That's a great question to ask. Rieva Lesonsky gives us some tips in this Small Business Trends article on how to ensure you can stop being Mr/Ms Nice Guy.
Assess: Are your decisions, attitude or policies negatively affecting your business?
Put the business first: Make sure business isn't suffering because you are giving your employees too much flexibility
Set New Rules: Set up a system so that your business is always running smoothly. "Maybe only X number of people can work at home on any given day".
Know What Really Matters: "There's a difference between the employee asking to take a long lunch to go to an exercise class and the one asking to work at home so she can take care of her dying mother."
How do you ensure that morale is good at work without being too nice?
One of the truest statements ever written is "Give them an inch and they'll take a mile". While it's not my intent to demonize employees, the reality of human nature must be understood to seek an effective balance in the workplace. It is OK to spoil your employees but if balance isn't achieved, you'll get the lower end of the bargain. I give my employees quite a few perks. All of them appreciate it but some of them act entitled and do push the boundaries from time to time. As soon as they cross that line, I swiftly put the hammer down. If you don't, and as the article alludes to, it will set a prescendence and you'll continue to get walked on. Life always seems to come back to "balance". To keep the scales from tipping in either direction, maintain a healthy balance in business as well as your personal life and you'll do just fine.