In Search of Better Relations for Vendors, CIOs

A CIO recently asked me, "Have you noticed, during these difficult economic times, that many vendor sales and marketing people have adopted truly horrible behaviors?"

I had heard rumblings, but nothing specific. Phone interviews with high-profile CIOs indicated that second-tier vendors were becoming desperate, resorting to aggressive telemarketing and semiethical modes of obtaining access, such as hanging out at school events for CIOs' children, hoping for "chance" encounters. One CIO said he felt he was being stalked by vendors' salespeople. Other CIOs empathize, saying they feel like hunted animals when they enter environments where vendor reps might have access to them. These us-vs.-them comments precipitated a ministudy of the current state of the relationship between CIOs and vendors, sponsored by Charles River Ventures and Toffler Associates.

Seeking a balanced perspective, we contacted vendors, CIOs, early-stage start-ups, venture capitalists, academics, journalists, consultants, systems integrators and analysts.

The results? There's good news, and there's extremely bad news.

First, the good news: All 227 study participants agreed that, despite the bad economy:

• CIOs are continuing to search for and buy innovative and cost-effective solutions to specific problems.

• Many vendors have innovative and cost-effective products that should be deployed.

Now for the bad news: No one is happy or optimistic about the current situation. Indeed, the 61 CIOs we talked to said 90% to 95% of the vendor sales reps they come in contact with are "an absolute waste of time." Do the vendors know this?

Everyone agreed that there must be a new approach to matching IT supply to business demand. Searching for root causes uncovered several categories of investigation:

Asynchronous knowledge. The vendor doesn't know or understand the customer's business. The customer doesn't know or understand the vendor's technology or product. How can we get the right people talking about the right problems? Trade shows, direct-mail giveaways and dedicated sales forces aren't getting it done, the survey found.

Economics of new technologies. A deep-thinking CIO at a major financial institution observed that perhaps the IT environment is to blame for the vendor-CIO disconnect. High-margin, long-life cycle technologies gave vendors like IBM the excess cash flow to educate their customers and salespeople. In a world of semidisposable technology with abbreviated life cycles, is it economically feasible to have an educated sales force? Conversely, what's the value of having a sales force that doesn't speak the customer's language?

Addiction to subscription research. Many vendor reps in the survey noted that they must spend their limited "customer awareness" budgets by courting such companies as Giga, Forrester and Gartner, leaving little money to educate their sales forces on specific customer problems and opportunities. An executive at a major ERP vendor suggested, "Instead of going through a subscription research firm, which ends up genericizing and muddying the waters with their own agendas, a [customer and vendor] forum that provides direct guidance would be of tremendous value" for CIOs.

CIO ignorance. Vendors point out that many CIOs are too busy to really understand the problems or creatively exploit opportunities provided by deploying new technologies. In the absence of a forum in which both sides can collaborate on solutions, many vendors just sell what they have.

All of us have a vested interest in improving relations between vendors and buyers. By raising the issue and provoking dialogue, I hope we can move the ball forward.

Thornton May is a senior member of Toffler Associates Inc. a Manchester, Mass.-based executive advisory firm. Contact him at thorntonamay@aol.com.

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