I’m not talking about indiscretions or extra marital affairs. I’m talking about mistakes in customer service, or missed promises, or any version of a royal…well, you know what.

As an entrepreneur you need to take care of your clients, big time. They are the lifeblood of your business after all. When you screw up (and you will at some point), here’s how you apologize and get back on track:

Say It Now

When you make a mistake, acknowledge it to your customer as soon as you identify it. If you don’t have the fix yet, tell your customer when you will be back to them with the solution.

Face Or Phone, Not Email

Mistakes can result in emotional conversations, which don’t convey well over email. Meet face to face or at least over the phone.  When we make mistakes we are impacting individuals and passive communication is not the right call. 

Details

Provide them with a detailed account of the mistake and don’t downplay it. But, don’t over dramatize it either. Stick to the facts.

Acknowledge It

Recognize that you have done some damage to your client and it may even have indirect effects that you are not aware of.

Sincere Regret

Be sincere and explain how you regret it happened.

Appreciation

Give your client appreciation for being your client and sticking with you over the years.

The Fix

Bottom line, you need to make things right. Propose a solution to your client and make sure they agree to its appropriateness. Also, be prepared to offer a form of restitution.

Bury The Hatchet

Once you resolve the problem, seek confirmation from the client that you have fixed the mistake to their complete satisfaction. Take action to ensure the mistake never happens again.

Remember this:  It is not about you, your product, or you service.  It is all about solving client issues so they can be successful.

More helpful business stories and success lessons like this can be found in the book, 15 Bedtime Stories That Keep Entrepreneurs Awake at Night.

I can’t say I know a lot about women’s footwear, besides the fact that my wife has a lot of it.

What I can say is that I respect a great idea when I see one.

New York University students Susie Levitt and Katie Shea, like many women (from what I hear), had a problem: When they had to walk around the city during work hours, high heels made their feet hurt.  From Entrepreneur:

“They were killing our feet, but we didn’t want to give them up because we aren’t the tallest people out there,” says Levitt, 22. “So we came up with the idea of emergency footwear.”

Back at  NYU for their senior year, Levitt and Shea designed a stylish, foldable black ballet flat with a carrying case that could be tucked in a handbag and pulled out when their dogs started to howl. They gave the shoes a catchy name, CitiSoles, and a reasonable price, $24.99.

Things really lined up nicely for these two entrepreneurs, who (not considering tuition) had a wealth of free help at their fingertips.  The school offered them a library for research and development.  Business professors could serve as consultants.  NYU had lawyers who would work with the students pro bono. And what school’s public relations and marketing department, knowing a couple of their own students have a brilliant business idea, wouldn’t want to promote the living heck out of it?

Sure enough, the two were able to acquire intellectual property rights for CitiSoles, formed the company, called CitySlips, began selling, and landed articles in numerous articles in various media outlets, including the New York Times and (obviously) Entrepreneur…and offshoot blog posts such as this one, of course.

How cool.

As a man, I can’t say I’d ever think to start a women’s shoe company.  The story of Levitt and Shea is not only a case of people being in the “right place at the right time,” because executing a plan like this takes smarts.  Entrepreneurship like they display is rare, and it’s not for everyone. Who knows where it will lead these women in their lives.  Heck…their lives are just beginning.

We enjoy hearing about entrepreneurial success stories.  If you have a story you’d like to share — particularly if you have overcome a business challenge or took advantage of the market like Susie Levitt and Katie Shea did, simply go to the “tell us yours” page and submit yours.  We’d love to hear from you.

I guess you could say I’ve recently been diagnosed with a rare disorder.

I call it Amish Envy.

It hit me after reading the story of Amos Miller and his business, Miller Farm.  Miller, who is Amish, is a Pennsylvania food producer whose annual sales sing to the tune of $1.8 million from less than half that in 2006.

And here’s what amazing: He’s grown his company without any of the modern conveniences that we hold so dear.

