Vendor horror stories
Everyone has vendor horror stories. No matter how good a vendor normally is, there will be times that they screw up. Some customers will exacerbate a vendor’s tendency to screw up — for instance, they may be someone the vendor really shouldn’t have tried to serve in the first place (heavy customization, i.e., many one-offs from a vendor who emphasizes standardization), or they may just be unlucky and have a sub-par employee on their account team.
Competitors of a vendor, especially small, less-well-known ones, will often loudly trumpet, as part of a briefing, how they won such-and-such a customer from some more prominent vendor, and how that vendor did something particularly horrible to that customer. I often find myself annoyed at such stories. It’s fine to say that you frequently win business away from X company. It’s great to explain your points of differentiation from your rivals. I’m deeply interested in who you think your most significant competitors are. But it’s declasse’ to tell me how much your competitors suck. Also, I can often hear the horror-story anomalies in those tales, as well as detect the real reason — like the desire to shift from a lightly-managed environment to a entirely managed one, or the desire to go from managed to nearly entirely self-managed, etc. I’ll often ask a vendor point-blank about that, and get an admission that this was what really drove the sale. So why not be honest about that in the first place? Say something positive about what you do well.
I think, for the most part, that it doesn’t work on prospective customers any better than it works on analysts. Most decent people recoil somewhat at hearing others put down, whether they are individuals or competing vendors. Prospects often ask me about badmouthing; naturally, they wonder what’s behind the horror stories, but they also wonder why the vendor feels the need to badmouth a competitor in the first place.
I often find that it’s not really the massive, boneheaded incidences that tend to drive churn, anyway. They can be the flash point that precipitates a departure, but far more often, churn is the result of the accumulation of a pile of things that the customer perceives as slights. The vendor has failed to generate competence and/or caring. While sincerity is not a substitute for competence, it can be a temporary salve for it; conversely, competence without conveying that the customer is valued can also be negatively perceived. Human beings, it seems, like to feel important.
Horror stories can be useful to illustrate these patterns of weakness for a particular vendor — a vendor that has trouble planning ahead, a vendor whose proposed customer architectures have a tendency not to scale well, a vendor with a broken service delivery structure, a vendor that doesn’t take accountability, and so on. Interestingly, above-and-beyond stories about vendors can cut both ways — they can illustrate service that is consistently good but is sometimes outstanding, but they can also illustrate exceptions to a vendor’s normal pattern of mediocre service.
As an analyst, I tend to pay the most attention to what customers say about their routine interactions with the vendor. Crisis management is also an important vendor skill, and I like to know how well a vendor responds in a crisis; similarly, the ramp up to getting a renewal is also an important skill. However, it’s the day-to-day stuff that tends to most color people’s perceptions of the relationship.
Still, we all like to tell stories. I’m always looking for a good case study, especially one that illustrates the things that went wrong as well as the things that went right.
Posted on June 2, 2009, in Industry and tagged contracts, customers. Bookmark the permalink. 2 Comments.
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