Business

Benefits And Detriments

This month, I’ve decided to diverge from my “A Look At Subcontractors” series, which I’ll wrap up next month. For some time now, I’ve been noticing that people in our industry don’t always make good decisions. That’s troubling because, frankly, making good decisions is not only one of the secrets to success in our industry, but also one of the secrets to having a good life.

You might be asking, “So, what is a good decision?” Is a good decision one that makes you money? Maybe. Is a good decision one that closes a large deal for you? Maybe. Is a good decision one in which you tell a customer, “No. Please take your business elsewhere”? Maybe!

My secret to making good decisions comes down to B&D—benefits and detriments. I carefully look at the benefits of the decision I want to make, as well as the detriments that will (or might) occur if I make that decision. I look at the variables and the possible outcomes. Then, I make the decision and live with the consequences, whether good or bad. That process is applicable to many areas of business, as well as personal matters. If only more of us used it to make decisions. Do you?

Let’s say a lead comes in, so you go out to meet with the client. You’re looking to gather information, wants and needs, so you can develop a proposal and sell a suitable audiovisual system. Upon meeting the client, you sense a tremendous amount of hostility. That person has been burned before, and he or she plans to make you pay for it. The client wants to dictate how much money you will be able to make. The client wants to see an itemized list of every piece of equipment you plan to use and its associated cost, the installation cost, labor rates (engineering, programming and administrative), etc.

The client wants an all-the-bells-and-whistles system priced out that way, along with another system—scaled back a bit—priced out, plus pricing for another, even more basic system. And he or she also wants the associated costs for upgrading the system, all while reminding you that he or she doesn’t trust you and wants to know everything upfront. Finally, the client says he or she plans to solicit other integrators, using the same guidelines. After review, the client will go with the integrator that offers the best price. So…“What Would You Do?

Let’s follow the process laid out. What would the benefits be to proceeding? Obviously, another project would mean purchasing more equipment. That would help you make your annual quota for some manufacturers, enabling you to maintain your dealership. Doing the job would keep your team busy, even if the margins were lower than usual. And, of course, assuming you do a good job, it would mean establishing a relationship with a new client, which could mean more projects and being recommended for future work.

OK, so what are the possible detriments? For me, first and foremost is looking at the client. The apparent hostile attitude is a big red flag. I have worked a few jobs like this before. At the end of the job, you find yourself saying, “I, [your name], do solemnly swear I will never work for that client again!”

You see, for clients with a hostile attitude, it’s usually not good enough, not done soon enough and not done for the right price. They always nickel and dime you for any issues that arise, and they always blame you for any changes that have to be made that carry a cost (in time or money). In short, they never accept responsibility for anything.

In addition, if you are starting out with a lower price, your likelihood of actually being profitable on the job is slim. Then, of course, there is the associated stress with that type of client, which can have a negative effect on other projects and on your employees.

If we agree that B&D are the keys to making a good decision, what would your decision be? Does one outweigh the other? In my opinion, yes!

In this case, unless you are in sales, want the commission, and don’t care about all the issues that engineering, operations and service will have, the detriments clearly outweigh the benefits. The likelihood of the project being profitable, completed on time and without any change orders is slim. The overall impact on your team would be negative.

I would walk away from the project. In fact, I would recommend the client contact one of my competitors! That’s right—let someone else deal with them!

Even though decision-making is important work, decisions must be made decisively and in a timely manner. We all know folks who take too long to make a decision—if they ever even make one. For that reason, I have made a B&D worksheet. You’ll find it at www.soundandcommunications.com, under “Resources,” “Doug’s Docs” and “Process & Procedure.” Help your coworkers
and friends who are poor decision makers or just plain indecisive. Give them the sheet and discuss B&D with them; all of us will be better off! But this applies equally to you, the reader. The next time you’re faced with a decision, follow the process. Consider the benefits and the detriments, determine which one outweighs the other, and then go ahead and confidently make that good decision.

B&D is even more versatile than I’ve let on. Let’s say you suggest something to a coworker; as is typical of so many, he or she says no for no reason. You could respond by explaining what a possible benefit would be, and then adding, “May I ask, what would be the detriment?” And if there is no real detriment, just the possible benefit, what is the objection? You might leave the
person speechless!

One more thing, on a personal note: Please, think before you speak. If what you are about to say has no benefit, except that it will make you feel good, just keep it to yourself. Know that, by doing so, you have done your part to relieve some of the overall tension and stress we all feel due to the overwhelming amount of information and responsibility we face each day!

What do you think? Do you have any relevant decisions you made, or did not make, that you would like to share? Contact me at dkleeger@testa.com.

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