Staying in Touch as You Grow, or, How Not To Get Lonely at the Top

Article by:

Karla Diehl

EO Nashville

Karla Diehl, an EO Nashville member since April 2006, is President of Edison Automation, an automation solution provider to the industrial and utilities markets. Edison prides itself on its knowledgeable, innovative and service-oriented employees who serve as a knowledge base to customers. Karla’s email address is [email protected].

Once your company has more than 30 people, it’s hard to really know what’s happening with your customers, suppliers and employees. I’m responsible for the strategic direction of my company and the health of the corporate culture– so how can I possibly be an effective leader if I’m out of touch with the front lines? I’ve found that two easy tasks keep me plugged into what’s going on throughout the company and ultimately make my business stronger.

• I answer the main phone lines during department meetings or when the receptionist is out. It keeps my finger on the pulse of my company. I learn a lot about people by how they talk to my receptionist. Suppliers and customers often don’t expect the president of a multi-million dollar company to answer the phones, so it can surprise them when I introduce myself...especially if they have just been rude or demeaning to the “receptionist.” I also find it builds a lot of goodwill with my staff– they know I am not above answering the phones. I also learn who is receiving too many personal calls.

• I call our customers for outstanding money. Yes, it sounds a bit uncomfortable, but calling on my open receivables trains our customers to pay on time and often uncovers internal organization problems.

I spend one or two days each month calling on older receivables. I run a report and look at every invoice that is 45-60 days old, and then I start dialing or emailing. This ritual is cumbersome at first, but with discipline it takes less time, trains my customers to pay faster, develops a relationship with their accounts payable contact and uncovers problems I have in my product or service delivery processes.

I first call and ask if there was a problem with the invoice. Did they receive it? Did they receive the product/service? Were they pleased? Could we have done it better? Usually there are three reasons people don’t pay. The most obvious is cash flow problems–they just don’t have the money. If this is the case, you want to immediately reevaluate their credit limit and start calling them weekly to make sure you are paid first once the money comes in. The second reason is fairly simple– they did not receive the invoice. There are myriad reasons why invoices get “lost,” but the important thing is to get them the invoice so they can pay...so email or fax it ASAP. The third reason is that there is a discrepancy. It doesn’t show as received in their system, the pricing did not match their PO or someone has put a note to hold payment due to some problem, mis-shipment or planned return. Each situation is an opportunity to find a better way to tweak our system to better meet that customer’s need.

For each call, I document to whom I spoke and what I was told. If the next time I call or email them I get the same story, I know they are not shooting straight and I get a bit more direct. I can start holding orders or reducing their credit limit to get their attention.

Calling customers directly also gives me a chance to help my front-line people learn the impact of their actions. If they are never shown the back-end results of their work, they can’t know how to fix them. I see it as a quality check on our entire process: from new customer set-up through order entry, shipping and invoicing. A mistake at any point can affect the quality of service for our customers.

For my business, the results of these two activities are better cash flow, better customer and vendor relations, better employee training and, most importantly, a sense that the boss knows what is going on and understands the lives of the people on the front lines.