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Time is so NOT on the Customer’s Side

The carriers know that enterprise customer leverage declines dramatically the closer you get to the expiration of a contract or the hoped for installation date of a new service, and they work tirelessly to take advantage of this. 

Here are four techniques vendors employ to capitalize on a customer’s time crunch:

  • Delay providing pricing and initial contract documents – leaving the Customer little room to compare or negotiate
  • Procrastinate on critical questions – want to change a SLA to make it more reasonable or appropriate or find out whether the service is compatible with an application?  Vendors insist that they will have to go to their “product house” or “SME” (subject matter expert – not to be confused with a Smurf – a small cartoon figure that also rarely tells you what you want to hear) guaranteeing weeks of delay in getting the answer, much less a revised provision
  • Delay in responding to contract mark-ups.  Vendor lawyers tend to be “unavailable” for much of a negotiation, only to re-emerge a few days before the drop-dead date to reject most requested changes and eliminate protections that were promised as part of the RFP response. 
  • Insist on last minute revisions – you thought you had agreement on a provision only to have it change when the vendor discovers a new “requirement” days before the end of the negotiations, after the CFO has ‘booked’ the savings for the next quarter. It sounds like something out of Dilbert, but it happens all the time.

What can you do to counter these tactics?  First, start early – earlier than you thought you needed to.  Second, manage the process closely, get committed response dates, and have real ramifications if they are missed (nothing makes vendors meet deadlines like having another vendor tossed because it didn’t meet deadlines).  Third, do as much research ahead of time as possible – the standard guide SLAs are worthless, but if you wait until late in the negotiations to ask about SLAs you are dooming yourself to the standard language.   Fourth, have a reasonable “Plan B” so you can credibly threaten to drop a service (or vendor) if you find yourself being strong armed as time grows short.  Fifth, have a long institutional memory and tell the vendors about it.  If one of them pulls one of these stunts and you don’t have an alternative except to sign up, the next time you have new business look elsewhere and remind the vendor why you are doing that.  Finally, avoid using these techniques yourself – it helps to have clean hands, and what goes around comes around.

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