That’s right: No BlackBerry or iPhone (or basic cell phone, for that matter). No computers. No high-tech, back-end customer management software. No car, no e-mail, no texting.

And yet his farm is so busy that he’s turning down orders.  From the article in Business Week:

 …data from the U.S. Department of Agriculture suggest what an anomaly Miller Farm is.  While farming is undergoing a renaissance of sorts, with more than 300,000 new farms started from 2002 to 2007, accounting for nearly 2 million small farms, making a good living is becoming tougher. The USDA in its 2007 census said the number of small farms with $100,000 to $250,000 annual sales (its highest revenue range for small farms) declined 7%.

How can anyone grow a business, particularly in this economy, without modern technology?  As someone in the technology business who is operating a full-service IT and executive placement company, I do take comfort in the fact that my job would, literally, be impossible without gadgets and gizmos and the arsenal of logistical tools I have at my disposal. And given, Miller is running a farm, the oldest industry on the planet.

But still, modern farms use modern conveniences.  Creating a $2 million a year business with little more than a horse-and-buggy and the shirt on your back is impressive. 

But Miller has the basics, still all you need to create a sustainable enterprise: Supply and demand.  He jumped on a trend that has been popularized in by Americans in recent years: The demand for whole, nutrient-dense fruits, vegetables and meats.  He, of course, has the supply.

 ”It used to be that organic was all the rage,” says Dan Kittredge, executive director of the Real Food Campaign, which is part of advocacy group Re-Mineralize the Earth. “Now everyone has organic.” Nutrient-dense food is the new rage and gives “the advantage back” to small farmers who leverage the notion that certain foods, such as fermented vegetables, grass-fed beef, and pastured chickens, are more nutritious than conventionally produced products and may help consumers strengthen their immune systems. “There is money to be made here,” he says.

Miller earns direct revenues from attending conferences (he rents a truck and hires a non-Amish friend to drive it).  His orders come in via snail mail and a landline telephone, as he does make a concession for Alexander Graham Bell’s original.  And he ships foods FedEx (you have to give in on a few things…right?).

Miller says he doesn’t get down on working without modern conveniences.  In fact, it prevents him from growing too big and perhaps sacrificing quality. He prefers it that way, even.

 ”The city is a pretty sterile environment,” he says. “But if I did it once a month, I’d get lost, I’d forget what it’s like to get dirty.”

We enjoy hearing about entrepreneurial success stories.  If you have a story you’d like to share — particularly if you have overcome a business challenge or even more fully developed traits such as patience and determination like Amos Miller, simply go to the “tell us yours” page and submit yours.  We’d love to hear from you.

And if you’re anything like me, you need others to ensure that you are structured properly and moving in the right direction.

For me, this oversight came in the form of a board of advisors – not directors, per se, as that would mean I work for them. I don’t report to this board and have no fiduciary responsibility to them. Rather, I have people who can guide me on this journey we call entrepreneurship.

My business was growing, and the decisions I was making professionally had long-term implications that needed a second, third, or fourth opinion.  Numbers were climbing and issues were springing up that were bigger than I could solve with my home equity line of credit.  From a planning standpoint, I started to feel as though I might be losing objectivity in some of my decision making. 

But how to put together a company board? You can find all kinds of resources and how-to throughout the Web, but two quick thoughts from yours truly:

• Make sure there are people on the board who have little or no expertise in your own industry, but rather understand the building blocks of a startup or small business and have their own respective expertise.  You want advisors who can look at your business from a completely objective standpoint and give you opinions that will help your navigate the perils of growing a company.  Deep down, it doesn’t matter whether you are in retail or executive placement – like me – or any other industry.  All successful businesses are built upon the same basic principles.
• During your meetings, check the BlackBerry/iPhone/Palms at the door. No distractions.

My board is comprised of experienced executives – not stockholders, not potential clients – with whom I have a personal relationship, who can look at my numbers without emotion, who can see around corners, who can help me make sure I am leading my company in the right direction for growth and prosperity for all parties involved.

