Problematic business relationships - part 2: the cult of the one big client
This is a continuation of the thoughts from “ problematic business relationships”. It explored more the concept of “cult of the one big client”. What is this the reader might wonder? It is the self-damaging almost suicidal action that many small business do while serving a number of small companies by on-boarding a big client who supposedly offers high margins believing that this is the only way forward. This happens although experience as well as theory suggest that this is a path that leads to doom and corporate damnation.
Last time I saw this it happened in the company that my friend Kiran is currently working, a small creative/SEO/digital agency in a small English city, say Norwich. The agency was what contemporary Britons describe as a “laid-back”pace consisting of strict 9-to-5ers serving mostly small local businesses in the area. One glorious day management decided to on-board the new, local, heavily funded, cash loaded start-up which wanted to kickstart an ambitious marketing campaign, lets call them Mega-corp. Agency’s personnel was encouraged to cheer, celebrating how their careers would progress, weather they wanted it or not, and how wonderful the future would be. Until one week down the road of this new relationship the new mega-account prince charming asked them to have some stuff delivered by Monday forcing them out of the blue to work over the weekend. That threw essentially the laid-back culture out of the window.
This week, as I am following the story, a Polish born developer asked, definitely possessed by some unknown to me medieval demon to be additionally compensated for the new extra workload. Soon after his manager abducted the whole company to the largest meeting room. In that meeting room he preached to them that he couldn’t pay more, that he himself was so poor that he didn’t own a car as all respectable managers do. Then — hey , rabbit out of the hat — these are the employment contracts stating that there is no room for overtime compensation. Nobody had ever communicated to that poor car-less soul what all managers should know: when a person talks about money, it is probably something not related to money. My thesis is that our foreign little friend was not demoniacally possessed nor wanted more money; he just wanted his old job back.
What has happened in the English north is something unfortunately common: management saw a business opportunity, management grabbed that opportunity. The opportunity though has different needs than the existing clientele which also happens to be completely different, as a result employees who make things done are completely different as well.
See, the company has Sarah who just got back to the workforce two years after her second pregnancy, when her first daughter grew up a little. Sarah works 8 to 4 then picks her up her first child from school at 04:30. So although Sarah is an account manager, she would rather not pick up the phone at 05:30 which -surprise, surprise- is the preferable time for Mega-corp people to call after all their internal meetings have finished. Similarly there is a developer named James who is recovering from stress related issues. He is still kind of struggling with and chose this company oveer the one down the road or that one in London, both of which were paying considerably more, so that he would not be stressed and would be able to be punctual for the group therapy sessions at 18:00 every Wednesday. Having many small clients over the years inevitably created a culture and attracted people that have structured their lives around it or joined the agency we talk about just because of that. Jumping from this point to having large corporate customers can only alienate them because they are either unable or unwilling to handle it.
That is the first side-effect of making such a deal. The second one has to do with the big client itself. Soon they will treat the small agency essentially like their prostitute telling them to do things that their personnel would never do, like work on weekends or push them conflicting requirements. Do you believe that an account manager from say Pentagram would jump like a well trained puppy accepting a brief so late on Thursday afternoon with a Monday morning (morning !) deadline? No. That’s what happens when you are working with companies that are of a completely different size than yours (hunting an elephant being a deer yourself from the initial article — part1). If a person from the Mega-corp acts completely irrationally to employees of his company, they might in turn complain or just just ask for the behaviour to be adjusted. Our small agency does not have that power, they are being paid to be treated that way.
Some of the readers might be curious about what will happen to that small agency or to their company if they are in a similar situation. I have seen it many times before, there is no need for a crystal ball to predict the future: both Sarah and James, as well as the Polish guy will leave. They will either go to a company which functions as the current agency used to (laid back). If they have adjusted to the now pace somewhere that they get paid more (extra work equals extra compensation anyone?). The agency will continue serving that big client and those smaller ones that do not feel neglected. This set of clients will be served from progressively more strained and stressed employees. the big client will continue to treat them in the same way as their prostitute and honestly that’s what they deserve.
Could this have been avoided? Of course. Things like this happen all the time, in different business cultures and clients. I believe that in this case there are are some inherent attributes of the Britons that make things a little bit different. From my 8 or 9 years here, I tend to believe that we the inhabitants of this island bring the class system to our workplace more than we should. Serving the upper classes, in our case the big cash loaded customer is a self-sufficient and fulfilling endeavour. I’ve seen people believing that they deserve their weekend to be lost to move their account forward. I’ve seem managers shamelessly asking me to ignore smaller clients because “we” need to “concentrate” — what a disgusting euphemism — to a big client. Worst of all I’ve seen smaller clients believing they deserve to be ignored.
In each business there is a specific culture even if it is untold or unwritten: a certain equilibrium of assumptions, expectations, compensation schemes, and so forth. You cannot alter this (1) unilaterally, (2) a lot. Not everyone will follow suit just because one morning you found an opportunity or decided that you deserve a new expensive car.
I am writing a book named “IT Archetypes” — a know thyself guide for the IT people, a know thy-friends guide for the ones that interact with them. Check it here: http://www.itarchetypes.com and sign up to the newsletter for updates on new chapters.