Every Business Has Risk - Identify It
Conflict comes when you do not even think it could ever happen. When I had my firm (business tax and advisory firm) in Los Angeles, conflict came with bad clients. My staff wanted me to take on a high-profile sports figure, I said no. I did not want to take on a risky client that had a reputation of bad people that surrounded him. Some awfully bad people. The staff wanted me to take him on even without a client agreement. I lost it, they wanted me to take on the risk just so they would have the status of this client. I only saw risk, no profit, and later I was right.
I told them no contact – no service. I wrote a detailed client contract to protect my firm. Funny thing, the client signed the contract, and the ink was not even dry, and the conflicts and disputes started. His team that surrounds him began threatening my firm. One evening I took a member of the Press from the country he was from to dinner. I left my car at the hotel and when I got back – every single window of the car had been smashed out. A clear warning from member of his team. Do not mess with their tax and money they were getting from my client. I saw that those around him were taking money away from my client on their own projects. The people that surrounded him smelled money and they wanted it, no matter what or who they had to harm. Dirty business.
The more we worked with the client the larger the risk became. The threats grew. During this three-year contract he never once paid. I had enough and I have to litigate through arbitration to collect the fees owed. If I had not had a strong client contract in place, identified there was risk, we probably would have lost everything. We were able to settle through arbitration. Identify risk in every client and protect yourself.
When you have a business, you will have risk. Protect your business, know there is risk and make sure your operations have strong legal contracts, operating procedures, review process, and you document everything. Mediate and arbitrate your disputes and conflicts. Based on my experience, the mediation and arbitration language saved my business. Look at risk with every client you take on and hire a mediator to help resolve the disputes before they become very costly. The longer you let a dispute grow the more expensive it becomes. Identify risk. Protect your business. - Michael Lodge, NCPM
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Michael Lodge is a Nationally Certified Professional Mediator specializing in business disputes, as well as family conflicts. He has written three books and hosts an international podcast on IHeartRadio and other podcast media stations.