And they are compensated for their decision making. But so am I.

Here’s what they get: Pay for their time. The amount is likely trivial to them at this point in their lives, but for me it’s a significant amount of money for a four-hour meeting. It shows them that I’m serious and that I value every minute of their time.

Here’s what I get: Sometimes I leave the meeting, having known the answer beforehand and even more confident in my decisions; other times, during the course of the meeting, I realize I need to take an entirely different direction.

The advisory board offers Capital TechSearch an excellent system of checks and balances to keep us running smoothly. A board is an invaluable resource for a small business owner.

Just be sure to listen to them. A good advisor has had many sleepless nights, and combined, they probably know your company even better than you do.

This article is reprinted with permission from the American Staffing Association.  It first appeared in the ASA Membership Sections Spotlight email, December 4, 2009, edition.

Diversify Your Client Base to Discover New Opportunities
By Lindsay Estes*

With changes in the economy, new technology, and an increasingly global market, many ASA members have taken strides to diversify their business to generate broader appeal and stand out from their competitors.

“When we first started, we set out to be in a niche and intended to stay in one area,” says Douglas Firestone of Arcus. “However, over the past several years, we realized we need to diversify not only in our placement types, but in all aspects of our business.”

A natural move for many staffing firms as they seek to diversify is to delve into new sectors. For Drew Hudson of the Choice Inc., researching new sectors to operate in involved paying attention to the news. “As soon as we knew President Obama was into energy efficiency, we reached out to the U.S. Department of Energy and green associations, knowing we were going to be busy in this new arena. We even got leads from cnn.com.”

“We got stung by being captive to too few clients a number of years ago, and we have done quite a few things to diversify as a result,” says David Ingram of Capital TechSearch Inc., who also has used new government opportunities to widen his client net. “We made a rule that no more than 25% of our business comes from one single client. We have also developed a specialty of finding cleared people for government placements. This has diversified our services and helped us develop several niches.”

Location is another way that members have been diversifying their business. Firestone notes that his firm’s move to different geographic areas came about in a nontraditional manner. “We started our diversification process with our client base. These choices were not geography-specific, but we have expanded into geographic locales that are convenient for our larger clients.”

Your firm may even be able to diversify geographically without leaving the state. “While we have stayed in Texas, we have branched out across the state. We have also begun offering services that are not geographically limited, such as behavioral and skills assessments, which have been very well received,” explains Dennis James of FiStaff Inc.

Several ASA members are offering more diverse service packages to their clients. “We offer accounts receivable management, background checks, human resource support, as well as payroll process and all related governmental filings,” explains T.J. Person, CSP, of Employment Edge.

Todd Palmer of Diversified Industrial Staffing says, “We are working to build the next generation of skilled tradespeople. We developed a book to teach candidates how to find a job, and we have been working with local community colleges and universities to get in touch with people in school for work force retraining. The average American welder is 58 years old. We are going to need this younger generation, and we are working to provide them with the learning tools they need now.”

Diversification can help a staffing firm stand out from competitors—whether you broaden your business by acquiring new clients, offering new services, or attracting previously untapped talent.

“Diversity is just how it is supposed to be,” says Firestone. “I made a commitment to diversity on all levels, including in my own employees. This is the differentiator in my mind between us and the people down the street.”

*Lindsay Estes is the ASA sections assistant.

About the ASA

The American Staffing Association promotes legal, ethical, and professional practices for the $86 billion U.S. staffing industry. ASA members account for 85% of U.S. staffing industry sales and operate more than 15,000 offices throughout the nation. Some 2.7 million Americans go to work for U.S. staffing companies every business day.

Founded to promote flexible employment opportunities and ensure the quality of staffing services, ASA has been the voice of the U.S. staffing industry since 1966. Members provide a wide range of employment services and solutions, including temporary and contract staffing, recruiting and permanent placement, outplacement and outsourcing, training, and human resource consulting. ASA and its affiliated chapters promote the interests of the industry through legal and legislative advocacy, public relations, education, and the establishment of high standards of ethical conduct.

