A number of years ago I was at a partner event, if memory serves it was a Microsoft one and amongst others there was a representative of the IT company 2e2. I’d never actually heard of them, so as you’d have expected I quickly went out to do some research on to who they were and why they were in my neck of the woods. Unfortunately the MBA kicks in when I see a competitive threat.
To be brutal, I’ll be first to admit, that IT companies are ten a penny so the fact that I’d missed a relatively large firm didn’t particularly surprise me. I dismissed them as a big outsourcer who like every other IT company that deals at the small business level or large business level all want a slice of the action in the mid-market. However, that’s not to say I wasn’t envious of what they had…
Let’s face it, the large companies that are heavily financially backed are pretty much doing what Unleashed does but on a larger scale – they have venture capitalists and banks behind them. They grow through acquisition and despite all the UK Government ‘said’ it’s doing to allow SME’s bid for government work (emphasis on ‘said’ as they’re doing absolutely nothing) – always seem to get the lucrative work for the NHS, local authorities and other public bodies. There used to be an argument, which I also used to believe, that the big companies may have been more expensive, but they pose less risk.
The argument has become watered down with the bail out of the banks and the disappearance of many high street names. 2e2 of course, went into administration last week, with their impressive list of clients. Last I read Daisy, a channel telecom provider to resellers like Unleashed (not currently one of our suppliers I might add) are looking at acquiring them. I have to admit, I’m not too sure how Daisy partners will feel about their supplier having the ability to complete with them in other markets!
So I guess this leaves IT Managers and Company Directors an important consideration when they’re selecting an IT partner. All this time, you’ve been like the public sector worrying about the size, age, financial strength and capability of your supplier what you fail to consider is the culture in a partner. I’m certainly not suggesting this is easy to find out, but I would certainly offer up the cultural clues in an organisation would go something like this:
- Do the people you’re liaising with, seem frustrated or even disinterested?
- Is your potential partner making lots of acquisitions – sometimes you can acquire to show growth but there is actually no substance.
- Can you ask the simple question, “what is the focus of your business to the people” you’re dealing with and get a consistent and believable answer?
- Do the salespeople seem, keen and helpful towards you and the opportunity you’re giving them, or just plain desperate?
- If you ask the supplier to also provide a proposal about how they’re going to manage the risk to your business when you place an order, what do they come back with!
My suggestion is always to control the risk in an IT procurement project yourselves, demand documentation, work with the supplier when the equipment is being installed, learn what you can – get that guarantee in writing before you even sign the paperwork.
I wonder, quite too much at times, that some companies that are heavily backed by the venture capitalists and banks are more like the manufactured boy/girl bands of the IT industry. On the surface, they look good, they may even sound good – for a short while they even make a fair bit of money, however the principles and substance just isn’t quite there.
The number one, absolute, deal killing, key point you must remember is – do you get a good vibe? I am a firm believer in both the mind and subconscious, so if you’re gut instinct is telling you that it smells a rat, believe it. Sales people are very good at getting you to over-ride what your brain has subconsciously worked out and took a dislike to. If you have a niggle of a doubt, walk away and talk to another supplier until you find people you both like and you don’t have any modicum of a concern about. Although this will never be taught in a business school, your own gut instinct is the most important risk evaluation tool you have, you need to tune into it and believe it.
Certainly for us, none of those things scare me – we tend to make sure that there is a spread of risk between ourselves, suppliers of both hardware and soft services. We have answers. As for your gut instincts about us, well we’re small but growing, in the good old organic way – we don’t take risks on acquisitions (despite the fact I may quite like the idea of a bank giving me loads of money to buy a competitor or three), and we’re thoroughly nice knowledgeable people to deal with.
The great thing is – you don’t even need to take my word on it! If you have any such concerns on IT providers you’re dealing with and just want some non-committal advice then feel free to give us a call.
