We often assume that no news is good news and just because customers are paying their invoices, they are happy.  This can be a dangerous assumption.  Customer service has to be planned.  You can’t just leave it to chance.  Here are some suggestions for implementing a customer service strategy that may work for your business:

• Define a goal for customer service – You should have written goals for customer retention, repeat business, and referrals.  But you should also clearly articulate how you want customers to feel about your service.  What is the customer experience you want to deliver?  What expectations do the customers have?  How will you meet or exceed them?  Get your team involved to brainstorm ways to increase customer satisfaction.  Plan account activity with your team, including how often you will meet with customers to discuss satisfaction.

• Define a process and follow it – Consistency is not an accident.  Involve your team since they will ultimately own the process.  Make sure you don’t just focus on “what” you will do and “how” you will do it.  The most important element, and the one most companies leave out, is “why” you do it.  While you’re at it, go ahead and include “who”, “when”, and “where”!

• Educate your customer – You are an expert in your field, but your customers and prospective customers are not.  That’s why they hire you.  From your very first interaction, you have to put them at ease, help them articulate their needs, and to feel comfortable that they are in good hands.  You need to explain what it will be like to work with you and to set appropriate expectations of who will do what when.  I have a client who gives new customers a flowchart labeled “What to expect when working with our firm”.

• Hold regular check-ups with the customer – Plan them, especially if your service is on-going. Don’t just ask questions.  Interview them and show them you care.  Always try to find something to improve.  If your product or service is normally delivered by your staff, this is a good opportunity to maintain personal contact so if your employee leaves, the customer doesn’t leave, too!  This is also an opportunity to sell additional services and ask for referrals!

• Conduct a post-engagement review – This is especially important if your work is transactional or project-based.  What went well with the project and what should be done differently next time?  Meet with your staff first to get their perspective before you meet the client.  This process is especially important when you lose a client.  You can use surveys for these reviews, but I recommend a meeting or at least a phone call.  The truth is sometimes painful to hear, but it can be even more painful to not hear it.  A special touch is to send a thank-you note for their honesty and for having done business with you.

Once you have a strategy for managing customer service, market it.  Most companies do not take a strategic view of customer service, so make it a point of differentiation.  Highlight your process in your marketing materials.  Remember: Satisfied customers stay with you, but extremely satisfied customers become advocates and give you referrals.  And never take “yes” for an answer!

This tempting offer was made because Floyd’s had been picked as the first-ever Google Offers “deal.” Google Offers is the company’s first baby step into the world of “social buying” style promotions where a special, limited time offer is made by a business hoping that the deal will spread virally and thereby introduce a new legion of customers to their business.

Google, of course, did not invent the deal-of-the-day category; they were goaded into it after their generous $6 billion dollar offer to buy Groupon was turned down.

Now Groupon is starting to feel the pinch after thumbing their nose at one of the world’s most valuable companies. According to compete.com, Groupon’s traffic went from 33.7 million unique visitors in June 2011 to just 18.3 million unique visitors in January 2012. That’s a drop of almost half inside less than a year. Not surprisingly, Groupon’s stock is also down around 25% since its IPO last year.

Over-playing your hand

The moral of the story is to be careful not to over-play your hand when being approached by someone who wants to buy your company. Acquirers usually have deep pockets and, while you may think your business is unique, never underestimate the resolve of a big company with lots of cash.

They do have an alternative to buying you: they can simply compete with you.

Typically when they make the decision to walk away from the negotiation table they do not leave empty-handed. They come away with new-found insight on how you run your business, what works, and what flops; so they have an enormous head start to launch a competitive company.

And it doesn’t just happen in Silicon Valley. Take a hypothetical example of a home security company generating $500,000 per year in profit (before tax) installing and monitoring home alarms. One day a big alarm company comes along and says they want to buy the business and they’re willing to pay four times pre tax profit. The alarm company owner turns up his nose and demands six times earnings.

Now the suitor has a choice. They can try and negotiate with the owner, but that would undermine the economics of the model they’ve used to buy hundreds of similar alarm companies across the country, or they can simply hire someone to start an office to compete with him.

Let’s say they pick door number two and hire a young, aggressive manager. They guarantee her $200,000 a year in the first 12 months on the job while she is building her business. You have not only lost the opportunity to sell your business; you’re now competing against a young, motivated rival with a parent company who has an extra $1,800,000 ($2,000,000 withdrawn offer minus the $200,000/ year salary for their manager) that they didn’t use to buy you and they’re putting it towards helping your new competitor build her business.

