25 - How Your Empathy is Hurting your Business

Be the Anchor – Strategies and Support for Small Business Owners

What I want to talk about today is empathy. Specifically, I want to talk about how your empathy may be hurting your business. Possibly in ways you’ve never considered before. There are ways you may be getting in your own way through empathy. Now I’m not saying that empathy is a bad trait or in any way wrong, that’s not it. I am saying there is a time and place for empathy and to ensure empathy doesn’t lead to business decisions in ways that are detrimental to your growth.

I’ve had experience, personal experience, in letting my empathy get in my way and my business suffered for it. There are three main ways that I see in which empathy can undermine your efforts for your business. One way is making scalability and how you’re going to transition to having employees more difficult. The second way is in struggling to hold others accountable and not making excuses for people. And the third way is to prevent you from charging what you’re worth. There is a lot to examine in these three issues. How do you identify if they’re problems for you? What do you do to fix them if they are?

I want to talk about how you can still lead with empathy and support as important parts of your business. But if you are allowing empathy to get in the way of, say, transitioning clients to your new capable team members, or if you’re so desperate to be liked as a leader that you can’t clarify and enforce the expectations of a job, then you’re setting yourself up for failure. How can you keep empathy in mind without giving it control? How can you continue to offer top-tier service to clients without doing it all yourself? That’s what I’m going to explain in this episode.

Key Moments

02:15 When empathy gets in the way of scaling your business and transitioning your clients

12:58 How empathy can prevent you from holding others accountable

16:39 Why do we need to charge what we’re worth and not let empathy hold us back?

• Ask yourself if certain clients would be better served by new team members in some areas
• Have you been clear in communicating expectations and productivity needs?
• Does what you charge allow you to appreciate your team well financially?

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Resources mentioned in this episode:

• WINTER PROGRAM ANCHORED LEADERSHIP ACADEMY

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Contact Kari Lotzien | Be the Anchor:

• Website: BeTheAnchor.ca
• Facebook: BeTheAnchorLtd
• Instagram: BeTheAnchor.ca
• Linkedin: Be-The-Anchor-Ltd

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Transcript:

Kari Lotzien: [00:00:01] Welcome to Be the Anchor, the podcast. I'm your host, business and leadership coach Kari Lotzien. When the seas of life get stormy, and they always will, it is not up to us to captain anyone else's ship or to try to calm the waters of the ocean. It's up to us to set our own destination for what we really want, and to learn how to navigate those waves of life together while finding that place of security and stability with others. I call this being an anchor.

Kari Lotzien: [00:00:38] Hello, my friends. I'm so glad you're here. Today I want to talk to you about how empathy might be hurting your business, and specifically, how empathy may be hurting your ability to scale or grow your business. This topic is coming from a place of real vulnerability because as I took my business, I was an occupational therapist for 22 years who grew a private rehab practice and eventually went on to sell that same business that I was so proud of. Now, in these last few years, as I've come into business and leadership coaching, and I've had the opportunity to work with so many entrepreneurs in service-based businesses. So I'm talking to the psychologists, the healthcare workers, massage therapists, chiropractors, SLPs, as well as financial planning accountants, bookkeepers, any space where your service has led your business. I'm seeing a theme through all of these practices as they grow and scale, and they are coming up against the same challenges that I did over and over and over again. And I just want to openly talk about it, because I don't think that this is something that you get in traditional sales and marketing books or how to create, you know, great offers for your clients when we think about scaling.

Kari Lotzien: [00:02:02] What I want to talk about today is where you might be getting in your own way. And I'm going to offer just a little bit of self-reflection because looking back I now see where my own empathy was really getting in my way. So I want to start off with like, let's just be so honest. If you are in a service-based business and if you've started off small, maybe as a solopreneur, you are hoping that maybe you could kind of get this business going as a side hustle and get some clients that would maybe pay you and pay you consistently for your services and the things that you were really interested in. Your ability to empathize, to understand what your clients needed, what their fears were, maybe where they were confused, or what information did they need? When you were able to connect with your clients or your customers in a place of empathy, it likely served your business very well because your customers felt understood. They knew this person really gets me, and they were willing to trade their time and money for your knowledge and service. And that relationship developed sometimes over years. And this is the foundation of, I think, every service-based industry. If you don't provide great service and if you can't empathize with your clients, odds are you didn't really get it off the ground. But if you've done the work and you're at a stage where your business is successful and you are scaling up, then your empathy has likely served you so well to this point. Your clients adore you. They feel so connected and they feel so grateful for the service that you provide to them, the time and the energy and the knowledge.

