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Lies my vendor told me: Tech relationships gone wrong

By Cara Garretson
March 25, 2011 06:00 AM ET

In the case of the luxury retailer, the IT manager felt that the SaaS provider misrepresented its transaction processing capabilities. "The service provider said no other client [than us] had this issue. We always suspected some overall volume problem; maybe we were on some shared platform and another client took it down so there was a domino effect," the IT manager says.

Experts who lack expertise

How do you avoid technical and interpersonal difficulties like those experienced by the luxury retailer?

IT managers say that being as rigorous as possible before any contracts are signed -- asking questions, verifying claims and getting promises in writing -- can help avoid conflicts and disappointments once the ink is dry. (For more tips, see How to bulletproof your vendor relationships.)

The Daily Herald, a publisher in Everett, Wash., recently ran into a situation where more verification earlier on could have saved some headaches. As it was, misleading information provided by a vendor during an evaluation process resulted in significant extra work for the IT department.

The company, which puts out a daily newspaper, five weekly publications and one monthly publication, was searching for a new editorial system to handle a variety of tasks, including managing photos, text, graphics, story plans, assignments and notes.

The company asked a vendor how its software would run at multiple sites, since that was one of the prime requirements, says Michael Lapham, manager of technical services at The Daily Herald. The vendor said it could run Citrix at remote sites, and that it had in-house expertise to help install and configure remote systems.

After signing a contract with the vendor, Lapham quickly discovered that its Citrix expertise was exaggerated, to say the least.

"It ends up they didn't have any in-house knowledge of it at all, only that one of their customers was using it," Lapham says.

How to bulletproof your vendor relationships

  • Talk to the vendor's technical staff during the buying process. Ask about features, performance and product road maps, particularly anything that will be important to your business in the next 12 months.
  • Examine and check all references closely.
  • Get in writing every promise related to the product's performance and features, uptime and tech support.
  • Find out which firms are providing hardware, software or services to your vendor. Ask what happens if those secondary vendors go out of business or end their relationship with your vendor.
  • Consider piloting a few licenses of a new system to ensure it works as advertised before rolling it out to many seats.

The vendor knew that remote access could be done with Citrix -- because another customer was doing just that -- but it had zero experience installing and configuring such a system and didn't offer any help. "So you could say what they told us was a bold-faced lie," Lapham sums up.

The Daily Herald's IT department had to do the Citrix installation, which ended up being a quick-and-dirty job just to get the system up and running. "We put in a minimal configuration; it wasn't exactly best practices. We're aware that we didn't end up doing it the best way, but that's what we had to do, since the vendor had nothing to provide us with," Lapham says.

Upselling and overbilling

Due diligence is ideal but not always possible, especially with smaller companies that don't have dedicated IT staffs and may not know which questions to ask.

A few years ago, IT professional Thomas Peacock got so fed up with the new president at the small IT services company where he worked in Spokane, Wash., that he quit four months after the new executive came on board.



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