For more information about the American Staffing Association or membership, please visit their website at AmericanStaffing.net.  Capital TechSearch is an ASA member.

Don’t know about you, but I am certainly ready for 2010 to start.  2009 has been one of the most challenging times I have seen professionally.  I saw some indicators in 2008 that this was going to be a tough year but holy cow.  What does not kill us makes us stronger, right?  I did have an experience the other day that I allayed some of my tension and it reminded me of why we do what we do, so I’d like to share that story with you.

I was meeting a close friend of mine who owns a local company and he was relaying an unexpected occurrence that he had dealt with that particular day.  No wonder he wanted to meet for a beer. 

Apparently there was some kind of accounting error that required him to write a very big check that day.  Given the time of the year, I am sure this is not the only big check that he was writing like estimated taxes, renewal of licenses, and all the other stuff that just hits at the end of the year whether you want to or not. 

Long story short, someone else in his organization had the responsibility to ensure the accounting was right and that person was flipping out over the error.  Completely distraught.  We entrepreneurs know that no matter what the mistake is, we still have to write the check whether we like it or not.  Our mistake, their mistake, it is always our check. 

What my friend told me next was truly enlightening.  He said that he sat with the person who bore the responsibility of accuracy(by the way, this person is key to his organization both now and for the future). 

He told him this: “There will be a day in the future when you have achieved success and wealth and someone will look at you and say ‘it must be nice.’  That person will never have had a day like today.” 

To steal and modify a phrase from a song in one of the sitcoms I used to watch growing up:  “We take the good, we take the bad and there we have the facts of (life) business ownership/entrepreneurship.”

For more real-life entrepreneur stories, check out my book, 15 Bedtime Stories That Keep Entrepreneurs Awake at Night.  This story will surely make the next edition.

Anna Farmery, host of The Engaging Brand show and blog, interviewed author David Ingram recently on the topic of “how to succeed as an entrepreneur,” based on his book 15 Bedtime Stories That Keep Entrepreneurs Awake at Night. 

In the interview, Ingram — President and CEO of Capital TechSearch — gives his thoughts about a number of topics he learned while building his business that would be helpful to an entrepreneur or small business owner such as:

• How to fight boredom as an entrepreneur
• How to make work more interesting
• Don’t isolate yourself in the business
• The importance of mentoring
• Is starting a business risky or is it risk averse?
• The difference between cost and value when deciding on bringing in outside experts to the business
• Why you should view suppliers as external employees
• Learnings on how to manage talent
• How to grow as a leader when talent leaves the business
• When to say no to a customer 
• The importance of searching for weakness in the business
• The importance of charitable giving

 You can listen to The Engaging Brand podcast, show #274, below:

For additional tips and stories that will help you as an entrepreneur sleep better at night, you can purchase David’s book — 15 Bedtime Stories That Keep Entrepreneurs Awake at Night — either on this site or through any one of your favorite booksellers.

Enjoy the interview.

If there’s one businessman who deserved to be kept up for a night (besides Mr. Madoff), it was Ebenezer Scrooge.  A greedy man who ran a company and kept every dime for himself, and gave nothing back. And then, in one long night, he found his redemption.

If there’s one aspect of Capital TechSearch that I personally don’t lose sleep over, it’s when it comes to charitable giving.  And as a small business owner, you shouldn’t be kept up at night over it, either.

There’s no doubt about it: Giving in a tight economy, particularly during the holidays, is a water and oil-like combination. The Conference Board reported this year that 45 percent of corporations – my gosh, nearly half –are expected to decrease charitable donations this year.  And as a report from CFRE International notes:

A 2001 Giving USA report on charitable donations found that after an economic downturn, charitable giving typically does not keep up with increases in inflation. Upon revisiting the subject in 2008, it was found that giving slows slightly during recessions. In the five recessions since the one between 1973-1975, giving fell an average of 1.3 percent adjusted for inflation. In non-recession years from 1966 through 2006, giving has increased an inflation-adjusted average of 4.3 percent.