Kari Lotzien: [00:03:44] But what happens is, if you're the type of person that now you're ready to scale your company, maybe you've decided to specialize in a certain area of practice, or you are reaching a very particular demographic. Or maybe you've started to expand your team because your caseload is overwhelming and you've got so many clients, but now you really need to start filling up your other team members so that you can maybe open up to be more of a mentor, or to do the visionary planning in your company, or to start doing something else. In my own company what I saw was I absolutely started that way. I worked with clients directly and I was so passionate about it. I loved what I did, I loved the learning that came with it. And then over time, as I started to grow and change, I got really connected to doing training and I loved teaching. That's what was lighting me up. I had also developed my business to a point where I couldn't keep up with the demand for the customers that I had. My caseload was overflowing, and it was to the point where if I had one cancellation, it was throwing off my whole week because I didn't have any space or capacity to put that client that I really did care about, that I knew really did need my service.

Kari Lotzien: [00:05:00] So as I started to hire people, what I was finding is that it was really hard for my clients to want to transition to a new team member. My empathy kicked in and I thought, well, I don't want to let them down. I don't want that customer or client to potentially leave my business and my service. I didn't want them to feel like I didn't care about them because I really did. I felt like I could keep doing this. I had developed this over time, so maybe I just should. And that new clients, when they came on, could then go to my team members. Now, the hard thing with that is when we were getting referrals, they were also coming with a direct request for me as the owner. The way that I see this, I'm very recently working with a client of mine who is in the financial world, and over the decade that they've been in business, they've really started to niche their service. So the way that I was moving into training, this particular client of mine was working towards a very specific demographic. So they had learned a lot more about corporate tax planning and financial planning. They had learned a lot more about succession planning in multigenerational family businesses. Their specialty had really started to narrow down, and this is the thing that they were really passionate about, that they were spending their time engaging in learning around, and that was where they wanted their business to go.

Kari Lotzien: [00:06:24] Now what was happening is they had no space, just like I had no space in my calendar when I had a cancellation. They had no space to attract these new clients that they were really passionate and could serve very well, because they had a fairly large practice that included a demographic of clients who were not that type of person. They weren't business owners, they maybe had a small amount to invest over time into their tax savings or their retirement planning. But as this consultant had developed their practice over time, they were just finding that they couldn't let go and they didn't want to let those clients down. They didn't want those people to feel disappointed because that is what grew the foundation of their practice. But what happens is you will reach a plateau that if you continue trying to serve everyone that you were before and grow, there's no capacity, there's no space to do that.

Kari Lotzien: [00:07:21] The quote that I kept coming back to during this time as I was trying to transition my clients: Just because you can doesn't mean you should. I think that when we talk about boundaries and we talk about saying no, and we talk about there's this premise that we are completely good, of transitioning or sending our clients somewhere else when we don't have the information, when we feel like we can't provide that service or we don't have that knowledge. The truth is, in this situation, you do have the knowledge, you do have the relationship, and it's often something that you actually are very confident in and somewhat enjoy doing. But what I know for sure is that when you continue to serve clients that are not in the direction that your business is headed, or maybe you've decided that you're giving up that front line altogether and you're really moving into this place of mentorship with your team, and you really want to move into that, regardless, the longer you hang on to what you were before and the things that you were doing before, you will start to get resentful. And it shows up in such subtle ways but I know for myself and again, I'm just being really transparent with you, that when I held on to those clients that had been with me for years, that I felt I didn't want to let them down and I would keep doing those appointments, what was happening is I wasn't serving them to the best of my capacity, because I just wasn't as passionate about it anymore. My attention was somewhere else, and over time I was feeling like the service that they were getting was not what it should have been.

