When an organisation signs with a software vendor, it has committed to a relationship. It’s important that the vendor be honest about pricing and features, communicate openly, help integrate that new app with the organisation’s cloud, and offer as-needed technical support. If a disagreement does arise, the user hopes the vendor will mend the divide.
But not every vendor relationship is so rosy, and many IT professionals have fallen prey to the sunk cost fallacy: they’re dissatisfied but unable to forget the thousands of dollars and dozens of hours they’ve already spent with that vendor.
If it’s not working out, it’s time to let go. Here’s when organisations might want to reconsider their vendor relationship.
1. Your vendor takes you for granted
During the “dating” phase, the vendor courted you with promises of seamless integration and 24/7 support. But as the relationship developed, you became just another number.
Like a forgettable valentine, you’re left to fend for yourself – until, of course, your renewal date nears and the vendor shows up with chocolate to convince you to stay.
A recent SolarWinds survey revealed that enterprise IT professionals feel taken for granted. More than half claim they paid for staff training that the vendor didn’t provide.
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Nearly two-thirds of those surveyed said they resent paying for features and capabilities they don’t want, and 34% felt nickel-and-dimed by maintenance and management fees.
One CIO, speaking anonymously, said: “Oracle and SAP are necessary evils. You can’t not use them, but they are extremely painful to be in relationships with.”
Why? Because software vendors are focused on customer acquisition instead of retention. Once you’ve signed, vendors are content to receive their monthly payments. Customer service calls don’t bring in revenue, nor do training sessions or additional features for existing clients.
What’s more, vendors have a secret weapon to ensure you don’t leave: vendor lock-in.
2. It’s a controlling relationship
Vendor lock-in is akin to a relationship souring after you’ve moved in with your significant other. You want out, but it’s just easier to stay together – you’ve got kids, somebody would have to find a new place to live, and there are mountains of shared possessions to sort through.
Since the success of the iTunes ecosystem in the early 2000s, software vendors have tried to bind consumers to their products.
These tactics are sometimes obvious – when you rent or purchase an iTunes movie, you can’t play it on non-Apple devices. But they’re sometimes sinister: SaaS providers lure users into ecosystems through free trials and loss leaders.
Microsoft’s BizSpark, for instance, offers young companies three years of free Azure services. After a company structures itself around the software, however, switching isn’t a great option.
Companies rely on software for key business functions, so changing vendors can be pricey, risky and disruptive. Vendors know this. They expect companies to shrug at unexpected fees, write another check, and hope the situation improves.
When dealing with vendor lock-in, you may need your CEO to speak up. Getting out of a bad relationship is tough, but it’s worth it.
Vendor lock-in is a particularly frustrating situation when your business shifts, but your vendor can’t get on board.
3. You’ve grown; your vendor hasn’t
Sometimes you mature while your vendor doesn’t. It’s not that you don’t want the relationship to work, but the differences between you have just become too vast.
Software vendor relationships work much the same way. Perhaps your company has edged into the medical records industry and is concerned about data security, but your SaaS provider keeps sidestepping the conversation because its primary concern is customer adoption.
Too many vendors neglect platform updates in favour of sales figures, and some SaaS vendors still have APIs that connect only to internal applications like ERPs or CRMs. But what if internal applications don’t have the features or connectivity your business needs?
Today, SaaS is (or should be) totally customisable – and your vendor should want to help. Vendors create APIs that enable connections to external software and other SaaS providers. The best software vendors offer broad connectivity and a pantheon of security and privacy features, and they don’t try to lock you in.
All that presupposes, however, that your company and your vendor have a trusting, honest relationship that enables you to discuss your differences.
4. You can’t trust your vendor
Every relationship must be founded on trust. How can you discuss your challenges if the vendor has a track record of dishonesty? Furthermore, how can you trust a disingenuous vendor with sensitive data like salary information and health histories?
A recent lawsuit between Affinity Gaming and Trustwave Holdings illustrates the dangers of partnering with a disingenuous vendor. After a credit card data breach in October 2013, casino operator Affinity hired Trustwave, a cyber security firm, to remedy the breach and implement security measures to prevent future attacks.
But after Trustwave certified it had fixed the problem, Affinity’s penetration testing showed Trustwave hadn’t addressed the breach or secured Affinity’s systems against future attacks.
It’s one thing for a vendor to make a mistake, but if your vendor lies about the mistake or covers it up, that’s an issue. If you catch your partner in a lie, it’s time to rethink the relationship.
Plainly put, not every relationship is meant to be. You should make a good-faith effort to communicate your needs to existing vendors, but don’t feel trapped in an unsavory relationship.
There are dozens of SaaS providers happy to service your company, regardless of its size, industry or existing technologies. If a vendor relationship just isn’t fulfilling your needs, it may be time to part ways.
Article by Andrew Storms, VP of security services, New Context