By Dan Fine, Business Adviser at Hive Business.

Coming up against a never ending series of problems that you don’t know how to solve is scary, and given that that’s pretty much all running a business is about it’s fair to say that running a business takes an extraordinary amount of courage. Of course, like anything habitual, eventually it becomes less scary, but when that happens there is a danger that you will begin to feel like you know everything. You must resist this feeling.

Probably the most tempting thing to forget is that the same facts will lead different businesses to very different conclusions. We like to think that because facts are objective we can evaluate them objectively. No. We can only ever respond to facts in a way that’s contingent on the way we see the world. If that outlook isn’t solidly defined then we will wobble in our responses.

Here’s an imaginary situation compromising three facts:

1. your hygienist is being moody with patients
2. she needs more support, probably a dedicated nurse
3. her beloved cat died last month

How useful are these facts to your business? That really depends on two things:

1. your business philosophy
2. your business strategy

Philosophy and strategy frame your business agenda and explain how your business is going to make money. They’re a blueprint for how decisions get made, which processes get used and how customers are treated. In every well run business any detail can be traced back to how the business founders have proposed to make a profit — the business’s philosophy and strategy. The businesses that don’t have a philosophy or strategy don’t have a coherent approach to dealing with facts.

Let’s take those three statements about your hygienist again and frame them in a radically different business philosophy and strategy. Ryanair. Ryanair’s philosophy is that low price trumps pleasantries so it creates the cheapest product on the market no matter what, then finds its margin by ruthlessly cutting costs. It boasts that it gets staff to buy their own uniforms and pay to charge their phones, knowing that this kind of news will only reassure its clientele.

We can guess that the Ryanair management’s responses to the three facts might therefore look a little like this:

1. your hygienist is being moody with patients. If they took the time to complain then they’re with the wrong dental practice. Our patients will be pleased to put up with the odd off day for the low price. Our work is always safe and effective, even if it’s not always delivered with a smile. Having said that, she needs to be disciplined.
2. she needs more support, probably a dedicated nurse. We don’t want people who need more support, actually we want people who need less support. If she is unable to operate according to our requirements let’s get rid of her. In fact this is a fantastic cost cutting opportunity: there is an oversupply of clinicians and we can easily get someone 10 years younger, hungrier and pay them less.
3. her beloved cat died last month. Non sequitur. She’s clearly in the wrong practice, let’s get rid of her asap and dock her wages in line with any complaints we received about her. Also can we please check whether she has paid back the costs of her training and her bar tab from the Christmas party and if not please dock these items from her final paycheck, with interest.

Now let’s take Starbucks, a business built around creating a great customer experience. Product and people are equally important parts in its value chain, and to control the product it has established independent relationships with suppliers. It pays staff well and gives them all sorts of imaginative perks and benefits so that they are happy, and the happiness rubs off on customers. Starbucks has a high retention rate of staff, and the longer they stay on the better they get at making a great product. Let’s imagine how the Starbucks management would approach the same three facts.

1. your hygienist is being moody with patients. She sounds unhappy and this is unacceptable for patients and must be dealt with immediately. We need to establish if the problem is work related or to do with her private life. In either case we should offer her our support immediately. First let’s invite her for an informal chat, and we need to talk to her line manager.
2. she needs more support, probably a dedicated nurse. Please call a meeting to ask the other hygienists how they feel — with an anonymous feedback system if necessary — and review our rostering system. Let’s find out if we are asking our staff to do too much.
3. her beloved cat died last month. Oh, it’s all starting make sense now. Let’s see if there is anything we can do to help her out on a more personal level. Maybe some time off or a sabbatical. Could we get her a discounted holiday through one of our suppliers?

I wonder, how would your business respond to the three facts? Remember, you can’t know what to do until you understand what you are. So do you really know the philosophy and strategy behind how your business makes money? If not, there’s no better time to find out call 01872 300232 or email us at hello@hivebusiness.co.uk.