Kari Lotzien: [00:08:55] And I had to get really real with myself and say, you know what? They would be served so well by one of my other team members who is so passionate about this area of practice. For my financial planner friend, as they were building their team, they had team members who absolutely had full capacity to take on those clients who were not business owners and who were just really invested in slowly saving for their retirement. They were passionate about that. They were building their practice. And she could still serve those clients, probably with a higher level of capacity, by transitioning them to one of her team members. So I think that's a place where we just have to get really real with ourselves, that you got to say no to the things that you can do that sometimes you want to do and that you still love, but it's not aligned with the direction that you want your business to go. It's okay to say I don't do that anymore, and to still have real appreciation for what that client or customer was in the beginning of your journey, and changing the messaging to the reason you're transitioning them is so that they can still get that exceptional service.

Kari Lotzien: [00:10:03] Gillian is an incredible entrepreneur who is going through a time of scaling her very successful business. When she offered to record a testimonial about her experience with the Anchored Leadership Academy to go on my podcast, I was so honored. Have a listen to what she had to say. My name is Gillian and I just finished the Anchored Leadership Program with Kari Lotzien. I'm a financial planner, I've owned a practice for eight years, and I'd hit a space of exponential growth. Everything was going great, but I always struggled with, um, the management of team, how to hire, how to fire, how to have those yucky conversations. And that was a huge takeaway from the Anchored Leadership, where I got tools and practice as to how to implement those things into my business so I can continue to grow and continue to thrive. It was an exceptional experience that I would highly recommend to any business owner who is looking to push through their discomfort to that next level of success. In the Anchored Leadership Academy, we combine weekly live sessions for one hour that focus on a key area of leadership, and then participants have the ability to work through all of the content in the modules between sessions. This allows a nice balance between accountability for really busy entrepreneurs to keep moving forward with the program and get it done, while also having the ability to flex their time a little bit and make it work for them. An added bonus: all participants get lifetime access to the videos, the audio, all of the resources in the course so you can keep coming back to it again and again when it applies to that specific time in your business. If this sounds like an interesting thing to you, click the link in the show notes, book an inquiry call, and let's see if the Anchored Leadership Academy is right for you at this stage of business. Thanks so much. Back to the show.

Kari Lotzien: [00:12:07] I want to point out that knowing it and doing it are two very different things. I think that we look at our schedules, we look at our caseloads, we look at what we're doing in a day and we think, oh, I could probably just squeeze that in. This is a place that I work with clients really closely, and we actually develop sometimes a script or an email sequence or a system to transition clients to bring on someone else. Because I think first step is knowing that you need to but then being able to have a plan and a strategy for how you're going to do it is a whole other thing. So don't hesitate to get support in this, because it is not an easy process and your fears will kick in that those clients will leave or they're going to be disappointed. You're going to want some little support to get you through that.

Kari Lotzien: [00:12:58] Okay, the next one where I think empathy hurts your business, because I know it hurt mine, was in holding others accountable. Now, in being really honest, one of the mistakes that I see many service-based business owners make, especially if you are hiring someone to do a similar job that you were doing before - so if you are a service provider and you're hiring someone else to provide that same service - we will tend to way overextend our own schedules before we hire someone. And then when we do, we're almost desperate that we don't want that person to leave us. What I think happens in this is we hold back on being clear around what the expectations are, the things, the parameters, the KPIs -key point indicators - what are your goals? What are your outcomes when you take on this job? I know for myself, I focused way too much on I wanted my team members to like me. I wanted them to know that they were supported and that this job was going to be fun, and that they were going to have all of this flexibility. I was selling my job. But I wasn't trading that with accountability. I wasn't being clear on what I was expecting. And one of the other things I would do is that if someone fell short of expectations, and I'm going to be perfectly honest with you, sometimes they didn't even know what those expectations were. They were in my head of what I thought someone should know, the way I thought they should be motivated, or the productivity levels that I thought they should have, but I didn't actually say them out loud, or I didn't have them in a system or a process. When that happened, I would find myself making excuses for that person before I had even talked to them about it. So I would say things like, you know, I know you're really busy and I know that it's really overwhelming. And I would take the pressure off before I even said to them, but here's what I really need. I know you've got kids to drop off, and I know it's so hard getting little ones out the door in the morning, I totally get that, you know, it'd be great if you could be on time for work in the morning. Do you see how when I led with empathy, sometimes it was like, oh well, yeah, she understands. She knows it's not really a big deal.