So how does a business continue recession-time charity? 

Community giving as a business is akin to, as an employee, sticking a portion of your paycheck into a retirement plan: Establish a percentage up-front to give, and do so automatically. It’s hugely important and will make you feel good, and you’ll never really notice you had the money anyway.

Take the retailer Target, for instance.  There, 5 cents of every $1 earned goes back into the communities it serves.  And do you think Walmart got as big as it is and enters the communities it does without giving back?  We’re talking hundreds of millions of dollars that are pumped back into the counties and cities where world’s largest company operates, and to numerous education, healthcare and initiatives.

Our business obviously can’t give what Walmart can, but five years ago, I decided to make charitable giving a core part of our business culture.  While training for a marathon, I met the manager of a local nonprofit, Comfort Zone Camp, which supports the emotional needs of children who have lost parents, siblings or primary caregivers.  When I gained an understanding of what this organization did, our company began sponsoring a gala and invited our network of friends and associates.  I was into it.  Our employees were into it.  We bonded as a team as we built our company’s greater good.  We’ve since added numerous other needy nonprofits to our list of donorees, if that’s even a word (let’s just go with it).

My business now gives more than 7.5 percent of our net profits to local charitable groups, and we have committed to at least that amount through the good times and bad.

Small business success means looking beyond the bottom line.  Earning a reputation as a giver is the best thing a business can do for itself…and who knows where new relationships – be they the best employees or new, honorable customers – will crop up because of it.    

Take it from me, or better yet, take it from Scrooge: You don’t want to be visited by his late-night guests.

Here are some questions for reflection in your own business:

• How important is your business to the community?
• Who drives community involvement in your firm? Are you aware of anyone in the company who is actively involved with a nonprofit?
• What are some local organizations that could benefit from your company’s contributions?
• What are some benefits of community involvement, both on a personal level and on the whole?
• How do you envision your company’s place within the community in 10 years?

This post is the first in a two-part series on charitable giving. Look for a future post about how entrepreneurs as a whole make up a high percentage of charitable donations.  And for the full bedtime story on how to not be a Scrooge, read Chapter 11 of 15 Bedtime Stories that Keep Entrepreneurs Awake at Night.  You’ll definitely sleep better at night knowing you are making a difference in your community and your business.

If you don’t have integrity, you have nothing. You can’t buy it. You can have all the money in the world, but if you are not a moral and ethical person, you really have nothing. – Henry Kravis

When I started Capital TechSearch, the dot-coms had crashed and the world witnessed some of the most stunning instances of corporate fraud ever recorded.  We saw WorldCom and Enron and the numerous others like them crash because of their leaders’ greed and lack of integrity.  And then last year we watched it all happen again – this time, because of pure and stupidity – as major banks crumbled and innocent bystanders lost millions because of it. 

If you have no morals or ethics, you have no business being a business owner.  The problem with that concept is that you’ll come across very few people who will admit that they have no morals or ethics.  In fact, most people will readily cast themselves as individuals with high moral regard (“Moregard”?  Did I just create a word?). 

This is why your reputation from third party sources is the biggest selling point you have for yourself.  It’s why social-networking Web sites such as LinkedIn offer recommendations from others.  Without your reputation and referrals from others, you may still have a way to make lots of money, but if no one can look at you as a genuinely good person, well then – as business financier Henry Kravis says – you’d still have nothing. 

And should you “Pull an Enron” on any level, large or small…if you lose your integrity, there’s no “Lost and Found” for that.  It’s one of the hardest things to get back.

Are you ethical?  It’s a hard question to ask yourself, but you need to dig deep and try and view yourself as others would – that is, in the most honest light possible. Few people – if any – will say they are unethical or have no moral fortitude. But we all know that these kinds of – as they say in Animal House, “morally casual” – people are out there.

