Risk mitigation is a hot topic within C-suites and boardrooms. Corporate risk presents in diverse ways, from compliance issues, regulatory violations and sexual harassment to poor customer service, data breaches and more. Organizations are increasingly susceptible to financial and reputational risk when stories go viral regarding ethics and performance failures.
Risk mitigation has become a significant responsibility for leaders within many industries. As such, it has found a seat at the table within routine meeting agendas for the C-suite and board. Why? Because unmanaged risk can harm organizational results when it derails strategic and financial performance.
Most leaders should have a process to identify and rectify known organizational risks. By using proven process improvement techniques, the root causes of the problems may be identified. Action plans can then be created and monitored to rectify the issues in a systematic and accountable manner that facilitates sustained results.
A case in point
I am aware of an organization that did a good job of identifying its material, known risks related to suboptimal customer service. The organization’s leaders discovered a recurring pattern as they analyzed customer complaints.
They found inconsistencies in how their managers responded to these concerns. Even when complaints were voiced directly by consumers, these complaints were not consistently “heard” by leaders. In fact, some unaddressed complaints ultimately resulted in lost sales and legal action.
As the company analyzed the problems their customers encountered, its leaders realized they needed to teach their team the importance of rapid response to complaints. As part of this process, they coached their leaders and managers to receive complaints by respectfully expressing regret and empathy in a safe and constructive manner. They accomplished this task through teaching leaders to master “the power of apology.”
Making things right
In situations where suboptimal products or customer experiences were involved, the leaders were taught to apologize and to “make things right” for the customers. In situations where a misunderstanding existed, but without performance failures, leaders were taught to say, “I’m sorry you experienced disappointment. Please share more about your concerns and help us learn from your experience. We really want to do better for you and for our next customer.”
The results were phenomenal as once-disgruntled customers believed they had been heard and, as such, felt valued. Over a reasonably short span of time, few complaints escalated to the C-suite because leaders had mastered the power of apology in the moment. Their actions closest to the customers had a material, positive impact in mitigating risk for this company. And, most important, they retained customers and avoided costly expenses.
As you contemplate the different ways to mitigate known risks for your company, I encourage you to review the processes you currently utilize to address these vulnerabilities. Perhaps the power of apology might have application for you and your team as you build your risk mitigation strategies relative to customer service.
This is the first of three columns on business risk.
Janet Meeks is co-founder and CEO of Healthcare Alignment Advisors LLC. With 40 years of experience in finance and health care along with extensive service in the boardroom, Janet Meeks is a sought-after adviser to CEOs and other C-suite executives across a variety of industries. She is also the author of the book “Gracious Leadership: Lead Like You’ve Never Led Before,” which was released in early 2018.