Kari Lotzien: [00:15:14] But in the back of my mind I was resentful because I'm like, come on, we start at nine and I need someone here because I don't have space and capacity to cover your job when you're not here. I really need you to be on time. But by the time I would have the conversation, it was this really evasive, weird, I wasn't being clear, nobody really knew what I meant. I think this is where empathy got in the way. Now, I'm not saying that it's not okay to empathize and to understand where people are coming from and the challenges that they're facing. I think where this gets us into trouble is when we empathize too much, we make excuses for people, and then we don't hold them accountable on the other side. So my go to phrase with this is clear is kind. Do people know what I'm asking them to do? Do they know what the expectations are? And when they don't, am I able to just come back to those conversations? Again, I think having the awareness that you need to is the first step. Knowing like, oh yeah, I do do that and it's probably not working well for me is step one. And I think then having a strategy and a plan, sometimes even developing that script to say, here's how I'm going to have this conversation is the next step so that your empathy doesn't end up being a door that gets closed, that you then are not moving towards the direction that you really need this conversation or these behaviors or these outcomes to go.

Kari Lotzien: [00:16:39] Okay, the last one. This is another big one. I think there are times where we use empathy, particularly in terms of affordability, and we price ourselves too low. Now, I'm going to be really honest with you. This is one that I still struggle with sometimes because I know for myself. I want to be available to people. I don't have a multi five-figure coaching business. That is not what it costs to work with me. I've tried to price myself in the middle where I am working with business owners at what I call the teenager phase. I'm really interested in helping you to scale your business. I really want you to go to that next level. I want you to be an exceptional leader and I want you to make money doing it. Recently, I had someone come to me who was really struggling in their business, and they've been struggling for a long time. They are trying to hold all of the hats. They are the hub of the wheel. They are stretched and stretched and stretched beyond capacity. And they came to me to inquire about my services. But they had no space and no time to be able to even allow time for a coaching appointment. And if you want a little bit more information, last weeks, two weeks ago episode was Is Business Coaching Worth It? And that was a little bit of framework for this conversation that I had. Because this person said to me in anger, this is what makes me so angry about business coaches, is you have information that I need and I know I need it, and I know you could help me, but you are at a price that I can't afford because my business is barely scraping by. I'll tell you out of the gate this person had a seven-figure business. And as I said, my coaching services are not five-figure coaching services. I had to sit back because my first response was, I know how hard business is, and I know what it feels like to be stretched beyond your capacity and feel like you have no time. And this person wanted me to open up appointments on evenings or weekends. That's what they were asking for. I don't have time during my day to spend time on coaching. And I had to take a breath because my first thought was, oh, I could probably do this. If I only took one client like this, I could probably squeeze them in and I understand, and maybe I could, you know, lower my prices for this. Or maybe we could do a trade. And I had to come back to myself to the very first point to say, hang on a second.

Kari Lotzien: [00:19:20] If you are at a place where you have zero capacity to even give me an hour every couple of weeks within a 9 to 5 workday from Monday to Friday, you likely don't have capacity to implement the changes that I'm going to ask you to make in your business. You are better off to shift your focus and really look at your own business. But I'm not the coach for you. I am not going to be the one that is going to meet with you in the evenings. This person also was really adamant they needed to meet in person, because they said they were too distractible when things were online, because they had too many other things going on, and they would just go and return emails or do other things while we were in coaching. They were telling me so clearly. I am not your ideal client. They were putting it right out there. They were being beautifully honest with me. And my empathy was kicking in and saying, oh, but I could, I could do this for this person. So I had to sit back, I had to get real with myself and say, you know what? This is not my best client. I was able to refer that person on to someone who is a phenomenal fit for them, and I think they'll get great results. But what I know now is there's an investment that I expect my clients to make with me.

