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Biggest Management Mistakes that are Ruining Your Service-Based Business

[fa icon="calendar"] 20/09/2017 10:00:00 AM / by Guest Blog Submission

By Alicia Honeycutt

Managers have a range of responsibilities that go from strategic thinking to boosting employee engagement. All of these roles are equally important for the successful growth and the stability of a business. Unfortunately, management mistakes are quite common in the world of service providers.

Management mistakes can cost a business a lot, including some of its clientele. This is why managers need to understand the specifics of the market, the mission of the company and how these two work together.

If you’re wondering whether the management team is doing the best it can for the growth of your service-based business, you’ll need to keep a watchful eye on some of the most common mistakes. Here are a few of the management errors that occur commonly and that can have a serious impact on the relationship between the company and its customers.


Poor Communication with Clients

The communication strategy is one of the biggest prerequisites for the success of a service provider. If your employees aren’t aware how to carry out successful communication with clients, chances are that satisfaction levels will go down.

Managers are responsible for coming up with a communication strategy and making sure that customer service reps are employing it.

A recent study suggests that communication is the most important factor for happiness with project management.

Good strategies should focus on many aspects of interacting with clients. From choosing the communication medium to figuring out how often updates should take place, managers need to stay on top of all these processes. Very often, this is easier said than done.

Multiple hands-on meetings are often impractical in today’s busy world. This is the main reason why 90 percent of the clients questioned in the study quoted earlier prefer communication in writing, namely via email.

Needless to say, the approach will vary from one service provider to another. To avoid management mistakes, supervisors need to have a pretty good idea about the preferences of prospects and the information they may request. Such information will shape up the particular communication strategy to make every single interaction with clients much more productive.


Crossing the Professional 'Line' with Employees

Many managers build close relationships with their workers, which may be great for team spirit. Crossing the line between being coworkers and being close friends, however, could potentially lead to hindrances down the road.

Being kind to each other in the office is a good idea. Making compromises with quality standards and business ethics is definitely not.

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Very often, managers find it difficult to enforce certain measures that will maintain the quality of customer service. As difficult as it may be to sanction workers, however, such processes will often be the key to much better corporate team functioning.

While there are perks to a close relationship between managers and workers, the risks are far too many. Maintaining a healthy degree of distance is very important for everyone to understand the hierarchy within the organization.

Good rapport with employees can be maintained without crossing the line. When it comes to doing business, you’re in charge. Don’t forget the fact and don’t let people who lack the necessary experience to take over your functions. In the end, everyone will suffer due to your leniency.


A Failure to Address Problems

Another common management problem stems from the fact that many supervisors and company owners feel uncomfortable addressing problems head on.

In many organizations, this is the number one error that diminishes the quality of customer service and reduces the effectiveness of inner dynamics. A hands-on approach, however, does pay off.

It always pays to be assertive and to address issues before they snowball out of control and start to negatively impact your business' productivity. 

Proper feedback is necessary to identify faulty behaviors, shortcomings and areas in need of improvement. It’s the role of the manager to provide workers with information about what they’re doing wrong and how customer service could be improved.

Addressing problems is not the same as bashing employees – a distinction that all managers should understand pretty well. Criticism needs to be based on performance analysis and actual data. Equipped with such information, team leaders can make a strong case about areas in which the team is missing the mark.

The lack of productivity and engagement, for example, will become even bigger issues with the passage of time when left unaddressed. Yes, it is difficult to be critical of people who are doing their best. Still, managers who avoid such responsibilities will set a process in motion that will be even more difficult to rectify in the future.

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Failure to Address Shorter Projects Adequately

It’s a common management error in the service sector to refrain from supervising smaller projects effectively.

Very often, managers will be so focused on project management for bigger clients that they’ll neglect the smaller interactions with customers. Needless to say, this is a massive management error.

Statistics suggest that one failed small project could potentially wipe out company profitability for a very long period of time. Thus, what may seem as a minor task at hand could potentially turn out to be much more menacing (in the case of a failure).

Every single client matters. One dissatisfied customer can accomplish a lot to ruin the reputation of a business. The measures needed to do damage control in such instances may be quite time consuming. Doing effective management right from the start will save a lot of time and money.


Not Having an Employment Attorney

Very often, managers will have to partner up with other professionals for the purpose of guaranteeing smooth business processes. An employment attorney is one such professional. While hiring an employment attorney may seem like a bad idea due to the linked expenditure, it could potentially save the business a lot of money in the future.

Employment law is a very, very, very tricky field. If you don’t have professional experience in it, you’ll probably make a sufficient number of mistakes.

An attorney will make it much easier for you to follow the necessary procedures and enforce regulations. The number of work hours, compensations and even the workplace conditions are subjected to legal requirements. Thus, you’ll find it much more affordable to get legal counseling when getting started rather than when you’re being fined for a failure to comply.

Even if you don’t hire such a professional, you can pay for a consultation when in doubt. Yes, attorneys do charge a lot for their knowledge and experience. Still, think about all the money you’ll be saving by guaranteeing employment law compliance.


Poor Knowledge of the Numbers

As a manager, you should be familiar with the numbers and you should have a strategy for investing back in the business. A failure in either field classifies as a massive management mistake.

You are the person responsible for budget tracking. When a project is running or a client is being serviced, you need to stay on top of financial processes. Otherwise, you’ll end up in a serious mess that will be difficult to fix.

Usually, employees will be diligent about tracking time and billing. Still, you’re the person who should review the numbers and approve the final digit that appears in the bottom of the spreadsheet.

Financial management goes even beyond control during the interactions with clients.

Understand where your business stands right now financially. Figure out which services are contributing with revenue and whether you’re failing in terms of generating enough income. Analysis of financial performance will give you important data that you’ll need for the strategic development of the company in the future.

Once you do the financial analysis, you’ll also have a good idea about the amount of money available for investment back in the business. This is yet another one of your managerial responsibilities.

In order to grow, stay competitive and ensure the quality of your services, you’ll have to invest back in the business. Often, putting profit back in operations will be difficult. Better technology and more qualified employees, however, will make it much easier for the company to generate even more impressive profits in the future.


A Failure to Delegate

When it comes to the biggest management mistakes in the service industry, there’s one more paramount error that has to be mentioned – the failure to delegate.

This is probably a sin that most managers are guilty of.

Many managers believe that they’re the only ones who can ensure proper task performance. As a result, they often get engaged in micro-management instead of focusing on larger and more important processes that impact customer service.

Delegating isn’t the same as giving up authority. It means that a manager who has a limited amount of time knows which aspects of running the business to focus on. Delegating is about prioritizing the most crucial strategic tasks and letting go of some less important elements of leadership.

A good manager knows their team and the strengths of each employee. When these strengths are utilized, the business becomes a well-oiled machine that functions to the maximum of its capacity.

A manager should be capable of looking at the bigger picture, assessing strengths, identifying problems and dealing with those head on. Accomplishing all of those is far from easy but experience and the desire to learn will eventually make things better.


About the author:

Alice Clarke is a marketing expert. She enjoys writing articles about different approaches towards accomplishing one’s management goals. You can find her on Facebook or website.

Topics: Human Resources