This is Part 3 of a 6 part series on transformation leadership.  In Part 1 of this series, I laid out five great New Year’s resolutions for Executives for 2013.  In this post, I offer some practical suggestions for Resolution #2: Treat your customers with more respect in 2013.

Why Customers Deserve Our Respect

I once worked with an entrepreneur who maintained a pretty simple accounting system.  He had one folder called “Money In” and a second folder called “Money Out”.  Each month, he entered all the “money in” and “money out” into an Excel spreadsheet.  When the “money out” exceeded the “money in”, he didn’t immediately start looking for ways to cut costs.  Instead, he jumped all over ways to find more customers and new orders.  While he may have been naïve in his accounting practices, he did understand something that everyone in business should understand but often forgets.  Without customers, the business cannot thrive and grow.  Without customers, there are no revenues to cover the costs.  Without customers, there simply is no business.

Despite this simple truth, some business leaders consistently and repeatedly treat customers – and prospective customers — with disrespect.  They will exaggerate product or service claims just to land a new customer.  They will propose a project with one set of resources and replace them with less qualified personnel once they receive the order.  They will take short-cuts on a project and then submit a change request to deliver the original scope.  They will fail to respond to a customer request or concern in a timely fashion – if at all.  And then they will wonder why the customer walks away from the relationship.

Now, I am not saying that there aren’t bad customers.  There are.  There are customers who try to take advantage of small businesses by pressuring them into rate reductions.  There are customers who pay late.  There are customers who will use every tactic available to avoid approving a legitimate change request.  But while the customer may not always be right, they are always the customer.  They provide the revenues that cover our costs.  They are our reason for being.  For that reason alone, they deserve our respect – even if we don’t like them much.

Here are four things you can do in 2013 to treat your customers with more respect.

Be truthful with your customers.

Being truthful begins early in the marketing and sales cycle.  Take a look at your website and your marketing and sales materials.  Are all of your claims true or have you exaggerated a bit to claim a stronger presence in a market or technology than your company deserves?  Or perhaps they were true when you created the material, but something has changed to make them less true today.  For example, maybe you have changed the product design to make it more affordable to produce, but now the product is less reliable or more prone to breakage.

If you are a service organization, take a look at your proposal process.  When is the last time you updated the boilerplate that you use in your proposals?  Does it still reflect your company and your capabilities?  Perhaps you no longer have some of the technology skills you used to feature due to employee turnover or changes in your strategic direction.

If you are chasing business outside of your traditional markets, do you truly have the capacity to deliver on your proposal commitments?  Or are you assuming you can figure it out after you get the order?  You may be able to get the first order by incorporating a few little “white lies” in the proposal, but you are unlikely to keep the customer after the first engagement once the truth is revealed.

Being truthful is the first step in treating your customers with more respect. And your customers will respond by treating you and your company with more respect.

Perform as if you will never get another change request.

In my first post, I posed a question similar to this:

Have you ever hurried through a project in order to meet a deadline, taking shortcuts that you knew you would have to fix later?

 If you answered yes, you would not be alone.  Service companies, like management consultants, engineering firms, and system integrators, all face a similar set of challenges in providing services to customers.  The best of these service companies will approach each project with the idea that that the project should be completed on time and under budget with few or no change requests.  The worst will view each project as an opportunity to make a windfall profit by taking advantage of every opportunity to submit a change request.  Most fall in the middle, taking the high road when they can, and the low road when they must.  Unfortunately, the low road seldom leads to a follow-on order.  So what can you do in 2013 to take the high road more often?

The first challenge is getting a scope document that is clearly defined and understood by both the customer and the service provider.  The service company that prefers the low road is perfectly happy with a loosely defined scope.  It gives them the opportunity to interpret the requirements in such a way that they can underbid the competitors and then underperform the work.  The high road requires a great deal of communication with the customer prior to signing the contracts.  Or, in the case of a formal request for proposal (RFP) where the communication is limited, the proposer will need to clearly define the assumptions and limitations of the proposal to provide the necessary definition and tie it to the pricing. Since the high road requires more time and applied intelligence on the part of the proposer, it is tempting to take short-cuts during the proposal process.  Since these shortcuts can lead to dead-ends and detours during the project that can be very costly to both the customer and the service provider, you may want to revamp your proposal process in 2013 to place more emphasis on scope definition.

The second challenge is to staff the project with resources that are capable of performing the work in accordance with the schedule.  Sadly, the timing of project awards seldom matches the availability of the resources that need to be assigned to the project.  Service providers often face the challenge of either pulling resources off another project or acquiring new or contracted employees to fill gaps in order to fully staff a new project.  The low road alternative is to either substitute less qualified employees or delay the staffing on the project and try to compress the later part of the schedule.  Such substitutions and delays on the front end of a project are rarely recovered without convincing the customer to accept less scope or delaying the end date of the project.  You may want to review your staff allocation process and see if you can develop an approach that reduces the number of times you need to assign different resources to a new project or delay a project schedule.

The third challenge is to maintain the kind of project plans and controls that can detect and correct problems before they become change requests.  Companies that routinely and consistently deliver projects on time and on budget have well established and disciplined project management processes.  If you have not already invested in developing these processes and training your team to use them, 2013 might be the year to start.

Build your customer service processes around your customers’ needs, not yours.

To truly understand this concept, think about your own needs as a customer who has a question about a product or service.  Do you prefer to speak to a live human being or use an automated system to get help on your phone bill?  When you speak to a person, do you prefer that they be in the same time zone, speaking the same language?  How long are you willing to stay on hold?  How long do you want to wait for someone to get back to you with an answer?  How many phone calls are you willing to make before you give up?

Your customers probably want most of the same things you do.  They want to be able to reach a person who can resolve the problem quickly and with no more than one phone transfer.  They want a resolution to their issue within minutes or hours – not days or weeks.  They want to speak to someone who is knowledgeable about their company or application.  They don’t want to get into a debate about whose fault it is.  They want you to be respectful of their time.

Now take a truly objective look at your customer service processes and systems.  Were they designed with the needs of the customer in mind?  Or where they designed to suit your current staffing availability and culture?  Are your customer service representatives treating your customers with respect?  Or are they rude and impatient?  If you use a customer feedback form, is it simple enough that most customers will complete it?  Or is it so complex, that you only get feedback from the very unhappy?

Customer service processes that focus more on your needs than your customers can do more harm to your company’s reputation than good.   Take some time in 2013 to review your customer service policies and systems and make the changes needed to create a customer experience that is second to none.

Thank your customers for their business

I am sure that most of you reading this blog use a standard “Thank you for your business” at the bottom of proposals, correspondence, and invoices.  Or, you may send an annual “thank you” card at the holidays.  And this may be sufficient for most product companies or standard services like insurance.  But if you are a service company or a company that sells big-ticket items to other businesses, you may want to go further – especially if you are pursuing follow-on business with that customer.

Products or services that are big ticket or that have long selling cycles usually require the participation of a lot of people within the customer organization, beyond those that you work with directly to deliver the project.  Procurement, accounting, engineering, facilities management, and many other organizations may be involved in planning and implementing a large capital investment.  Recognizing their support and contributions directly or to their management can go a long way towards earning their support for future orders.

Pick up the phone and call the people who helped your company be successful and say thanks.  Send an email to their supervisor or manager with your thanks for their participation and support.  Post a recommendation for that person on LinkedIn — it may be far more valuable to their career than a free lunch or a golf outing.  Or schedule a meeting with the CEO or other executive sponsor with no purpose other than to say “thank you”.

With a simple “thank you”, you can demonstrate your respect for your customer and your appreciation for their business.