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Monday, January 13, 2014

Learning the Hard Way

When you do something for 25 years or so, you think you know some stuff.  Some lessons just have to be learned the hard way.

Some time ago I was asked to name the highest and lowest points of my time in the incentive world.  I had a great career in incentive marketing so it's tough for me to name a single event, but the high point has to be the friends I've made over the years:  employees, competitors, counterparts and customers.  I remain in touch with people I haven't worked with in 20 years, and still feel very connected (could be a Facebook or LinkedIn delusion, but I digress...).

Of course, I can also name a few low points, but the lowest of the low is this particular experience that resulted in an 18-month almost-litigation and some very bad feelings all around.  What had happened was....

Customer "X" decided to combine two programs that shared no elements:  different logos (for imprinted merchandise), separate sales channels, separate customer audiences, separate internal teams.  I could not understand why they expected to reduce program costs under these circumstances.  (Note for future:  if your customer has unrealistic expectations and you can't figure out why, consider that your competitors are promising results that have no chance of occurring.)

We had successfully managed the smaller program for over 7 years.  My first critical error was imagining that a proven track record would count for anything in a bid situation.  My second error was in proposing what I believed the customer needed vs. what they asked for, and honestly described the results they could expect.  The third error was in underestimating the value of outright bullshit and a full-blown fake dog-and-pony show in a corporate bid situation (this is the bitter part...).   The fourth critical error was not fully grasping the politics in play and the strong high-level Sugar Daddy that was supporting the other incumbent.

Long story short, we did not get the program (totally my responsibility - that's not the worst part) and made the really bad decision to partner with the incumbent of the other half of the business that was being combined.  Lots of stuff that I can't talk about here, but suffice to say that combining the processes and cultures of our two organizations proved to be very challenging (big understatement).  Word of caution:  even if you have a fair agreement that has been drafted and reviewed by both side's attorneys...nothing can guarantee that both parties will actually fulfill their end of the agreement. Oops. Work stopped, customer disappointed, partnership over, jobs lost, attorney fees all around.

Three expensive lessons were learned:  First:  I made a decision out of fear instead of according to a business plan, so rather than suck it up right then and lay off people, close an office and move on, I grasped at straws.  My intention to keep people employed just put them through a year of hell before they lost their jobs anyway.  I'm so sorry for that.

The second lesson is true of life as well as "just business":  you can't do a good deal with bad people.  I had a gut feeling that I ignored.  A very wise employee put it this way, "lie down with dogs, wake up with fleas".

Third:  Never, ever, ever (don't ever) agree to arbitration as a remedy in a contract - especially through the American Arbitration Association (AAA).  It's expensive, it takes forever and I understand that "splitting the baby" (charming phrase), or splitting the amount owed is a favorite practice.  (Why on Earth would you want to drag this stuff out for many months only to split the difference?  You need an arbitrator to come up with that solution?!)  Thankfully, we didn't get that far. In hindsight, I would have preferred to just sue and tell my story to a judge.

One more thing:  people are fond of saying, "it's not personal, it's just business".  That is a load. I'm not suggesting that companies never change suppliers or that sometimes it's not the right fit or that sometimes you're going to disappoint people or that sometimes you have to lay off good people.  I'm just saying, be a little human about it. Business is based on relationships, and relationships are personal.  It's all personal.  You don't have to be a jerk about it.

It sounds like I'm still fired up by this but in fact, I let this go years ago - it's not one of my proudest moments but am sharing this as a cautionary tale.  (At the time, my Posse Sisters suggested meditation; I find that I can go into a very relaxing trance walking through the aisles at DSW, thank you very much.)  I can't say I'm exactly grateful for the lessons, but these are mistakes I will never repeat.

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