Your business ethics will be tested throughout your journey as an entrepreneur, and the way in which you react to situations and problems will determine your reputation as a company. It’s important to set your standards from the start.

First, let’s examine the basis of being an ethical leader.  Take this description from the Institute for Ethical Leadership:

The ethical leader understands that positive relationships are the gold standard for all organizational effort. Good quality relationships built on respect and trust—not necessarily agreement, because people need to spark off each other—are the single most important determinant of organizational success. The ethical leader understands that these kinds of relationships germinate and grow in the deep rich soil of fundamental principles: trust, respect, integrity, honesty, fairness, equity, justice and compassion. Stephen Covey calls such principles the “laws of the universe.” The ethical leader knows that by acting in accordance with these laws, living in harmony with these basic principles, human enterprise flourishes and is sustained.

Early last century the German philosopher and theologian, Martin Buber, described these successful relationships as “I-Thou” relationships, in which people recognize the intrinsic worth and value of others and treat each other with sincerity and respect. In the language of the 18th century German philosopher, Immanuel Kant, this is the principle of always treating the other person as an end and never merely as a means to serve your own personal interests. The ethical leader moves and acts in a world of I-Thou relationships, where in any situation, to the fullest extent possible in the circumstances, the intent is to honor and respect the worth of the other person.

In this way the ethical leader embraces the act of service as described by Robert Greenleaf in his concept of “servant leadership.” The effective leader acts as a servant to others engaged in the enterprise, not in any sense of inferiority, but as one who empowers others to achieve success by focusing on right action. The ethical leader understands the truth of our interconnectedness to each other, and that it is through our willingness to serve each other that we release our combined energy and potential to benefit the greater good of which we are all a part.

Second, here are 6 tips to build and maintain an ethical company:

1. Actions speak louder than words. While it’s important for your employees to understand your company’s rep as an ethical firm, make sure that reputation – as well as your community-giving activities – don’t wallow behind the scenes. It may sound (somewhat) self-serving, but you should make sure your actions are visible to customers, who have the final say in your small business’ reputation and overall perception. They’re the ones giving referrals, and knowing you sail an honest ship is of utmost importance. Announce your corporate-giving activities in news releases. Post them on your Web site or Twitter page. Mount banners or certificates from your supported charities inside your office, like we do in the Capital TechSearch board room. Heck, even go as far as pointing them out to clients when they visit. If your clients are ethical too, they’ll give you credit where due.
2. Ethics must start at the top. You set the bar for work ethic and moral ethic at your company. Don’t work hard? Neither will your employees. Moral standards questionable? Your employees will either knowingly follow, or leave the business (if they know better).
3. Always keep your door open. Establish an office environment where employees can voice concerns, including issues with company policy, without fear of recrimination. We see examples every day where people blow the whistle – ahem, Enron anyone? – but no one should have to resort to that.
4. Don’t assume employees know “right” and “wrong.” Clearly communicate from the beginning how you expect them to behave when it comes to internal work and dealing with clients. Set and manage these expectations.
5. Make sure you reward people on the basis of exhibiting company values. Be it money (good) or a burrito (dare I say better?)
6. Deal decisively and immediately with breaches in conduct. It is important to make sure you know the whole, two-sided story before you confront unacceptable ethical behavior.

To evaluate your own, you can take this ethics test, sponsored by the Cass Business School at City University London, PriceWaterhouseCoopers, and the The Times of London.

Want to know what companies are the world’s most ethical? Get the list from the EthiSphere Institute, a research-based think-tank dedicated to the sharing of best practices in business ethics. Scroll to the bottom of the page for small case studies on why a few of the selected companies made the list.

Most importantly, don’t ever compromize your ethics.  For a Bedtime Story on the business lessons we learned about not compromizing your ethics, read Chapter 5 of 15 Bedtime Stories That Keep Entrepreneurs Awake at Night.  And, remember, if you ever have any doubt on what to do in a situation, always take the high road for lasting success.