Kari Lotzien: [00:20:36] There is an investment that you expect your clients to make with you. And as you scale your business, if you have spent money on up-leveling your services and on getting different credentials or specializing in your industry, you are valuable. I want you to hear that again. When you have experience, when you have knowledge, when you have specialized, you have earned the right to increase your prices. Now, if that doesn't sit well with you and that still feels sticky or hard, then I'm going to come at this from a different way because I for years tried to price my services when I was a solopreneur, I thought, well, I'm working for myself, so if someone doesn't pay me or if I lower my price, the only real person that's hurting is me. Then when I went on to paying staff members and team members, the way that I kind of got through this undercharging was because I really valued my team, and I wanted to have an exceptional team to take over. I wanted them to feel really valued. I wanted to be able to pay them not only fairly, but I wanted to be able to pay them well so that they felt so appreciated and they didn't feel like they were barely scraping by, and they could take vacations and they could do fun things with their families, and they could buy that house of their dreams. That's what I wanted to be a part of, because I can tell you my team was incredible and they deserved it. The way that they showed up and the passion and the care that they gave to their clients, they deserved to be paid well. It was easier for me as a leader to think of it that way, that when I was charging a fair amount, when my business was not just barely scraping by, that I was able to attract really great staff, I was able to build my team, and they felt really valued and appreciated financially. That was huge.

Kari Lotzien: [00:22:27] I'm now at kind of at another stage of this, and I don't know if it's my age or just kind of now looking in different industries, because I think in service-based industries, we tend to think we don't want to overcharge because we want to be affordable for clients who really need it. And if you're working with people and helping them with their pain, or helping them with their children or helping them with taxes and finances, you know that your services are needed. And when we charge fairly it can feel sometimes like we're taking advantage. And what I now know is that when you've specialized, when you've done the work and you've got the experience and you've got the reputation to stand on and you increase your prices fairly, there's an alignment. You will attract the right type of clients to your business who are able to pay, but it will also give you the ability if you choose to give back in other ways. You can then do scholarships for your business, or you can offer maybe free trainings or workshops for people. You can give back to charities that you really believe in that are doing amazing things. I now know that if we want to build small community, if we want to build strong communities, the way that we can do this is financially. Maybe in the past you had time to give. You could volunteer to give back. There is still a need for our food banks, for mental health services. There's so many places where we can give back to our communities to help those resources build, and I think when we get really clear about how we want to give back and how we want to build communities that align with our core values of our business, this is the way that you can sometimes overcome that financial hurdle in charging what you're worth.

Kari Lotzien: [00:24:11] So. Thank you so much for being here. When you think about how empathy might be hurting your business, number one, I want you to think about who are you going to transition, who are you no longer going to work with and how you might do that? Number two, holding others accountable, not making excuses for people or letting them off the hook before they even know what the expectation is. And number three, charging what you're truly worth and being able to stand in that and feel confident. As you've talked through these, if you find that maybe you do want a little bit of support in okay, I understand yes, this is me, this sounds very familiar, and you're in a service-based industry that you are looking to scale, the Anchored Leadership Academy might be a great fit for you. I totally invite you to go to my website and check it out. Our next cohort will be going through in March. Our doors are open. We're going to have a small group where you work through modules week by week on the key elements of leadership, of scaling your business. And then we have an hour a week together where we get to talk as a group and really apply this to your business. If this sounds interesting, please do reach out. Let's book an inquiry call and we'll see where it goes from there. If you have not liked and subscribed yet, please make sure that you click on the three little dots and make sure you follow and subscribe so you don't miss an episode. We'll see you next week.

Kari Lotzien: [00:25:38] Please know that this podcast is meant for entertainment purposes only. It is not a substitution for medical or professional mental health advice. If you're requiring support, please do reach out. Thanks so much.