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Guest post by: Leanne Hoagland-Smith Become an Author

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Once again, I experienced why ethics is so critical for today’s small business owners and why many small business owners just don't get it.

The other day I was invited to a networking event from someone whom I had just met at another networking event. He said that there would be some time to get to know each other better, some information presented about his company and an opportunity to meet some potential prospects. I asked two very direct questions that I advise all my entrepreneurial and small business clients to ask:

Would those in attendance be in my target market of small business owners of $1 million to $10 million in sales?

Is this a multi-level marketing event?

I was told emphatically Yes and No. So I agreed to come because I believe in power networking: attending as many networking events that are in or potentially in your target market.

After registering for the event at the front door, I then was given a tour of the facility with the emphasis on the people within each office and their accomplishments. My ethics' detector antennae (EAD) began to tingle. Then I was introduced to a variety of associates who began asking me personal questions. Now my EAD is in full vibration. From a sales process, these individuals hadn't established any relationship, but presumed that my relationship with the person who invited me immediately extended to them. There really wasn't any opportunity to meet any potential ideal prospects because each guest was being held in conversation by anywhere from one to three associates nor was there any time to meet with the individual who invited me because he was circling the room meeting all the other guests. Now the words, multi-level marketing and cult began circling in my head.

Given that my time is quite valuable, I asked one of the associates as tactfully as possible if this was informational or a recruitment meeting. Again, I was told it was informational, absolutely not a recruitment meeting and to please keep an open mind because everything would be shortly explained.

Guests were then directed to a small room with stacking chairs (minimum padding) and spent the next almost 2 hours listening to their successful marketing director all the reasons to buy into this multi-level marketing business. Since I was in the back of the room and was not raised to be a rude individual, I stayed. However, I was not a happy camper because I was definitely lied to by the person who invited me because 2 of the 3 points on the last Power Point slide involved recruitment.

What really bothered me was that the majority of people (mostly young people under the age of 30) in the room were actively listening to this sales pitch which was identified numerous times by the marketing director as not a sales pitch. After all, if you joined them part time you could make over $20,000 annually by just working with 4 families in a month. Of course, the marketing director did not say that you need 4 new families each month to sustain that income. As the old adage goes "If it sounds too good to be true, it probably is."

So what does this have to do with ethical values in business – absolutely everything. Ethics first and foremost is about being honest. When I asked the associates what they did, the only response was "We help people." Any further questions were slickly evaded by having a new associate enter the conversation.

Second ethics is a referral mechanism or criteria. Since I network a lot, I also believe in referrals. Ethics is about knowing individuals and what type of values that guide them. As I was intentionally mislead, I can no longer refer him or his organization and when asked will honestly share my perception that this is not a reputable firm no matter what some nationally known business guru said.

In this case, I mislead not only by by the individual who issued the invitation, but the associates I met at the firm as well as the marketing director. Isn’t it funny that a firm can’t even be honest and call their marketing director a sales director? I guess by calling them a sales director would be too honest or ethical and might scare people. NOTE: Upon returning home, I did a Google search of this organization and discovered yes they were a multi-level marketing firm. Yes, I should have done this before accepting the invitation, but I believed that the person was forthcoming in directly answering my 2 questions.

How can you as a small business person who may actually have such a firm in your formal networking group avoid my unethical networking experience? You can follow these 2 simple rules. I used to have only one rule, but now required, due to unethical behavior, to add a second one.

1. Directly ask: "Will my potential client market will be there?"
2. Do a Google, Yahoo, etc. search on the Internet regardless of the response to question #1.

You will learn two things. The first is the ethics of the person involved and the ethics of the organization. Possibly the individual has been conditioned hence why the word cult is used as a descriptor not to think of the organization as MLM.

Small business owners have limited time and need to leverage every moment to build their business. Networking is one such activity. Yet, when other small business owners take advantage of their colleagues through the demonstration of unethical business core values, then everyone loses.

I am sure that this national firm will continue to grow because many individuals want that magic pill for success. However, I believe that by being a lot more ethical, this firm and some of the other similar firms could grow with greater speed and not earn the negative unethical reputation as a cult based multi-level marketing firm.

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