I have to admit: I had a hard time deciding what to title this article. What isn’t hard to do is actually write the article, at least knowing where to start comes easy. Like many businesses, all too often—despite doing the homework of checking out vendors and getting references and referrals—you can still have a vendor who has a stellar reputation in the community fail to perform on your particular project. This is the subject for this particular article: What happens when vendors don’t perform well on your project either by:
- taking longer than originally contracted;
- making a mess of the actual project;
- failing to execute the project entirely; or
- combining the above elements.
Solo Entrepreneur, Small Businesses, and Being Taken Seriously
All too often it seems that how vendors treat the customer depends upon the size of the customer. The bigger the customer, the more “care” the customer gets. I know some of you are saying, “Of course; there is more revenue associated with the big customer! We are naturally going to pay more attention to the big customers! Duh!” Well, “Duh!” back at you. A small customer may have more revenues and be more profitable to you in the long run because they:
- have more smaller projects (more frequent smaller buys);
- have more connections and thus more referral potential to other small customers who will make more frequent small buys (multiplying your customer base and frequency of buying);
- have a higher profit margin on the services and purchases made;
- have more “up sell” potential for you to sell additional products and services with a little effort and “relationship” building.
Disrespecting the Small Buyer: Big Consequences
Judging a company by the number of people it employs is 20th century mentality that I hope will soon be left behind. In this age of technology and innovation, companies are also leveraging relationships and innovation in the designs and structures of their organizations. A “solo” practitioner and small businesses that have one or even a handful of employees may have significant technology and other service needs that vendors overlook if they strictly look at the company from a “head count” perspective. If businesses look at organizations from a strategic perspective instead, they may see a company that could be leveraging a small number of people to create a “large footprint.” Behind that larger footprint is a significant amount of horsepower that connects the entity into a community of potential—which is a powerful opportunity for profits or for negative consequences when vendors don’t perform.
The Information Technology Example
Information technology (IT) services is a professional services segment suited to providing a prime example for performance potential, both done well and done “wrong.” Let’s use the example of a small business of two or three people that is technology dependent and provides services via Internet, email, and telephone to their particular customer base. As a consequence, this company maintains the majority of their records electronically. The company is “virtual,” in that its employees are located at different sites and must keep a trail of all email communications. Being mobile with laptops is important to the business model as its employees do a lot of training, workshops, and events for business development. They have a customer relationship management tool that is also computerized and they keep all calendars electronically. They are technology savvy with PDAs and other input devices, scanners, printers, and other gadgets that make the busy business run effectively and efficiently. Outsourcing the support of hardware and software just makes sense, so they hire a well-respected, highly recommended local company to provide support. All goes well until the server installation. A one-day project becomes an ongoing exercise in “getting the bugs out.”
The “bugs”: files not migrated from the old computer; calendars, emails, and contacts corrupted or temporarily “misplaced”; a lack of promised synchronization between computers and servers; a laptop that was under warranty from the manufacturer opened with the plan to speed up the process of transferring data (but they couldn’t figure out how to get the last screw out), and so on.
Let’s focus on that last issue—the laptop—for a minute. The laptop only needed to be set up to synchronize with the new server and have data files transferred from it to the server. After being opened (again, despite being under manufacturer’s warranty), the laptop lost all profiles for logging into any Internet connection, not to mention that it couldn’t even FIND the Internet any more. Before the IT group convinced the company that dismantling the laptop for synchronizing was the answer, at least that computer was able to have files transferred onto it for presentations; it had Internet access for workshops, email, and the company website; and it was able to show needed information for workshops.
In this situation, the small business has now reached Week Five after the “one-day server installation” that actually took three days to get the server and desktop installed. Even at the end of three days, the system didn’t include all the necessary software and had a broken calendar, missing emails, incomplete data files, and contacts that were from two years ago, replicated into multiple occurrences, and missing all the associations for classifying them. The previously mentioned laptop is MIA for a second day in this week, for a setup that was originally going to take just a few hours, then turned into one day, and now two. And come to think of it; this makes this Day Four —or is it Five?—of the laptop being worked on, when it only required a “simple” procedure to set it up for synchronization.
Four Letter Words and Expletives Come to Mind
Less-than-reputable vendors tend to disappear and walk away from the jobs; the distinction between a well-recommended vendor and a fly-by-night one is usually that well-recommended vendor continues to work on projects to make things right. This vendor keeps working … and working.
However, that is little comfort when an essential computer is on day two of the “fix” that was supposed to take a few hours and will “definitely be ready by the end of the day”… and that was yesterday … and then by noon … and then by “X” and no one is working on it … and there’s a business event scheduled for two hours after X requiring the laptop…and there is no chance it will be ready.
Even the mildest of mannered people would be losing their minds—and their tempers—at this point. Not to mention seeing the dollar signs mounting as to how much business has been lost due to the disruptions and missed deadlines and so on attributable to the computer snafus.
What’s a Business to Do?
Ultimately, this is a question of what is the best practice for any business in selecting its vendors? We all do the best we can to screen the people with whom we do business. Nine times out of ten, the vendor with whom you have an issue isn’t torturing you deliberately, or even intending to underperform on your project. Even when the vendor “depriortizes” your project, pushing it aside for the “big business client,” the vendor won’t recognize what signal being sent, which appears to you in bold, capitalized letters:
“I’M NOT MAKING MONEY ON YOU. YOU’RE A SMALL BUSINESS, SO YOU’RE NOT AS IMPORTANT TO ME!”
What do you do?
- Make clear to the person you are talking to at the moment that you aren’t happy and that the situation isn’t acceptable.
- Reinforce the deadline and commitment. Be there at the designated delivery time to take delivery, even if the vendor isn’t ready. Why? To clarify the repercussions and set a new expectation and delivery time.
- Ask for the adjustment in the invoice. Don’t pay for what you didn’t get.
- Communicate the performance issues precisely and professionally. (Leave the expletives for your mental conversation.) Tell the vendor that you don’t appreciate having your project deadline missed and the consequences of what it cost your business.
- Evaluate the relationship. Was this a one-time occurrence? Was this something the vendor could have avoided? Do you need to look for another vendor?
- Look for another vendor. Get referrals. Get references. Interview the vendor prospects. Interview and visit client sites of the vendor.
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