’m not so sure about that. That’s exactly the kind of “from stage” nonsense that sounds good to an audience (look at me, the almighty powerful CEO who is wearing a hair shirt, giving the shoes off my feet to my employees) but it’s not really how things work. I put that right up there next to the “customer is always right” mantra. It’s true to a certain extent.
ALL client and employee relationships have, to some degree, an inherent conflict of interest.
If you are a good leader of your company, and your #1 job is to ensure the profitability and sustainability of your organization, then you will, at times, need to make decisions and take actions that are NOT popular with your clients and employees, NOT in favor of the customer, NOT what many would consider “service-oriented” or “fair,” but are necessary and the right thing to do for your organization, your growth, your sustainability and, ultimately, YOUR profits.
Doing business on YOUR terms for YOUR benefit.
Wow, that just sounds selfish.
This article is sure to fire up some well-meaning person’s hackles when they adamantly deny that THEIR relationship with their customers and employees is constructed of mutual respect and servitude – and that’s great if it’s true and not abusive to you, the business owner. Of course, we want to provide value, overdeliver and delight our clients. Of course, we want to create a workplace that our team finds to be of tremendous value, full of opportunity, learning and advancement.
But many of the relationships MSPs have with their clients and employees are very lopsided, where they are voluntarily getting taken advantage of for fear of appearing greedy, fear of losing a client, fear of getting a bad review or not being liked, fear of being judged as an aggressive, unreasonable, selfish a**hole.
Let’s take the client relationship as an example of the innate conflict of interest in that relationship:
YOU (or most business owners) would like to charge the maximum possible price.
Your CLIENTS want you to charge the lowest possible price you can offer.
YOU would like to have your clients buy EVERYTHING you are offering them.
Your CLIENTS only want to buy what they feel is absolutely essential, or even less.
YOU would like your client to listen to 100% of your advice and act upon it.
Your CLIENTS pick and choose what they pay attention to and act on.
YOU would like to require longer-term commitments, so you aren’t left holding the proverbial “bag” of costs, staff and commitments if a customer suddenly and arbitrarily decides to cancel.
Your CLIENTS want to be able to cancel anytime, without warning or consequences.
Back to Joan’s point, you get to demand the terms in direct proportion to the value you bring. But I would go a step further and say that if you are going to be truly effective as the leader of your organization, your job is to serve, but not to be a servant. If you routinely let your clients or employees bully or guilt you into doing business on their terms, you end up with an extremely weak organization and with the entirety of all responsibility and negative consequences on YOUR back.
I would further argue that insisting clients do business on YOUR terms is also good for them (provided you are actually providing solid, accurate advice).
Years ago, I had a financial advisor map out a plan for me to pay down debts and start saving money to put me in a better financial position. Being young and foolish, I hemmed and hawed, told him I didn’t have the money and attempted to “sell” him on why I couldn’t follow his plan, suggesting a much less “aggressive” approach so I could keep up my ridiculous spending habits.
The next time we met, he slid a very stern, serious-looking document across the table to me that outlined all the advice he provided me and the products he recommended, why he was recommending them and how my refusal to take his advice was foolishly putting me in a less than favorable financial position. He asked me to sign it and take complete ownership of the poor decisions I was about to make. Definitely an aggressive, belligerent and non-customer-focused move, but it was the right thing to do, and I ended up taking all his advice.
Another big area where MSPs invite abuse is in NOT standing their ground about doing business on THEIR terms when it comes to pricing and charging what they should. Nobody is going to applaud a price increase, but if you’re losing money, having to pinch every penny, cut every corner and face potential layoffs to scrape by, you are NOT being a good leader to your organization.
Great leaders have the courage to make tough decisions when necessary. To raise prices when necessary. To tell a client to go find someone cheaper. To refuse to bend on a contract. To reject giving a freebie. To NOT overlook a rude client. To draw a line in the sand when someone won’t take your advice or make the necessary investments but expects the same results.
The line of people willing to take advantage of you as a business owner is long. I say close that door and lock it.
One way to do that is by ensuring your business is attracting the right-fit clients and higher-value clients that actually value IT services and are willing to pay for them. So here’s an opportunity for you to discover how to do just that.
Join us for the Next Generation MSP Tour, coming to a city near you!
Tickets are only $19 with promo code TMTDISCOUNT. You’ll discover what the IT Industry’s most successful MSPs and IT Services Business Owners are doing to grow quickly and profitably so that you’ll have all the essentials for growing a successful business yourself.