Small Business Suffers 20% Income Loss Due to Client Poaching Employees

LeapXpert: Small Business Suffers 20% Income Loss Due to Client Poaching Employees

Having client poaching employees is the last thing any small business owner worries about. But just one single employee managed to cause an overnight loss of 20% in business income. The root cause was software designed to help communication. Which is not something that many small business owners or freelancers worry about.

Believe it or not, instant messaging can be a prime cause of client poaching. Much of the time it isn’t a conscious act by someone who reports to you. But the effect of losing a client remains that same.

Using WhatsApp To Increase Business Efficiency

I run a small English academy on the outskirts of Madrid. Around 95% of my business communications are through WhatsApp. My students and the teachers in my employ use WhatsApp to communicate with me, and with each other.

Each student has their own personal WhatsApp account. Each teacher uses their personal WhatsApp account. The teachers and I all have both private and group chats where we discuss prices, discounts, our timetables and free hours. We share exam dates, training methods and worksheets that we feel are amazing resources.

I literally have no business secrets. Each teacher has the same information as I do. I marveled at what a great idea my group chat for teachers was. I didn’t begin to consider the risks of sharing student contact information. After all, we are all responsible adults!

What Client Poaching Looks Like

As happens, one of my teachers decided to leave to return to their home country. However, what they actually did was move to the next village. The reason why the lied to me was because they also took the students, they were teaching with them.

At the time, this one teacher was in contact with approximately 20% of my active students. Therefore, in one move, they took 20% of my business. Worse, it was simple for them to do so.

When Instant Messaging Is Abused By Employees

Thanks to our WhatsApp group this person had access to all my contacts. What’s more, because of the group messaging conversations this person also had all my teaching materials and my price list.

The students had been working with this teacher. without close monitoring of the communication between teacher and students. Teachers develop a strong relationship of trust with their students. So, it was logical from the students view that they would stay with the teacher rather than with my Academy. He assured this by offering a cheaper rate.

The Wake-Up Call

With this situation, there was very little I could do to prevent it from happening with the systems I had in place. I just wasn’t prepared for client poaching employees!

However, it did start me thinking about other potential issues and risks that I had by using instant messaging as the main communication tool. The scenarios I came up with meant that I could no longer afford to have my teachers using their personal accounts for business use.

A Few Risks Of Using Personal Messengers For Business Communication

Here are some to consider:

  • My client poaching employees had access to all the company’s client contact information
  • If an employee’s phone is lost or stolen the client’s information is only as safe as the phone’s encryption or pass-code. We would lose all our business communications, from the teaching materials to the data records
  • There is an instant loss of communication if an employee’s phone breaks
  • As the employer, you have no control over the communication process
  • There is no record of what has been said, promises or deals that have been made
  • My teachers could share the worksheets and lessons I had created on social media sites, and even profit from them.
  • Other teachers could easily steal more of my students, knowing my systems and prices, creating even further competition

The Lasting Effects Of Client Poaching Employees

I know that I am lucky that I don’t run an international multi-billion-dollar empire. However, my brush with client poaching and abuse of instant messaging still had devastating effects.

  • I lost all business communication with those clients. This also included a history of their learning, any files or information that they had sent to the team, and even records of who they were
  • It took a chunk out of my business income
  • My reputation was damaged
  • It increased the competition in the area
  • Being completely honest I was devastated by the betrayal. It caused me to second guess everyone, including myself. It upset me so much that I lost a lot of my motivation

I spend a lot of time blaming myself. I was frustrated that this could be a consequence of using WhatsApp. Client poaching employees and business espionage are things that happen to lawyers in the movies, not to small businesses that teach language students.

Yet I’ve realized that this really can happen to anybody, regardless of the size of the business. My bright idea of using WhatsApp to keep us all on the same page had backfired. I hadn’t considered the business risks in using private communication channels for my core business communication.

Finding Communication Solutions

Once I moved on from feeling betrayed, I regained my focus. The first thing I realized was that a better solution for effective communication was critical.  WhatsApp was perfect, my clients used it, my teachers used it, it had absolutely all the functionality that I required. However, that critical flaw of being the biggest risk within my business was a huge problem.

Looking around for a platform was surprisingly difficult. I needed something would keep my teachers and students communicating while ensuring that I was able to retain control of my data. Business communication tools are either expensive or cumbersome. Personal communications are free and easy but, as I discovered, create a serious security problem.

It was also essential that any platform offered a solution for record-keeping in case my company was ever audited. I needed a register of all the communications in case I have any legal battles as well as to meet compliance regulations around data protection. Critically, I needed to keep my client’s details 100% safe.

Personal Messaging Integrated Into Secure Business Applications

The solution I found was from LeapXpert and it ticked all the boxes. Their B2C messaging platform manages to control all communications that occur with my students and my teachers. I can securely share client details and we can even send files between ourselves. The best thing is we can still do this via WhatsApp, so there is no new social media platform to get to grips with. And I don’t have to worry about client poaching employees.

Of course, after my brush with such a data breach, I was now very aware of security. So, the military-grade encryption and multi-factor authorization that the LeapXpert platform uses decreases my concern. On top of all of this, there are integrated compliance controls, so I know I am up to date with all of the latest data protection laws.

While I regret that this happened, I have learnt and grown as a business owner. It is a shame I didn‘t know about LeapXpert FMOP before I had my problems. But if you are reading this, I hope you are in time to protect your business and prevent client poaching employees.

Gemma Lane – English teacher, business owner, writer.

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