A trap many big companies fall into is losing touch with their customers.  Many executives never talk to customers directly, only learning through statistics and demographics.  As a result, they often make decisions to treat their customers like numbers, not human beings.  Customers dread calling into these sorts of companies, like AOL.

Small businesses have the advantage that the owners and decision-makers are often forced to be on the front lines dealing with customers.  This helps in gaining a deep understanding of what customers want.  In fact, I often prefer buying from small businesses because they usually have a more personal touch.  Ironically, as the business prospers, the folks in charge often throw away this connection with customers by hiring poorly-paid customer service people.

It doesn’t have to be like this.  Some big companies, like Nordstrom, are famous for their customer service.  The key is growing your company intelligently.

Make sure all the decision makers in your company spend at least some time keeping in touch directly with customers by doing customer service, taking orders, or making some calls.  This will help them understand how your offerings can be improved.  They’ll get to hear problems and suggestions right from the customers.  Or if customers are confused, they can think about how to tweak the product or information to clarify.  It’s also an incredible motivational boost when they know exactly whom their work will help.

It may be humbling, and you might hear some complaints that they don’t have time for it, but you can’t afford to let the business be run by people who don’t know your customers inside out.

Business owners need to make a lot of decisions on a daily basis.  They range from small ones such as whether to do a questionable refund or not, to big ones such as how much money should they allocate for marketing.  For small business owners, it might be difficult to make the right call when these decisions are tightly tied to their own personal finances.  This is especially bad when the owners are faced with influential emotions like greed, stress, and pressure.

The easy way out is to maximize short-term profit in those situations.  Questionable refunds?  Just keep their money.  Marketing budget?  As little as we can afford.  Hiring for talent?  Just tell the current staff to do more.

When these situations are laid out on paper, most people are able to make a good decision that balances both the short-term gain and the long-term benefits.  The tricky thing is to make a good call under stressful circumstances.

Here are a few tricks that might help you in those situations:

1)  Stay calm. Try to detach yourself from any negative emotions so that you can make a more rational decision.

2)  Get away for a while. Remove yourself from the environment, even for just 5 minutes.  This can help clear your head.

3)  Remind yourself of what’s important. Your beliefs in the fundamentals such as integrity, customer satisfaction, etc. can help you get over greed and pressure.

4)  Set a policy. Make one good, level-headed decision so that you don’t need to think about it every time.

Do you have any stories to share where you had to make a tough business decision under pressure?  How did you handle it?

Nobody is right all the time.  Albert Einstein said, “Anyone who has never made a mistake has never tried anything new.”  For important business decisions, the consequences of a major mistake can be costly.  A leader needs to form a safety net by encouraging colleagues to point out mistakes early on.

This is not easy.  Have you seen an insecure or hot-tempered authority figure get annoyed when challenged?  So has everybody else, and this makes people less likely to risk their boss’ wrath by speaking up.  Furthermore, pressure to go along with the group can make it hard for people to speak up, even when they’re obviously right.

What can you do to encourage a culture where people will feel comfortable speaking up?
- Set an example by regularly asking hard questions.
- Ask people what they think, especially when they look uneasy.
- Thank people when they speak up, even if you disagree.
- Take some breaks between having discussions and making decisions.  This will give people time to think and put their objections into words.
- Set up an anonymous suggestion box.
- Mention times when you have changed your mind or been mistaken.  You will gain more respect by showing your honesty and open-mindedness than by pretending to be infallible.

It takes a certain strength of mind - humility - to truly appreciate criticism.  This strength can’t be faked, but it can be trained.  Start forming your safety net now by talking to your colleagues and sharing this article.