If you’re lucky enough to get approached by a big company who wants to buy yours, remember that they are usually not choosing between buying you or buying your competitor. They are often choosing between buying you or setting up shop to compete with you.

If you think this pie-in-the-sky thinking only applies to large companies, think again. When creditors evaluate your company, the largest consideration is whether your future cash flows will allow you pay them back. Likewise, when a potential acquirer looks at your business they are interested in the future earnings or, more specifically, future cash flow. If you cannot show them how the business will generate profits and free cash flow in the future, they will not value your business as much.

I realize that the leaders of small and mid-sized business cannot spend all of their time in the future – you do, after all, have to deliver your product or service to your existing customers in the present. But you should spend at least some of your time living in the future. Here are several strategies to try:

• Stare out the window – The first step in creating a future is to imagine it. Set aside a few minutes every day or a few hours every week to take your mind off the day-to-day activities and spend that time thinking about the future. This can be as simple as closing your door and staring out the window. Other options are taking a short walk or going to a coffee shop for a leisurely beverage.
• Set aside some “cave time” – Find a place and time where you can “get away from it all” for a while. I have a client who goes to a café one morning every week. She arrives when they open and stays until the lunch crowd starts arriving around 11:30. She tips the waiters well and they know to keep the coffee warm and the distractions to a minimum. Another client spends one morning each week working in his home office, away from phone calls and interruptions. Another spends an afternoon each week with a glass of wine and his thoughts. It doesn’t matter where you go, but it should be away from the office.
• Hire a business coach – A business coach’s main job is to help you develop a vision for your future and to put some structured thought into how you will achieve it. This, by definition, requires you to spend time in the future. This works especially well for folks who do their best thinking conversationally rather than sitting alone in their cave.
• Join a peer advisory group – Spending time with other business owners can be a very effective way to spend time thinking about the future. You are there to stimulate the other business owners and they are there to stimulate you. At our meetings of The Alternative Board it is common for the members to say that their key take-away came while discussing someone else’s business. Often, just being around other successful business owners is enough to get ideas flowing!
•  Develop one or more seconds-in-command – As you spend more time in the future, someone will have to step up and take more responsibility for the day-to-day activities.  Larry Linne wrote an excellent book called “Make the Noise Go Away” which defines all the daily distractions as “noise”. If someone makes your “noise” go away, you will have more time to focus on the future.

I personally use a combination of these tactics. I leave the office every day to go home to walk the dog. I spend a half day away from the office every two weeks and spend a week away every quarter. Even though I am a business coach, I have a business coach (it is difficult for the physician to heal himself!) and I try to outsource or automate as much of my administrative activities as possible. Regardless of what works for you, the more time you spend living in the future the more your business is worth.

Like your house, your business projects an image to potential buyers. When they come to see your business for the first time, your “curb appeal” can attract a buyer to your business—or cause them to walk away from it.

Do you need to improve your curb appeal? Here’s a three-step plan:

1. Fix Your Leaky Faucets

 Perhaps, like many other business owners, you started your business from scratch with one or two employees and now you have 20 people working for you. But do you have the appropriate HR infrastructure in place for that size of a company? Perhaps you even take pride in your informal management style, but it can prove to be a liability when it comes time to sell.

Make sure your human resources policies are at least as stringent as those of the company you hope will buy your business. Some basics to have in place:

• A written policy making it clear you forbid any form of harassment or discrimination
• A written letter of employment for each staff member
• A written description of your bonus system
• Written policies for employee expenses, travel and benefits

2. Assemble Your Binder

When you go to buy a house, it will give you confidence if the owner has the instruction manuals for the appliances, information on where they were purchased, and who to call if one of them breaks down.

Similarly, when a potential buyer looks at your company, he wants to see that you have your business information in order. Documenting your office procedures, core processes, and other intellectual capital can help you attract more bidders and a higher price for your company, while also lowering the chance of the deal falling apart during diligence.

If you want to attract a buyer one day, your business needs a binder with instructions for basic functions, such as:

• Opening up in the morning and closing down at night
• Forms and step-by-step instructions for routine tasks
• Templates for key documents
• Emergency numbers for service providers
• Billing procedures for customers
• How your company is positioned in the market and your marketing tools

3. Document Your Intangibles

Intangibles for house buying might include: Is the house near a good school or daycare? What kind of neighborhood is it? What kind of commute are you looking at to get to work?

Your business also has intangible, often intellectual, assets that a potential buyer needs to be made aware of, such as:

• Proprietary research you’ve conducted
• A formula for acquiring new customers
• Criteria you use to evaluate a potential new location
• Your unique approach to satisfying a customer

As with selling a house, your company’s curb appeal can go a long way toward closing a deal.

