Ep 9 - Why being awful doesn’t grow your business

We read books that tell us how to hire so we can increase our profits. We hear podcasts that suggest that we outsource so we can enjoy working less while making more. We learn from mainstream gurus that looking to developing nations is THE answer.

But at what cost?

Today we’re chatting about something that is a little bit different than our normal topics. In this episode of Scale the F*ck Up, we’re exploring ethics and social responsibility in business and discussing why being awful doesn’t grow your business.

We talk about:
↠ Not exploiting those who support you
↠ Five big ways being awful impacts your bottom line
↠ What to do if you can’t afford to pay your team a fair wage
↠ Why ethics matters in your business

This is such an important topic and something that isn’t really talked about. Tune in to the full episode to learn more.

Transcript

Welcome to episode 9 of the Scale the F*ck Up Podcast. This podcast is specifically designed to help show you a real-life behind-the-scenes look at what it actually takes to scale to 7 figures. Whether you are teetering around the edges of 6 figures, you’ve already busted through to multiple 6 figures, or you’re dancing on the edge of 7, this podcast has strategies and takeaways designed to support you.

I’m Rhiannon, your host and business strategist for 6, multi-6 and 7 figure entrepreneurs. I have been supporting women to grow and scale businesses that light them up - not burn them out - since 2014. Thank you so very much for tuning in and for being here.

Today we’re chatting about something that is a little bit different than our normal topics. Today we’re chatting all about ethics and social responsibility in business.

So a little bit of backstory here. Over the past couple of months, I’ve had significant dealings with a lady from a developing nation on a project. The company that hired her is one I have consulted with for over 2 years, but this lady is a recent addition.

So if you’re tuning in for the first time or you’re not super familiar with who I am or what I do, I support clients to scale. I know, I know, super generic, right. But there are a few different ways that I do this depending on what the goals are and what the bottlenecks are, but in nearly all of my containers I help clients systematise, strategise, and streamline in order to scale. And oftentimes a key element of that is team. So sometimes I’ll step in and help with onboarding processes and automating things and my team will help execute things, and other times that means me stepping in and helping with and training existing team members.

Cycling back to this lady. She is treated horrendously. Verbally abused. Manipulated. Told that she is already overpaid. Terms of her contract change suddenly to increase her working hours without increasing her pay. Just really terrible treatment, crap pay, and unacceptable working conditions that probably wouldn’t fly in Western nations.

And you know I’ve been struggling trying to put words to this and to share this episode, but I believe this is such an important topic and something that isn’t really talked about.

We read books that tell us to hire cheap labour so we can increase our profits, we hear podcasts that suggest that we outsource so we can enjoy working less while making more, we learn from mainstream gurus that looking to developing nations is THE answer.

But at what cost?

And we could go around and around until the cows come home about whether you should or should not outsource abroad. And you know this isn’t about that. This is about not exploiting the people who help support you.

As business owners, you need to make a certain amount of revenue to cover having a team. If you’re not profitable and you’re consistently going in the red paying your expenses - which includes your team - there’s a problem there that needs to be addressed. 

And if you don’t have enough revenue to cover the costs of doing business, it sucks for everyone because that means unless you get that cashflow up quickly, you’re likely going to have to downsize your team. Which is a lose lose. And working with people abroad can absolutely be a win win for everyone. But not at the expense of treating people less-than, exploiting them, or paying them peanuts.

Okay so let me get off of my soap box for just a minute and let’s talk about actual ramifications of being awful. Now full transparency, when I say being awful, I’m referring to being an asshole. But my team suggested it was probably better to not have another curse word in an episode title since there’s already an f bomb in this podcast name. But, now ya know. 

So, being awful legitimately impacts your bottom line for multiple reasons.

1. Turnover means higher costs.

When you do not treat people well, when you do not respect them, when you do not value them, they are not going to stay with you long-term.

More often than not, they are going to bide their time and look for other opportunities. And as soon as another opportunity opens up, they’ll take it. And why wouldn’t they? No one wants to be in a position where they’re talked down at and treated like crap.

And what this means for you is it actually costs you more time and more money because then you have to go and find someone else. You have to search, you have to interview, you have to make sure it’s a good fit, you have to train. Or you have to pay someone else to do all of that.

2. It decreases productivity.

In addition to the fact that bringing on new team members takes time and costs money, new team members can take a little while to get comfortable. It takes time to learn the lay of the land, learn about your company, and get up to speed on processes and how to handle things. 

This means productivity slides, which again is impacting your bottom line.

3. Customer service suffers.

From a client perspective, it can be annoying constantly dealing with new people who aren’t familiar with you, your business, your case, etc. When team members are unhappy, customer service can slide and/or if those team members leave, the person supporting the clients shifts entirely.

So there’s a lack of continuity and that can be frustrating for clients, which may lead to them deciding to not continue working with you. Which obviously impacts your revenue.

4. You lose other opportunities.

Impact-driven companies don’t want to work with unprofessional, unstable, and unethical companies. Oftentimes if business owners find out about poor working conditions or terrible employee treatment, it’s a black mark on that reputation. And people don’t want to be associated with that.

This sentence from Ethical Considerations in International Business by the University of Texas at Tyler from 2022 sums it up quite well. “Today’s consumers, domestically and abroad, expect the companies they support to demonstrate ethics and corporate responsibility in mission, values, practices, communications and actions.”

So it can cost you revenue because you’re losing opportunities.

5. Things snowball.

Oftentimes if one person is unhappy because of how they’re being treated, they’re not the only one unhappy. Because it’s probably not just happening to them. 

Which can have really detrimental effects if team members are burning out and deciding to leave in tandem. Then things can just sort of snowball and then you’re not just dealing with one team member who peaced out, you’re dealing with multiple team members. OR that one team member left, which added more stress, workload, and uncertainty on others, which just starts the cycle all over again.

I don’t know who needs to hear this today. And you know if you’re listening to this and you find that you’re guilty of doing some of these things, this is not a diss and this is not shaming you in any way, shape, or form. But this is an opportunity for you to step up and make some changes.

I do think sometimes we can get carried away and wrapped up in our own drama, and lives and businesses, and all the things. And we’re all incredibly different, which makes the world go round, meaning how I approach something may be totally different than you. And that is great. There is no one size fits all in life or in business and it would be a disservice to everyone to pretend like there is. But if you are in a phase where you’re prioritising money over everything else, including how you’re treating people and the ethics of the foundations of your business - at the end of the day that actually doesn’t serve you, your clients, your business, or your team in the best way.

There is a way to find a happy medium and a balance there. I don’t have any profound words to leave you with today or any catchy signoff, but I would encourage everyone to think about this topic. Especially because the mainstream goes so against it and can tend to encourage this exploitative behaviour. Be a good human, treat people right, and your business is going to be better off in the long-run anyway. That’s all I’ve got for you today; hope you guys have a great week ahead and I’ll catch you next week! Thank you so much for tuning in and listening.