Change is a double-edged sword for all businesses. New technology, growing markets and regulatory overhauls can all create new markets and cost-saving opportunities for entrepreneurs. However, they create their share of complications as well. Smart leaders must be prepared to deal with this change.
One of the biggest challenges is living up to customer expectations in an evolving environment. Customers may have a difficult time hearing that you will no longer be able to live up to your end of the contract due to recent events outside your control. On the other hand, advances in technology and more lenient regulations may cause them to develop unreasonable expectations.
How do you manage customer expectations in a changing industry? Here are some thoughts to consider.
Don’t assume everything is outside your control
It is easy to blame stricter regulations or growing competition for your inability to serve your customers. However, you may still be able to meet customer expectations.
You need to be realistic about the complications that these changes create. Try to find a way to live up to your obligations, in spite of these changes.
A few years ago, I was a project manager for a large Internet marketing agency. This company helped its customers improve their search engine rankings with Google. Unfortunately, a couple of changes adversely affected their ability to serve their clients:
- Google began penalizing companies with low-quality content more than ever.
- A number of third-party platforms that helped companies improve their search engine rankings were removed from the search engine rankings.
- Many publishers that the company worked with were more hesitant to assist them due to concerns that Google would continue to penalize sites like theirs.
Initially, it seemed that the company would no longer be able to live up to the promises they made their customers. Then we discovered some other ways to address these challenges. They began shifting towards a PR-based content marketing strategy, which proved to be even more effective.
Sometimes it is impossible to adapt to new standards, but there is usually a solution if you look hard enough.
Cut costs where you can without breaking contracts
You need to prioritize the terms of your contract over anything else. If changes in the market force your hand, you may need to cut back on unwritten promises so that you aren’t in breach of contract.
An example can be seen with my friend’s rental agency in Northern California. The City Council passed a new rent control law that prohibited him from raising rents over 10% in a given year. This meant that his costs for property taxes and insurance were rising faster than he could raise prices. He needed to look for ways to cut costs to maintain a decent profit margin.
Many of the services his agency considered were already guaranteed in the rental agreement with his tenants. He couldn’t change them until all of his tenants’ rental agreements expired, so he needed to find other ways to cut costs. Fortunately, there were plenty of opportunities to take advantage of. You can always negotiate different contract terms after the old ones expire.
Have candid discussions with customers about future expectations
New technology and other opportunities are a boon to both companies and customers. Unfortunately, customer expectations aren’t always realistic. You need to have a frank discussion with your customers and explain that while you opportunities are opening up, they need to taper their expectations to make sure they are reasonable.
Update your business plan to reflect ongoing changes
Change is a complicating factor for all businesses. Your business plan will need to evolve to reflect these changes so that you can continue to adequately serve your customers and manager their expectations to the standards within your industry.