What do I mean by bad hires, and how do we avoid them? As a business owner, it makes sense that you want to hire the best and brightest talent available, but we often settle for employees that aren’t quite the best and brightest. Or maybe they have stellar credentials, but it turns out they aren’t a good fit with the rest of our team.

The employees with the strongest capabilities and a good cultural fit are superstars — they produce good results and everyone likes them. We want to clone them.

In the opposite corner are those who turn out to be lacking in capabilities and who don’t fit well with the rest of the team. It doesn’t take long to recognize these failures, and it is usually pretty easy to take quick action to eliminate them.

But what about the rest?

The disrupters are those who are very good at what they do, but don’t fit well with the organization. We may hang on to them because they produce results, but they wreak havoc on other employees, customers, suppliers and cause us stress.

The plodders, on the other hand, may not be the most productive members of the team, but everyone really likes them, gosh darn it.

It makes sense that we want to hire superstars and avoid failures, but why is it that so many of us end up with a bunch of disrupters and plodders? The answer may lie in our hiring process.

Let’s start with timing. Most of us put off hiring additional staff until we really, really need them. That’s too late.

We should constantly be on the lookout for superstars and hire them when we come across them. If they are truly superstars, they will more than pay for themselves in a short period of time. If we wait until it is too late, we rush through the hiring process and view “any warm body” as better than “nobody.” We end up with disrupters, plodders, or worse — failures.

Second, do we really know what we are looking for? I know it sounds mundane to write a job description, but we must take the time to clearly define the position so we can better screen the resumés, define the questions to ask in the interviews — you are writing down the questions prior to the interview, aren’t you? — decide who in our organization needs to meet with the applicants and define the criteria to decide between multiple candidates.

Thirdly, we need to set our sights high. I’ve heard many small-business owners lament that they must compete with large corporations for talent and they just can’t match the salary, benefits and career opportunities the larger firms provide.

That may be an issue for some portion of candidates, but in survey after survey we learn that many of these tangibles are less important to high performers than some of the intangibles.

Daniel Pink (you can see him speak at ted.com) argues that the principal motivators for high performance are autonomy, mastery and purpose. In a smaller firm, we can certainly offer much more autonomy, a broader set of responsibilities and a stronger alignment to vision and mission than most employees have in larger organizations. High performers love those benefits, and we should highlight them in our recruiting.

Finally, we tend to hire for knowledge and experience and forget about the importance of cultural fit. It is imperative that the new employee meshes well with the team. You need to meet late-stage candidates multiple times to really get to know them beyond what is on the resumé. Candidates should meet with multiple members of the team just like they would in larger organizations.

I would also encourage “test driving” the prospective employee in various situations, like take them to lunch, meet them for happy hour or some other activity. Knowing how they make decisions, how they treat others, how they conduct themselves and just whether you like hanging out with them — you will be spending a lot of time with them if you hire them — is just as important as knowing their experience and skills.

If you follow these guidelines, I can’t guarantee you will hire only superstars, but maybe you can avoid failures altogether and have fewer disrupters and plodders hanging around.

Westminster, Colo, Sept. 19, 2011– The Alternative Board® (TAB), an exclusive membership-based organization that provides advisory boards and coaching services to business owners, announced today that the company has been selected as one of four partners for Startup America’s Mentorship program.

The Startup America Partnership was launched at the White House in response to President Obama’s call to celebrate, inspire, and accelerate high-growth entrepreneurship throughout the nation. The Partnership is bringing together an alliance of major corporations, funders, service providers, mentors and advisors working to dramatically increase the prevalence and success of high-growth enterprises in the U.S. AOL co-founder Steve Case chairs the Partnership and the Kauffman and Case Foundations are founding partners. The Partnership will identify, measure and report on the effectiveness of cross-sector collaboration in support of entrepreneurial ventures and its effect on job creation and growth.

“It is truly an honor for TAB to be selected as a partner with Startup America,” said Jason Zickerman, president and CEO of The Alternative Board. “We are committed to providing expert advice for these young companies through the services that our facilitators/coaches provide. We are very excited to have an impact on the success of these companies.”

TAB offers innovative and proven solutions for businesses to become more productive and profitable. The TAB Board, led by a TAB-certified facilitator/coach, meets to solve problems, share seasoned advice and provide peers with results-driven strategic solutions. In addition to monthly board meetings, members receive private, monthly coaching sessions from the facilitator.