By Naked CIO, 27 October 2008 08:00
COMMENT
In the rush to secure sales, vendors must make sure they don't sour customer relationships. The Naked CIO tells a tale of predatory tactics...
Vendors have never been widely appreciated by users for their generosity and partnership. In fact many CIOs view the major players within the software world antagonistically, as a necessary evil. However recently I was exposed to predatory tactics of enormous proportions.
We use software from a company and over the years we have had a good relationship with this company and were looking to solidify this with a substantial investment in a new product release.
Unfortunately the current economic woes slowed the effort to make this significant licence purchase of the new software. But everyone still seemed eager for the sale so we all worked hard to come to agreeable terms to make it a reality.
The relationship was good so when we notified the vendor that we may postpone the purchase for a short while, as we review our expenditures for the remaining part of the year, I never expected what we received.
A gentleman whom I have never met sent an email to our CEO.
The letter essentially said one thing: 'If you do not move ahead with the purchase of licences as you agreed, I will report you to our compliance enforcement department.'
At no time during the discussions around our purchase had compliance been mentioned as an issue and at no point had anyone raised the fact that we may have compliance issues with the current licensing.
After a review I was petrified to find out we were indeed not in compliance - which beforehand I had not been aware of. We have since purchased the licences to stop any further action.
It turns out the company was well in their right to act in this way. However, the relationship between myself and this company has been forever tarnished - and I will move away from them and their products at the very first opportunity.
It was so absolutely out of line with the preservation and development of a strong business partnership that one of my senior employees was disappointed we did not ditch our investment in their software immediately and look for another solution.
Once the purchase order was signed we asked what the next steps were. An executive from the vendor said this resolved the issue even though we have not migrated away from the previous version of software. This exec clearly cared little about compliance and only about how to get the sale.
The short term vision of this vendor is profound because while he may have got this sale we as a company are resolved to ensure we never do business with them again.
I don't care what logo you have at the top of your letterhead - we are customers and deserve to be treated fairly.
If you have any examples of predatory tactics on this scale, I encourage you to comment on this article below, to ensure these type of backward approaches are not continued. Even the biggest companies must start believing that customer care is important.
Comments
There are 4 comments. Join the discussion
1. Radical Meldrew
This vendor reaction is a symptom of modern business practice. Managers set up lines of business to pursue one objective and give little thought to the overall objectives of the company - every ticked off requirement is a step in the right direction. The compliance numpty who contacted you being a glaring example of how its not done. I would hope that the vendor was truly mortified by the eventual conclusion but I suspect that in reality it would be met with a shrug of the shoulders and casual indifference by most of their staff because it was not actually their business area that incurred the loss.
2. anonymous
Whether they had a right to make a sale in this manner or not you should surely return the favour and write to their CEO / Chairman etc confirming they have made their last sale to your business as a result of the tactics used.
The board have a duty to their shareholders and although it would appear in hindsight you had to buy the license and so have gone someway to contributing to their current quarters sales the fact that you won't be again means future lost revenue and lost customers. Chapter one one of any sales process is that it may take years to win a customer but seconds to lose one, losing one is inexcusable !
3. Rory Choudhuri
>>After a review I was petrified to find out we were indeed not in compliance - which beforehand I had not been aware of.
While their sales tactics indeed stink, I'm equally concerned about your admission. Surely it's your (department's) job to stay on top of precisely this kind of issue?
4. anonymous
For over a dozen years, I worked for a software vendor. Within the organization, the product sales reps were kings and could behave (or misbehave) in any manner that resulted in money.
Sales reps were evaluated at the end of each calendar quarter based on achieving their revenue quotas. Even last year's best sales rep could be fired after a couple of bad quarters.
I watched desperate sales reps forcing sales to prevent them from losing their jobs. Subsequently, the customer would say, "We are never again doing business with XX Inc."
It is strange that software vendors allow -- no, almost force -- their employees to ruin relationships with customers.