Everyone in business knows the importance of a customer. They are the ones that write us checks and keep the doors open. They are the ones that see the value in what we provide. They are the ones with the biggest voice in the market today with the freedom of the Internet and Social Media. They are the lifeblood of every business.
Unfortunately, not everything always goes well with all our customers. Sometimes we don’t keep our promises and we don’t deliver the value they are expecting. Sometimes the way we treated them just isn’t what they expected. Sometimes, their expectations don’t match our expectations and they become unhappy.
For the most part we can usually deal with these issues and get them resolved quickly and to the customers satisfaction. But there are other times when we can’t. And when we can’t, they may choose to leave and do business elsewhere. And depending on how severe they think we wronged them, they may file a lawsuit. This is where things can go from bad to worse if not preempted and not contained.
Timing is everything…
Often times when a business is sued for some reason, the owner or leadership team feels they can resolve the issue and “get past it” with the customer. They invest many hours (both themselves and their employees) to try and get the issue resolved. While this may work some of the time, it generally is just wasted time and the customer is still not happy and continues with a lawsuit against the company.
We have found that most leaders call their lawyer later than they should have…they think they can resolve it and they can’t. The problem has escalated and could have possibly been contained with early involvement by the lawyer. Waiting too long to get legal advice can cost an organization significantly more time and money than if they had involved their lawyer from the beginning.
When you think about it, if the lawyer was involved early and the problem could be resolved with minimal efforts, the cost has been kept to a minimum. The additional fees paid to the lawyer could have possibly been avoided if the company could resolve it right away. But what if the problem escalates and the lawyer has to get involved when the situation is significantly worse. Now the fees go up quite rapidly because there is not just the issue but the time factor has been shortened. Everything escalates when waiting too long.
Emotions are always a factor
When company leadership tries to resolve the issue, one thing definitely can’t be eliminated or ignored…the emotional side of the issue. Both the customer and the leadership team are emotionally charged with the issue…each one having very specific opinions about what is right and wrong. When emotions are involved, it is much harder to separate the facts because now it has become “personal” to both parties. When this happens, the odds of an amicable resolution go down with each passing day.
One of the values of getting your lawyer involved in the beginning is their ability to take the emotions out of the discussion and focus on the issues…for both sides. They can help act as a mediator for both sides…allowing each one to see the others perspective on the situation. This objectivity can go a long way in helping to resolve issues before they escalate into something well beyond the initial problem. Calm minds and discussions always lead to better solutions.
Know your options early
Regardless of the customer issue, understanding what options are available to both sides is critically important in the resolution process. Often times the best case may be to just settle it and agree to disagree rather than pursue it just because you feel you are right. Knowing what these options look like early on can be a great way to resolve the issue and remove the emotion.
Winning can still mean losing
Even if you are right and the customer is wrong, winning can still mean losing. You might have proven the customer wrong and pushed the issue to a point of wearing down the customer so they cave in and just drop the suit. While you might have won the day, you potentially could be losing much more. Customers talk…a lot. They are happy to tell their thousand plus friends what a bad company you are to work with and to never purchase anything from you. Winning one situation could cost you the potential of many more customers in the future…and you won’t even know why.
Best solution is anticipation
The best solution to avoiding law suits is to be proactive and anticipate things that can go wrong. When you understand some of the potential issues that could happen, you can spend the time upfront trying to eliminate them or how you can handle them well before they come to fruition. The best defense in this situation is anticipating what could go wrong and planning accordingly. Focus on potential solutions well before the issues happen. And if they don’t happen, you have probably created a discipline of eliminating other issues from happening.
While we get involved with organizations to help them avoid and eliminate lawsuits, sometimes they just happen. Get your lawyer involved early so you can fully understand your legal alternatives and some additional suggestions on how to proceed. As someone who has been a litigator in the past, I can tell you that many times litigation could be avoided if clear and rational minds were involved in the discussions early into the situation. Don’t spend money you don’t need to spend on lawsuits that could be resolved and eliminated before they get out of control.
Call your lawyer immediately…
As soon as you think there could be a potential problem…before the problem turns into a lawsuit…call you lawyer. Give them a heads up that this could be happening and start to get their advice. When dealt with early, they should be able to give you insights that could help you to avoid the lawsuit altogether. If you ever have any questions about a potential law suit or any other aspect of your business, just ask and we’ll be happy to answer them.
Or if you want to better understand how you can minimize and lower your risks (which every business owner wants) then please read some more about risk management and how you can help determine your own risk. I’d also be happy to meet with you (complimentary of course) to discuss your own personal situation further and give you some insights about how you might want to proceed.
I hope you have found this helpful and given you a different way to look at your business. If it has, please share this with others inside your company and your colleagues who are running or leading other businesses. Our primary mission at Generations Law Group, LLP is to help everyone find productive ways to lower their business AND personal risk. This is just one way you can start to do this…but it will tell you a lot about you and what has happened over the past few years with regard to your business risk. Let’s make sure your risk is as low as it can be while you continue to grow.
