Owners of new businesses have myriad ethical problems similar to the problems in mature businesses. The difference is that new business owners don’t have years of experience to help them more easily make sound decisions. But practice and a good process can lead to long term, honorable business growth. Case in point:
Dear Ethics Adviser,
I’m passionate about making life easier for folks. I’ve started a concierge service I sell to businesses that they, in turn, provide to their employees. I’ve been able to get a few accounts, but I’m not growing as fast as I’d like. Part of my problem is not knowing how to price my service. I think I’m overcharging. It’s not as if I can ask my competitors what they charge.
A colleague of mine recommended a strategy. He said to ask a friend who does procurement at a local firm to put out a request for proposals (RFP) for concierge service. The friend wouldn’t really want the service, mind you, but would put out the RPF simply to collect bids from companies and then tell me what they charge. This way, I get the best information about the market and won’t overprice my service. Would you recommend this strategy?
While the strategy is practical and can yield fast results, it is not ethical and should not be used. Ethical decision making requires that you think far, wide, and high about your options.
In this case, when you think far, about consequences for all, you notice that competitors would anticipate that they could get business from their work. They would use valuable time completing your fake RFP that they could instead use on live prospects. You are creating harm. Would you want someone to do this to you?
When you think wide, you recognize all of the duties and obligations you have to different people. A fundamental duty is to try to tell the truth. In this case, you are being deceptive in order to make life easier for yourself. This is wrong.
When you think high, you ask yourself, “What kind of person do I want to be? Would my mom be proud if she knew about my action?” The moms that teach us to be strong and true would not approve of this way of finding pricing information. It’s a short cut, and not noble.
So when you stop to think far, wide, and high, you see that this pricing strategy is wrong.
What can you do instead, Passionate?
Rather than seek a fast solution, get your mind around the fact that business wisdom comes from the school of hard knocks and it can’t be shortchanged. Experiment; try one solution, then another; succeed sometimes; fail others. Engage with business leaders you truly admire to get advice. Keep your values front of mind, and profit has a great chance of following.
This column was printed in the February/March 2018 edition of B2B.